Dealer Fraud

Insurance scam happens when the dealer tells you that if you purchase your insurance from them or a company that they work with you will avoid paying higher interest rates. Remember that this is not mandatory. This scam also applies to the car dealer telling you that you must pay life insurance or extended warranties due to “bad credit.” Avoid this scam by simply walking away from the deal.

Turnover scam is just another way to really wear the person down. This dealer fraud occurs when the dealership sends over many different salespeople continuing to ask the customer to invest time and get you to hurry up and buy. This dealer tactic is also called harassment. Avoid this fraud by threatening to leave if they don’t stop it.

This is one of the dealer scams used by dealerships simply to keep the consumer there. This dealer fraud happens when the finance manager insists that the customer makes a deposit before he/she have signed the final purchase contract.

The customer will typically be told that the finance manager has to bring in a copy of the contract offer to his boss and he needs a deposit from you just to ensure that the boss will sign off on it. The dealer will tell you that it’s used just to make sure that you are “serious” about getting the car.

You can avoid this scam by refusing to give a deposit before the contract is finished and signed by both parties.

This dealer fraud occurs when the car dealer tells you that he will beat anyone else’s prices or give you $500.
The car dealer will ask you to get the price from another dealer and he’ll simply beat it. However, the customer doesn’t know that other dealers will not just hand over their information for you to take to someone else.
This type of deals is almost impossible to get because most dealers sell different makes and models anyway. Avoid this scam by not buying into it in the first place.

This is one of the most common advertising scams of car dealers. The scam occurs when the dealership makes you believe that you don’t have to pay for 6 months. However, later when you have already purchased the car and have signed all the paperwork necessary the car dealer informs you that the car is due for payment in 2 months. What is even worse some consumers will not even be applicable at all. They can claim a typographical error or that the deal was a week ago. Be aware, as this is simply a dealer fraud and you should get your deposit back.

You can avoid this scam by asking the dealer to put that in writing before you purchase the car and make your deposit by credit card so that you can refute it.

This scam happens when you are already at the office of the finance manager of the dealership. The finance manager will typically invite you to his office, where he will start to quickly throw numbers at you until you are very confused. Thus you end up paying more than you agreed upon. This car fraud may seem impossible for a person to get away with; however, it is one of the most common dealer frauds. The finance manager knows that you be so confused that you will be desperate to get out of his office, and assumes you will simply go along with whatever he says.
Avoid this scam by asking the finance manager to slow down. Start calculating along with him and make sure that you are getting a fair deal and that you both come up with the same numbers.

This dealer trick is very common today. This scam happens when the car dealer identifies one or two cars of a particular model. However, these are typically the “worst” cars, which may simply have very old the build date, the car has been in the showroom for a very long time or it may be the least popular color and with no options. After this the car dealer will probably run a large advertising campaign based on these cars with the price ridiculously below cost.

When the customers arrive to the dealership they are told that the advertised car is already sold. However the dealer will invite you to look at the other cars in the dealership and you are easily “switch sold” to another car. However, if the customer still wants to buy the advertised car the salesman simply points out why the car is undesirable, and then get the customer to pay more for a better car.

One of the most important factors to consider when you are shopping for a used car is whether the car you intend to buy is really worth its price. Even though the car may look like it’s in a good condition there is still a possibility for you to become a victim of auto dealer fraud. Following are a few tips to help you estimate the real value of a used car.

1. First of all, do a little research on the car you consider to purchase. Find out how much that car costs if it were brand new. Check if the car is still in production and if its parts are still available. If you find out that the price of the car is too low it may have more problems than you think.

2. One of the most comprehensive used car value listings can be found in Kelly Blue Book.

3. Remember that brand new cars generally lose up to 30% in their value in 3 years. By the time the car is 5 years old, it may have lost up to 65%. So the older the car the cheaper it should become.

4. Another good idea would be to take a qualified mechanic along with you. The mechanic will be able to whether the car really is worth the used dealer’s tag price.

5. Get some information about the used car history. You can obtain a detailed vehicle history report on CarFax and other sites on the internet. The vehicle history should include any accident history and insurance data.

Keep in mind that some used car dealers will offer you defective cars, so try to look for a reputable dealer if you want to avoid all kinds of car scams.

There are a few very important things a consumer should do before purchasing a used car. First of all, never buy a vehicle without checking up on the history. Remember, that even if a vehicle appears to be in great shape, there could still be things that have been covered up. Depending on the nature of an accident some cars cannot be sold if they have been in a previous accident. Don’t allow yourself to be a victim of a car scam. As a used car buyer, you must do all that you can to protect yourself from car dealer fraud. There are several highly reliable resources where you can get information about the history of vehicles. It would be a good idea to consult more than one of them.

1. Currently one of the most popular vehicle history information sites on the internet is Carfax.com. You get the history report for cars from Canada and the United States by simply entering the VIN of the vehicle.

2. Another way to get information about a vehicle is visiting to your local registry office. At the office they can inform you if that vehicle has ever been in an accident.

3. Carproof.com and Autocheck.com are two of the main websites that also provide vehicle history reports. Though they require a small fee their information is accurate and is based on the vehicle information submitted to their services. However, you should keep in mind that sometimes information is not the whole truth which is why consulting more than one resource is important.

When buying a used car looking up used car history should be your first step. After you get as much information about the vehicle as you can have it inspected by a mechanic. Do what it takes to protect your money and your investments from vehicle fraud.

This is the situation when two cars after taken up from a scrap yard  are welded together. This auto fraud is termed ‘Cut and shut’. The customer may not always know the originality of the car. However you can still avoid this scam if you take the car to an independent mechanic who can find some sign of serious repair work or tell you for sure about the fake appearance of the car. For example you may search the car for mismatched panels and upholstery, traces of paint on door handles and on window seals.

It’s known than usually salespeople advert prices of a car excluding the on-road costs. You should better always ask for the specific on-road costs to be included, otherwise the salesperson will most likely give you the excluding on-road costs price. No doubt, you have to be protected because your contract may be drawn up on this proviso. The thing is that the moment you sign the contract, the ‘quoted’ price of the car, will then be understated by many thousands of dollars.
To make sure not to be involved in this, you better shop around for car prices online. There, you’ll get a wide array of information on car trends, models, and car price range. Being informed with relevant information, you are at a much better bargaining position with the car dealer. You know what your used car is worth in the market, and you know how far a leeway you can go without losing too much at the bargaining table.