Dealer Fraud

Car dealers usually use odometer rollback to raise the value of a car. This practice of car dealer is illegal. The higher the mileage of the vehicle the less you pay for it, that’s why if you consider buying a used car you should always check the vehicle’s odometer. It is a good idea to start by checking the vehicle’s history. Do the following:

• Checking the inspection sticker for mileage at the car’s last inspection;
• Have the car inspected by a qualified mechanic;
• Asking sellers who sold the vehicle previously for copies of the vehicle’s odometer disclosure forms;
• Checking oil change stickers (usually inside the door frame);
• Get a title search from your state’s Department of Motor Vehicles.

In case you believe your car dealer committed an odometer rollback, you have the right to sue them in federal or in state court under the federal Motor Vehicle Information Cost Savings act. Some states may have specific laws regarding odometer fraud, that’s why it is a good idea to check these laws with your state’s Attorney General and county prosecutors.

Sometimes you can save a lot of money by refinancing your car loan and reducing your payments. However if you decide to do so you should be very careful to avoid possible dealer scams. Following are some tips you should use to prevent dealer fraud.

1. Always do your own auto loan research. You can get information about car loan rates and terms online. Financing broker sites can be a good source to compare interest rates and fees, as well as APR. Make sure to check out terms. Decide what the better option for you is: a short or extended term.

2. Another way to avoid dealer scam is to directly work with the vehicle lender you have chosen. The lender will be able to give you a better and more detailed description of your refinancing package after you submit your application. On the other hand you can cancel the deal at any time, even if you have already signed the paperwork.

3. Never sign any paperwork until you have carefully read the contract and what is more important never sign a blank document. Ask any questions about the terms of the vehicle loan you have before signing the contract. Reputable lenders will be able to answer all your questions.

In case you don’t want to pay for the preparation fee, simply tell the car dealership to credit you the amount of the preparation fee service on your contract. If the car dealer refuses to do so, just walk away from the deal. Remember, that it is legal for a car dealer to charge you for preparation fee, however if you step into the dealership armed with information it will be very hard for dealer to scam you and you will be able to save your money. There are more and more scams and fraud going on today and the best way to protect yourself from dishonest dealers and car fraud is to educate yourself and be well informed.

If you think you are a victim of the preparation fee scam, you won’t be able to report it to the authorities. However, you should report the car dealership to your state’s Better Business Bureau.

Car preparation fee is a good way for the dealer to make a quick profit from customers in the range between $500 and $2500. In fact, this fee is not illegal, but it is considered a dealer fraud, because these fees are covered not by the consumer, but by the factory.

Generally, car dealers charge consumers for peeling of plastic off the seats, checking of fluid levels, vacuuming the interior, and washing and waxing the exterior. Most consumers do pay for this because they are not informed that these fees are already paid for and listed on the MSRP. The fraud when you have to pay for something that is already paid for is also known as Double Collecting. This car fraud is very common among car dealers today and you should be very careful not to be a victim of this scam.

After the recent hurricanes in the southern part of the United States a lot of vehicles were damaged. Though insurance companies have declared these vehicles to be salvage, many flood vehicles appeared in dealership lots. These salvaged vehicles have extensive water damage, but there are steps you can take to protect yourself from buying them.

Flood vehicles are usually sold to consumers “as is” and the buyer finds out that the vehicle is salvaged only when he/she take it to get insured. This is when they realize that their agent can’t even issue them an insurance rate quote because of the salvage title on the vehicle. In cases like this most buyers have to go through a length inspection process with the state motor vehicle bureau that is required for a vehicle with a salvaged title.

One of the best ways to protect you from buying a flood vehicle is to get a vehicle history report from CARFAX or other organization which tracks flood vehicles and other types of damage. You can take the vehicle to a qualified mechanic to be inspected or inspect it yourself. Some signs of high water levels and tale water mark signs may be seen if you look inside the engine compartment. Also check under carpeting to see if there is mold or any presence of water staining. It is important that you thoroughly inspect the electrical system, as this is where the most water problems show up first.

Many cars are sold each year in America and financing is obtained in order to pay for them. You might think that receiving financing is relatively easy, however it is not always so. If you consider buying a new car you should first read these tips on automobile financing before you head to your local dealership.

Compare Rates
You can get financing for your vehicle from a number of lending institutions such as banks, online lenders and the dealership. The difference is they will offer different general requirements, interest rates as well as fee structures. Make sure you evaluate as many financing options as possible and choose the best deal for you.

Credit Score
Your credit score is a very important factor in obtaining automobile financing. It generally defines the interest rates and down payment requirements you will receive and whether or not you receive financing. Make sure you know your credit score before you ever head to the dealership. If your credit score is above 600 then you should be able to get financing without too much trouble, however if your score is below 600 you should spend a few months lowering your bills and focusing on increasing your credit score so you can not only qualify for financing, but also for a great interest rate in order to buy that new car.

Get Pre-Approved
If you have an option to get pre-approved for auto financing then you should do so before going to the dealership. When you are pre-approved you will be able to negotiate with the dealer as if you had cash in hand.

Follow these tips and will be able to get the best financing deal available. You will be able to save money by avoiding dealer fraud and purchase the car you want.

The purchase of a new car may sometimes be complicated and confusing for car buyers. For most Americans the purchase of a car is the second-largest purchase they make. Some dealerships assure that you can buy a car from start to finish in an afternoon. However this is not always the best option for the consumer. Following are several tips to use to avoid any type of dealer fraud and scams when you buy a car.

1. Go to the dealership just to look around and drive the cars. Never buy the first time. This way you will have an opportunity to go home and get some information on the internet, including dealer cost, safety ratings, option prices, and any manufacturer to dealer incentives that the dealer has certainly not told you about.

2. Before doing to the dealership define exactly what you can afford to buy. There are dealerships that use different fraudulent practices and will get you to sign on for a more expensive car than you can afford. It would be a good idea if you talk to your personal banker or credit union officer before going to the dealership. Don’t give the dealer an option to repossess the car.

3. Keep in mind that dealerships make most of their profit in the finance department and for this they use a number of dealer tricks. Sometimes dealers may increase your monthly payments by just a few dollars, even $20 per month, over about a five year period is like giving the dealership $500 extra on the spot. So make sure that the finance manager shows you the calculation whenever he calculates something.

Following are some other scams you should be aware of when shopping for a new car.

1. One of the scams the dealer may use to make more profit is the VIN# Scam. This scam happens when the dealer tries to charge you for having the VIN# etched on the window, because it is required by the finance company. This is not true.

2. Another dealer fraud is the forced warranty scam when the auto dealership will insist that you purchase a $2000, 2 or 3 year warranty in order to qualify for the car loan. The dealer is simply trying to scam you and the truth is you don’t need the warranty.

3. Be wary when the dealer says the phrase “subject to loan approval“. In fact, all car loan proposals will have this phrase in it, but there are only a few unscrupulous dealerships out there that will try and con more money out of you by quoting this phrase as the reason why. You don’t have to worry if you have good credit. Car dealers usually use this scam on consumers that may have bad credit. The best way to avoid this scam is getting your car loan from a bank or other financial institution.

4. The ‘dealer mark-up’ is another fake fee added by car dealers on purpose to increase their profits from the sales. This fee is usually seen on an orange sticker attached to the manufacturer’s suggested retail price.

The above mentioned scams are just several of numerous scams used by car dealers to trick you. When you are shopping for a new car, try to find a trustworthy car dealership to avoid being scammed.

The purchase of a new car is usually challenging and some car dealers may put a lot of additional pressure on you. If you intend to buy a new car you should be wary of scams and dealer tricks designed by salespersons to make more profit out of the sales process. Following are some of the scams and dealer fraud to be aware of when you go to the dealership to shop for a new car.

1. One of the scams popular among the dealers is the credit score scam. This happens when a car dealer informs you that your credit score is lower than it actually is and tries to give you a higher finance rate. Keep in mind that the dealerships will try this scam regardless of your credit score. The best way to avoid this car fraud is to bring a copy of your credit report with you when you go to a dealership to buy a new car.

2. Another popular scam is the dealer prep scam. This happens when a dealer charges an additional $500 on the vehicle for work that is not required, because cars are ready to be driven of the lot when they are received. Purchase a car from a dealership that doesn’t charge dealer preparation fee.

The excusive fee scam is for sure one of the simplest and most common scams used by car dealers. Today lot of car buyers easily fall into this dealer fraud. This car scam happens when the car dealer adds a number under the car price total and asks you to pay it. The car dealer informs that this fee covers their expenses if someone did a check on the car, for cleaning it or removing the plastic from the car seats. However, be aware that this scam is not illegal. Remember that almost always the extra charge is rather high for such services and you should never agree to pay it if you want to avoid becoming a victim of car dealer fraud.