Car Dealership Tricks That Can Cost You Thousands

Additional Coverage:

10 Car Dealership Tricks That Cost You Thousands (financebuzz.com)

Don’t Get Played: How to Outsmart Dealerships When Buying a New Car

Buying a new car should be an exciting experience, but let’s be real – it can often feel more like a high-stakes chess match. Some car dealerships are notorious for deploying a playbook of questionable tactics designed to squeeze every last dollar out of unsuspecting buyers.

But fear not, savvy shopper! By recognizing these common ploys, you can arm yourself with bargaining power and know exactly when to walk away.

Understanding these tricks of the trade isn’t just smart; it’s a critical move for your wallet.

Here are some of the most common ways dealerships try to get you to pay more:

1. The Extended Warranty Hustle

Is an extended warranty a genius safeguard or a glorified money pit? The jury’s out, but one thing’s for sure: buying one at the dealership often means you’ll seriously overpay. Unless you’re hit with an unforeseen, catastrophic repair right after your manufacturer’s warranty expires, most consumers won’t save money with an extended warranty – and could even be out thousands of dollars.

2. The “Ideal Monthly Payment” Trap

Many dealers will try to hook you by asking for your “ideal” monthly payment. This is a classic bait-and-switch.

Once they have that magic number, they can stretch out your loan for an extra year or two, making a pricier vehicle seem affordable. In reality, those extra payments can cost you a fortune in interest over the life of the loan.

3. The Financing Switcheroo

Imagine this: You’ve agreed on terms, but then you’re presented with a new financing sheet that has higher monthly payments, a different interest rate, or even a completely new format. To avoid this shady tactic, always keep a copy of your original agreed-upon terms. Double-check that the vehicle price, down payment, trade-in value, interest rate, loan term, and monthly payment all match what you shook hands on.

4. Sneaky Delivery Fees

A relatively new trick in the book is the “vehicle delivery fee.” Dealers might claim you need to pay extra for the manufacturer to ship the car to their lot.

This is simply not true. The “destination fee,” which covers this cost, is typically already baked into the sticker price.

Don’t pay for the same thing twice!

5. Unnecessary Sealants and Coatings

Modern cars come off the assembly line with paint designed to last the life of the vehicle. There’s absolutely no need to shell out for extra sealants or rustproofing from the dealership. “Extra sealant,” “surface protection,” and “fabric protection” are just fancy phrases for unnecessary fees.

6. The Credit Score Lie

Dealerships know that excellent credit means better loan rates. Some unscrupulous dealers might tell you your credit score is lower than it actually is, tricking you into higher interest rates and missing out on valuable incentives. Always check your credit score with all three major credit bureaus before you step onto the lot.

7. Overselling Features (The Dream Car Narrative)

A dealer might spend an excessive amount of time gushing about a car’s premium sound system, lane-keeping assist, or panoramic sunroof. This isn’t just showing off features; it’s an attempt to create an emotional connection, painting a “rose-colored” picture of your life with this dream car. Once you’re emotionally invested, you’re more likely to accept an inflated price.

8. Unwanted Car Alarms or Tracking Systems

Many new cars already have alarms or tracking systems, and some manufacturers offer subscriptions for these features. Local car electronics stores often sell and install these systems for less than a dealership.

Some dealerships, however, install them on every vehicle as a “theft deterrent.” If you don’t want to pay extra for one, make sure to request its removal before you finalize your purchase.

9. Yo-Yo Financing (It’s Illegal!)

This scam, also known as the “yo-yo scam,” is against the law. Unethical dealerships might contact you after you’ve signed paperwork and driven your new car home, claiming your financing fell through.

They then present an ultimatum: sign a new deal with a higher interest rate or lose your vehicle and down payment. If you suspect you’re a victim of yo-yo financing, contact the Federal Trade Commission (FTC) immediately.

10. The “Limited-Time Offer” Pressure Cooker

If a dealer senses you’re on the fence, they might try to pressure you with phrases like “this offer expires today” or “we have other buyers interested in this car.” This tactic is designed to force you into an emotional decision, hoping you’ll agree to pay more.

If you’re not entirely sure, be prepared to walk away and think it over. Don’t let pressure lead to overpaying.

The Bottom Line

Financially savvy shoppers know that securing a great deal at the dealership means paying as much attention to the salesperson’s tactics as to the car itself. Otherwise, you risk falling for misleading tricks that could cost you thousands. Just like comparing auto insurance rates to save money, always shop around and compare offers from multiple dealerships to ensure you’re truly getting the best possible deal.