Top 5 Car Scams While Buying or Leasing
Car scams may be more common than people think, and it’s quite easy to fall victim if you don’t know how to recognize them. Scams can occur on both sides of a car purchase – from the seller’s side or the buyer’s. Here are 5 common car scams to look out for when buying or leasing a vehicle:
- Sleazy Salesmen
Not all car salespeople resemble the general stereotype. However, sleaziness is something you should still be aware of. Some unscrupulous car salesmen will say anything to make a sale, even if it’s untrue. Be cautious of car salesmen that rush you into making a speedy purchase.
Avoid falling for lines such as “someone else is interested in this vehicle”. Don’t ever feel pressured into making a purchase. BONUS TIP: shop online to find better vehicle deals without the pressure of a salesperson.
- So Called Deal Bundles
Deal bundles are packages that the seller might use to consolidate the vehicle sale with auto insurance and auto loans. These bundles may seem attractive at first, but they often cost the buyer much more in the long run. Use different organizations for different aspects of your car buying. For instance, you can search for separate loan acquisition or compare different insurance policies from top providers online.
- Quoting a Higher Price Based on Gender or Ethnicity
Unfortunately, even in this day and age, some dealers may quote women or minorities at higher prices simply due to bias. When possible, try to negotiate online or via telephone to minimize unfair treatment.
- Yoyo Financing
This is when car buyers with bad credit are tricked into paying up to 5% more than they should. In these instances, buyers are normally informed that their financing has fallen through just a few days after taking the vehicle. As a result, they are tricked into financing at a higher rate. Nicknamed “yoyo financing” because of the sudden price change, this is something you should definitely look out for.
- Overseas Car Buyers Sending Payment Via Paypal
This last scam is one to watch for if you’re selling to a long distance buyer. Here’s how the situation goes: 1) Buyer claims issues with freight company. 2) Buyer offers a higher price if the seller pays the freight cost. 3) Buyer requests an exchange over Paypal, which allows them to pocket the money.
Avoid paying through Paypal if you can help it and meet buyers face to face whenever possible.