Types of Vehicle Financing Scams
If you have to deal with a car dealer when buying a car, then most likely you’re going to come across vehicle financing scams. One of them, “packed payments” scam, is described below.
The dealer will assure you that the vehicle you want is selling like hot cakes. In order to sell you the vehicle, they will do some “market adjustments”. This is shown by a tag near the MSRP tag set by the manufacturer. Even if the car you want is very popular and has great demand, you should not be tempted since getting a “popular” car does not worth paying a few thousand dollars more.
While preparing your car for sale, the dealer usually will add an additional preparation fee to your bill. Performing a test drive, replacing fuses, or taking the car’s plastic cover off will increase your bill by at least $500! If you visit other shops, you can see that these add on costs are already included in the MSRP as set by the manufacturer. Some dealers mechanically add it to the buyer’s order to make it seem mandatory.
Though this type of scam is already old, it is still in use. How is this scam designed? When you make a loan for the car, the dealer tells you that you are required to purchase an extended warranty because it is one of the conditions of the bank. There is a simple way to avoid this scam. Make the dealer write that the extended warranty is necessary for approving the loan and he/she will most probably find a way to have it excluded. If he/she keeps on including the extended warranty, simply go to other dealerships.
These are some of the most familiar vehicle financing scams that are utilized by car dealers. Always keep these vehicle financing scams in mind if you are going to buy a car.