January 17th, 2011 by cheapcar

Used Car Tricks

Top 9 Used Car Salesmen Tricks, and How to Avoid Them

One of the biggest moments in many people’s lives is driving off in their brand-spanking-new automobile. It’s an exhilarating feeling. It’s also a big moment because in that very instant, that brand-spanking-new car loses a big chunk of its value–the difference between the retail price you paid and the car’s wholesale value. That’s typically thousands gone in an instant.

That’s why some car buyers choose to shop around for a used car. You save yourself that steep initial drop-off in value. More importantly, you get a car that runs just as well, is just as dependable, and looks and feels as good as that new car–that is, if you play your cards right.

For if there is one pitfall of buying a used car, it’s the risk of buying a lemon, a junker–call it what you want, you get the point: the wrong car. Used car dealers, after all, have nearly as bad a reputation, if not worse, than lawyers do.

This holds true for individual people selling their cars through newspapers, Web auctions and classified sites, or with the old-fashioned signs in their car windows. The saying, “Buyer Beware,” no where has more meaning than with cars.

The opposite to that, of course, is that there are some real steals out there in used cars. We’re talking about quality vehicles that will perform beyond your expectations at a low price. Here’s how to find these perfect used vehicles, and avoid the top 10 scams that used car dealers everywhere try to pull on you.

1. Get a second opinion for the hype. Used car dealers will bombard you with every adjective under the book to sell you on a car–sporty, thrifty, fast, and etc. Don’t take their word for it. Instead, find someone you know, whether a neighbor, a colleague, a family member, or a friend, who owns the same make and model of the vehicle, and ask them for their opinion.

2. Do a background check. One of the most unethical, but legal, things someone can do to you is sell you a used car that’s been in a flood (and sort of repaired), or one that’s had 10 previous owners (none of whom repaired it). To be sure you don’t fall victim to this, track down a history report, including a clearance check on the vehicle title.

You can even get some of this information from the seller, simply by asking why they are selling it. You’d be surprised what beans people may spill.

3. Examine for past damage. Used car dealers may also try to peddle a vehicle that was wrecked in a major accident. It’s amazing what autobody experts can do to repair a car’s exterior. So don’t go by the outer appearances of a vehicle. Before you buy it, make sure that it does not have serious damage to its frame, which it would have if it was involved in a crash.

4. Call up your trusted mechanic. Used car dealers, especially the big lots, will say they put their used cars through a “100 point inspection,” or something like that. Once again, a second opinion is in order. Get this one from your own mechanic.

He’ll be able to tell how good a shape the car actually is in. Also be sure to ask him or her how often the car had been serviced. A good mechanic can even gauge that.

5. Research for recalls. Needless to say, a used car dealer may sell you a car that’s actually under recall in his mad rush to get the car off his lot. So be sure to call the car manufacturer, or visit their Web site, to see if the vehicle has any active recalls.

6. Avoid the leftover lemon. Along with recalled vehicles, dealers may even perpetrate something much worse on you–sell you a lemon. (By definition, a lemon is a car that’s still under warranty, which has such major problems that, warranty or not, it still cannot be fixed in a reasonable way.)

The best way to avoid this is to research in Consumer Reports or the various automobile magazines, which all have yearly reviews of every make and model on the market. They’ll tell you whether a kind of car is known for being a lemon and prone to breakdowns.

7. See through the old paint and bait. Along with performing their “100 point inspection,” car dealers may shine and wax a used car–even repaint it–to hide dents, dings, and rust spots. A keen eye, though, can see right through this.

8. Take the test drive. Once you’ve done all your research, homework, extra credit, and everything else called for in the first seven steps, then comes the fun–the test drive.

Drive the car for as long as its owner or dealer will allow you. Then you’ll get a better feel for how the vehicle handles, accelerates, brakes, and otherwise suits your tastes (or doesn’t).

9. Be wary of the pushy seller. At any stage of the game–from the moment you first talk to the seller to the test drive–be careful if the seller gets pushy. Any dealer or seller who is in a rush to move a vehicle should set off bells and whistles. Why the rush? Are they hiding something?

In some cases the seller may just be excited to sell you the car–and actually happy for you–but in many other cases, they may be up to something. Better be safe than sorry.

Follow these 9 simple steps to avoid the scams and pitfalls of used car deals, and you could get the car of your dreams–for far less than you’d pay if it was brand-new. Plus, you get that same high when you drive your new used car home, without losing thousands of dollars.

About the Author: Donald Lee
Donald Lee is the public relations manager for Buysellcommunity.com. Buysellcommunity provides free classified listing services. Buy, Sell and trade: auto, computers, household items, real estate, pets and much more. For global and localized classifieds, please visit  Free Buy & Sell Classifieds

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November 25th, 2009 by cheapcar

Car Selling Scams

• Forced Credit Application

If you expect to pay for a car outright with cash, or with a bank draft or check that is your right and ultimately a sensible approach. Some dealerships will not let you. They are trying to get you into paying monthly terms, which of course means more money for them.

Some statements you may hear include:

“State laws require that you must fill out a credit application before I can sell you this car.”

“Everyone that buys a car from us fills out a credit application first.”

“It’s the company’s policy”.

If you are presented with any of these lies, you now know what’s going on.

When you are paying cash why would you think that you need to fill out a credit application? Not only does it not make sense, no state will force you to apply for credit when paying cash. Would you fill out a credit report if you want to buy a sofa or groceries while paying cash? To avoid this scam, just laugh in their faces and take your business elsewhere.

• Sold “As Is” Used Car Scam

This is when a car dealership will sell you a “completely refurbished” car, omitting to tell you that the car has been in a major accident. Basically, the dealer has been saddled with this wreck, used as a trade-in, and just wants to be rid of it.

The vehicle in question will have an “as is” sticker on it, and that no warranty is included with your purchase. This is the dealer’s way of telling you that you are assuming all risks for the car, and apart from the fact that it is not under warranty – you cannot bring it back and complain.

• Dealer Mark up Scam

Apart from being totally unnecessary, this car dealership fee is charged for no reason other than money-gathering. This fee is seen on the orange sticker marked on the manufacturer’s suggested retail price (MSRP), and is a result of expecting money for no other good reason, other than the fact that they want money for nothing.

This sort of fee is generally comprised of -  anything that comes to the dealer’s mind and worded as such to confuse the unwary.

Asking the dealer to remove it, is up to the individual car buyer and probably a waste of your time, certainly a daunting task, when confronted with a seasoned car salesman – any dealership employing this sort of add-on fee tactic, already has a prepared patter designed to baffle any questions.
If the dealer cannot adequately and clearly state just what is entailed in these extra charges, take your business elsewhere.

• Payoff Your Loan Scam

A fairly common sales strategy with some car dealers,  will be them offering to pay off the balance of your current car loan, no matter how much money you still owe on it. There will always be some buyers, upon hearing this, that think the purchasing of a car with a new dealership, somehow now means they now owe no money on their current car.

Er, no.

The reality, is that the dealership does in fact help you get out of your current contract; however, they are not going to tell you – that breaking the lease agreement with your old dealership, will now make you responsible for paying a high increase in  your fees to make up the difference.

You also will not be able to refinance for a new car until those fees are paid. Under the pretext of doing you a favour, the dealership will offer to add the cost on to your new contract with them. At a substantially higher rate, of course.

The dealership only agrees to this deal because they want to get more money from your current car. They will also give you far less than your car is worth on the trade-in. This scam works well, for them, because they will increase your monthly fees, and then, sell your trade in for more money than its worth – certainly more than they afforded you.

These kinds of dealerships, will then quietly extend your monthly payments so that it appears to you, that you are paying a smaller than expected monthly repayment, without even realizing that you have in fact committed to an extra year, of repayments.

Avoidance of this scam, requires that you continue with your current lease contract until it ends. If you are really determined to get a new car, then you should try selling your current car privately. Just sell it outright so that the buyer just assumes the lease payments.

• Bouncing Check Scam

This is when a car dealership announces to you that they cannot accept your bank draft, because your particular bank is always bouncing checks, so often in fact that they now refuse checks from your bank. This then gives them an opportunity to get extra money from you, by offering to sell you a car at a higher interest rate, due to the contrariness of your bank.

You can avoid this scam by getting your drafts from Capital One Auto Finance. Capital One Auto Finance is in the business of giving car loans, so these checks don’t bounce.

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November 18th, 2009 by cheapcar

Auto Dealership Scams

• Car Financing Scam

When trading in your old car to offset the price of the new vehicle, the dealership finance manager will tell you that your interest rate is good, and allows you to take the car you were after – and we are all friends.

After a small amount of time, maybe a week or two – this of course gives you time to get attached to your purchase, you get a call from the finance manager, telling you that you didn’t qualify for the original  interest rates, agreed to upon making the original purchase deal.

Every new vehicle purchase has a clause in the contract that usually states that the deal is “subject to loan approval.” This is the finance manager’s loop hole for hitting you for more money. Contractually, this indicates that the deal is yet to be finalised, even though you have already taken the car, use it as if it is solely yours, and have signed the contract.

The dealer can then charge you $1000 or more in finance fees and up your monthly payments by $50. This scam is made more plausible by being applied people with bad credit, or a history of such. If you are wondering why they would sell you the car at 6% APR if they knew you had bad credit ( having already run a credit search in your name) the answer is simple; to sell the car.

If you know that you have bad credit, this kind of scam can be avoided, by not financing the car through the dealership.
In the case of bad credit, or credit history, applying to a credit union and financing the car yourself, is the more prudent way to go. When buying a car, the deal should be made on the ticketed price of the car, not on the monthly payments.

• The Dealer Preparation Scam for New Cars

To begin with, this cost is not only legal but fairly common practice. It is still referred to it as a scam, because it is merely another unnecessary way for you to end up paying more money to the dealership for the vehicle.

Primarily, the dealer will tell you have to pay an extra $500 to cover the labor costs of the dealership’s 5-point inspection. This means you are paying for the time it took, if indeed any time “was” taken, for the dealership to make sure that the car wouldn’t fall to pieces as soon as you drove it out of sight of the car yard.

You are paying for the labour involved in removing plastic from the seats etc, cleaning the car inside and out, and making sure that all of the fuses and fluids are actually there and the vehicle is ready to go. When factories deliver new cars to dealerships, the cost of delivery and preparation is already covered, so basically you are paying the dealership for work that they haven’t really done – and probably will not do in any case.

This ripoff can be avoided, by simply asking the dealership to add an extra $500 credit to the deal, that way at least it is not your money. If they refuse, the decision is then up to you as to whether or not the car is worth the money. If it is great; buy the car, if not; go to another dealer that will remove the dealer preparation costs.

• Forced Warranty Scam when Buying a Car

This is when the dealership finance manager tells you that you are not eligible for the loan by the bank unless you pay an extra $2000 for an extended 2-3 year warranty. This scam is just dumb. Basically the dealership finance manager is telling you that the bank thinks you cannot be trusted to pay back their $20,000 loan for the car, but they will trust you if you pay even more money. That’s just stupid.

This scam can be avoided if you can force them to put it in writing, that you “have” to pay the extended warranty in order to get the loan. That way you can bring a copy of the contract to your local State’s Attorney’s office, or lawyer, to verify that the deal is valid. The dealership finance manager will change his tune pretty quickly, guaranteed.

• The VIN window etching scam

VIN means: Vehicle Identification Number, and Window Etching, is a where  your VIN is actually etched onto one of the windows of your car, as a security measure in case of theft, or ownership dispute of your vehicle. Basically a dealer will charge you $300-$900 for window etching and they will tell you that you have to pay this to get the loan, because the banks insists on it – this is an out-right lie.

Some dealerships might tell you that the etching is free and then go and add the cost to your monthly payments, to make up for it. The best way to avoid this scam is to force the dealer to put it in writing if they say that the etching is free. Then again, you can etch the car yourself. You can get an etch-it-yourself kit from Vinshield for $19.95 or just don’t buy the car.

Remember a lender doesn’t require that you purchase any extras on a car. All the lender cares about is that you can make your payments on time regularly. Don’t buy into it.

• The Credit Score Scam

This scam is just stupid, at best, and is tried on everyone; good or bad credit. This is when the dealerships finance manager informs you that your credit score is lower than it really is so that they can get you for higher interest rates.

This scam is easy to avoid. Just get your own copy of your credit report from Equifax, or somewhere similar, and bring it with you when you go to purchase a vehicle.

It is really difficult to lie to you, to your face, about your credit score, if you have your own copy of it. If your documents and theirs don’t match, go somewhere else because that particular dealership is lying to you.

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