I would imagine that most auto dealers are completely honest.
However, there are a significant number who give the industry a bad name through the use of a variety of scams. Therefore, you should keep your wits about you, even if you believe that a dealer that you are in negotiation with has a spotless reputation.
After property, a new car is likely to be one of the biggest purchases you are ever likely to make.
It is, perhaps, unsurprising then to realise that car dealers have spent many years coming up with new strategies designed to get more than a fair price for the autos they sell.
Here are a few of the more common auto scams that you may be faced with when looking for that new car –
THE SPOT DELIVERY SCAM
Also known as YOYO selling, this scam is probably the one most used by less than honest dealers.
What happens is that the dealer will appear to quite happily agree to all of your terms and will allow you to drive away in the vehicle you have purchased.
A little while later, however, they will call to say that there has been a problem and that the terms haven’t really been approved.
Upon you return to the dealership they will then re-write the whole deal, and it will end up being a far less favourable proposition than when you originally made your purchase.
The end cost will be much higher, and the dealer may also couple this scam with the ‘risky credit rating scam’, detailed below.
The best way to avoid this scam is to ensure that all aspects of the deal have been finalised before you drive away.
Make sure that any financing is in place and confirmed and that all paperwork has been duly completed.
THE RISKY CREDIT SCAM
In this scam the dealer will imply that your credit rating is less than perfect and poses a risk.
Of course he offers to take a chance – by offering credit at a higher interest rate.
Naturally, the dealer will profit from this higher rate of interest.
The best means of defending yourself from this type of scam is to either shop around and compare the credit deals on offer, or to be prepared by checking your own credit rating in advance.
THE REDUCED TRADE-IN SCAM
Many people shopping for a new vehicle will use their existing one to offset part of the cost by trading it in.
Dealers are prepared for this and so will use a variety of methods to undervalue the trade-in.
This includes simply undervaluing the vehicle in the first place or suggesting that there will be a lot of expense necessary in order for them to re-sell it.
The best solution to avoid getting ripped off in this instance is to have a good idea of your car’s trade-in value before you present it to a dealer.
There are many auto scams to be aware of though, luckily, they are perpetrated by a small number of dubious dealers.
If you apply common sense then you should be safe in your search for a new, cheap auto.