Dealer Fraud

Buying a used car is a bargain on so many levels. Not only do you save on purchase costs you save on ownership costs, too.

Used Car Dealers Pass the Savings on to You
• Some used car dealers get their inventory from trade-ins, others from purchases, auctions or some combination. Ultimately, the dealer’s cost in obtaining the vehicle is lower than it would be for a new car because transportation is not a factor (the inventory is usually from local sources).
• Buying a used car saves you money because it costs the dealer less to acquire and make the car available for sale.
 
Ownership is Usually Less Expensive
• When you buy a car that is 3 to 5 years old you can usually get it for around 50 percent of the original MSRP (manufacturer’s suggested retail price). The bonus – the used car has five to seven reliable driving years and:
o Your insurance and registration costs will be less expensive than for a new car.
o You can still purchase an extended warranty to offset any repairs (just be sure to work with a reputable provider and review the terms of your agreement before you sign on the dotted line).

But before you purchase a car or truck from a used car dealership it is a good idea to ask about any guarantees or services they offer if problems arise after the sale. For example:
• Does the used car dealer offer any kind of a return policy? Some dealerships offer very limited money back guarantees if you change your mind within the first few days of the sale.
• Other used car dealerships may offer warranties of 30 to 60 days after the sale.

Look for a Used Car Dealership that Provides a Certified Inspection
• Certified inspections can help a used car feel new again.
• They can also reduce or eliminate many of the troubles formerly associated with buying used cars.
Look for a Used Car Dealer that Researches and Guarantees Your Used Car Title
No used car dealer should knowingly sell you a car that has been flooded, salvaged or has an inaccurate odometer reading. In fact, if you discover any of these things to be the case after the sale, it is reasonable to expect that you would want a refund. Also, be sure you are working with a dealer that is willing to provide a refund with proof of odometer tampering, etc.

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Buying a used car can offer significant savings over a new car unless you are the victim of car dealer fraud. Here is what you should know about avoiding the car scams that can leave you on foot.

Use An Inspection Checklist
• Inspection checklist are widely available (used car guides or Internet sites are good sources). The checklist may help you narrow your choices to those that are worth a mechanic’s inspection.

Get a Mechanic’s Inspection
• Costs vary from state to state (the average is around $100).
• Inspectors are listed under headings such as “pre-purchase inspection.”
• Ask the mechanic for a full written report of all findings. You should discuss these findings with the used car dealer.
• If the dealer does not allow you to remove the vehicle from the lot for inspection, you can arrange to have the dealer deliver the vehicle for inspection. You will be responsible for associated costs.

Know Something About the Car Other Than the Make and Model.
You can avoid used car fraud by getting additional information about the car from:
• The previous owner
• Reviewing service records
• Purchasing a vehicle history report (carfax.com is a popular resource).

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[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]

New and used car sales are one of the biggest consumer rip-offs. Although many of the tactics used are perfectly legal, it doesn’t change the fact that individuals are being taken by unscrupulous sales people every single day. These dodgy dealers use questionable advertising methods that draw people in, and they try to conceal the facts and figures with confusing jargon.

Beware of car dealers that promise to pay off your current vehicle loan no matter the amount you owe. They will gladly pay off your existing loan because they tack the existing balance onto your new loan. Not only will you be paying for your new vehicle, but you will also pay for a vehicle you no longer have. It is likely that you will end up paying an amount that far exceeds the value of the new vehicle.

When you end up owing the bank or finance company more than your vehicle is worth, this is called “upside down credit”. This is a very bad financial situation to be in. If your vehicle is stolen or totaled you may still owe a considerable amount of money after the insurance company compensates for the damage. Gap insurance is available to cover upside down credit loans, but these policies are hard to find and have numerous stipulations. Avoid upside down credit by not allowing yourself to be taken in by friendly salespeople who promise to pay off your current loan. Their primary concern is their commission, and they don’t care if you end up paying more than your new vehicle is worth.

The car dealer doesn’t always have your best interest in mind. This is true in more ways than one. Car dealers typically use affiliate banks and finance companies with no regard to the percentage of interest their customers will be required to pay. Shop around on your own to find a loan with the best possible interest rate.

Car dealers will work hard to come up with almost any monthly payment you suggest in order to make a sale. They don’t do this by giving you a break on the price. They extend the time it takes to pay off the vehicle. The monthly payment ends up looking good, but the total cost of the vehicle is what you need to consider before signing on the dotted line.

Carefully examine the vehicle you are considering from top to bottom. Used car dealerships employ people who are very good at covering up scratches and blemishes on previously owned vehicles. They use colored wax that’s temporary at best. After being exposed to car washes and the elements, the once beautiful paint job will start to wear away.

Pay careful attention to the condition of the tires on the vehicle you are considering for purchase. It’s a common practice for car dealers to remove original tires from low-mileage vehicles and replace them with worn tires that will soon need to be replaced. If you’re unsatisfied with the condition of the tires on the vehicle you are considering, demand they be replaced or walk away from the deal. Chances are the salesperson will meet your demands in order to make the sale.

Have an independently licensed car mechanic inspect the vehicle you are considering for purchase. Used vehicles don’t often come with extensive warranties. Any problems you notice should be mentioned and corrected before signing the final papers. Don’t believe car sales people who offer excuses for why a vehicle is doing something you suspect to be a problem. The more they have to correct on a vehicle, the less they earn in commission.

Remember, friendly car dealers and sales people want your business, and they will often use questionable practices to gain it. Make sure everything is clearly understood before signing anything. It’s your prerogative to walk away if you’re not completely sure of the proposal, or if you aren’t completely satisfied with the final price of the vehicle you are considering. Take time to shop around, and you’ll find the right vehicle at the right price.
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[ To Learn more our services and areas of practice, please visit our website at

www.DealerFraud.org]