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Be Ready for These Car Dealer Tricks

In all of my years in the car business I have seen and heard of many, many different types of scams and dirty tricks played on customers. I put together some of the favorite and most common car dealer tricks that you should be ready for when you go to the dealer. These car dealer tricks are not something every car dealer does, but many do. Being prepared and on alert is the best way to protect yourself from these car dealer tricks.

Packing the PaymentCar Dealer Trick

Your friendly car salesman loves to talk payment. When you open up and start talking about how much you are willing to pay monthly your car salesman might start drooling. The payment buyer is the car dealer’s best friend. One of the car dealer tricks commonly used is “packing the payment” or “leaving a leg” where they inflate the payment higher than the actual amount. Your salesman might present you with a payment amount that is $50 to $100 a month more than you are willing to pay. Ideally the customer will raise themselves to somewhere between your amount and the dealers amount. If you accept a payment that is $40 over the actual payment, you would be paying an additional $2400 over the life of a 60 month loan. To protect yourself from this car dealer trick, do your homework; calculate the payments on different priced cars so you know the price range of the car you want to buy and can afford. When you salesman wants to talk payment, let them know that you are concerned with the price not the payment.

Is This a Trick?
Is This a Trick?

Swiping the Rebate Car Dealer Trick

I have seen many new car buyers that have come into the dealership because of advertised financing or rebates. When a customer does not qualify for the financing or the financing special term is too short, they opt for the rebate. Then the car dealer trick during negotiations where the dealer leaves the rebate out of the numbers. When you ask the salesman, they say that the rebate is included. However the sales manager gave the numbers to your salesman without the rebate. Now you make a deal and do all your paperwork without paying attention to the rebate, you are only watching the final number that you agreed on. The car dealer trick here is that the dealer is swiping or keeping the rebate. When there is a rebate from the manufacturer, the number should be listed on your paperwork. By read all your paperwork carefully before signing will protect you from this car dealer trick.

Qualifying Interest Rate Car Dealers Trick

A very common car dealer trick is to contract you for financing at a higher interest rate than you actually qualify for. There are many cars sold and financed at interest rates that are 1, 2, 3, or 5 percentage points higher than the buyer qualify for at a bank or credit union. The dealer profits the difference in rate. A couple of points in interest rate on a 5 year car loan can be a nice additional profit for the dealer. The homework that you do before buying a car needs to include shopping for car loan interest rates from your local bank or credit union. Getting rate quotes from other sources beside the dealer will help you when you go to the dealer. You can use the rates you got from your bank to compare to the rates from the dealer. The best way to avoid this car dealer trick is to tell the dealer what rate you got from your bank and if they can beat that rate you will finance with them.

The three car dealer tricks above are very common and can be very profitable for the dealer. There are many more car dealer scams and tricks, but these three can have a huge impact on what you ending paying for your car.

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