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3 Tips to Avoid "Scams" and Bad Deals

by Scott Stillings - Posted 2 years ago

3 Ways to Avoid "scams" or Bad Deals when Financing a Car!!


You've probably noticed Dealers have fewer and fewer vehicles on their lots. The demand for vehicles is SO much higher than the supply right now, and Economists aren't predicting that to change for at least 6 months!!

If you're in the market for a car, here are 3 tips to help you spot too-good-to-be-true deals that will cost you extra time and money!

#1 - COVID-19 fees

Every dealer is legally allowed to charge a document fee or dealer fee, and almost every one does. Those fees are typically reasonable, and are around $500. They cover the expenses of license plate and title work, saving you time at the DMV.

In this COVID environment, there are many dealers who are tacking on COVID fees that don't cover any costs - they're just pure profit for the dealer. Make sure you ask about ALL the fees when discussing financing a car.

#2 - No Credit Check Loans

When using Income-Based financing, lenders and dealers understand the typical credit situation that they're customers are in. They are understanding and forgiving of credit mishaps and issues.

Dealers who are touting that they don't check credit are likely doing some combination of: not showing you their nicer vehicles, asking for extremely large amounts of money down, charging extra fees, and/or unaffordable monthly payments.

Don't be afraid of your credit! Take a look at it before you go looking to finance a car. It may not be as bad as you think and you'll save yourself some down payment money and be able to keep your monthly payments affordable!

#3 - Down Payment Increases

?Naturally, everyone wants low down payments! Dealers know this too, and they run advertisements all the time talking about "No Money Down" or a very low down payment. We run those same promotions, so we're familiar with how they work.

Once you get to the dealership and pick out a car, when you get to signing the paperwork, that is when the additional down payments come out. Down payments for taxes. Down payments for license plates. Down payments for fees, and on and on...

Dealers should be up front with you about their down payments. Ask them if they include all taxes and fees. If it's a promotional down payment you're wanting to take advantage up, good dealerships will tell you upfront that it's a promotion and how the promotion works.



If a Dealership or Lender isn't being upfront with you about their promotions and practices, how are they going to react when you need to change your payment method and need a couple extra days? Make sure you feel comfortable with the Dealership and not just buy a car because it 'looks nice'.

Hopefully these tips help you better navigate your next car purchase!