Top 10 SCAMS at New Car Dealers (Car Buying Risks) Kevin Hunter the Homework Guy
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- Опубликовано: 8 дек 2024
- Car Dealer Scams, including old tricks and new tricks by car dealerships, presented by Kevin Hunter and the Amazing Elizabeth, The Homework Guy Team, home of the ONLY Hassle Free Car Buying Service.
Thinking of buying a car? Then you're probably like most consumers - afraid and anxious about being ripped off by a Car Dealer. And, your fears are well justified! Consumers in the U.S. lose well over $30 billion each year to car buying scams, many of which are easily avoidable while others may require a little expert help.
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Tricking You Into signing a Lease
This is a “lowered payments” game. You're looking to buy a car, but you say the payments are too high. Salesman says, if we can get the payments lower with no cash down payment, will you buy today?" The problem is, they are putting you into a lease instead of a purchase. Some buyers get bumped into a lease without even being aware of it. The salesman may refer to it a balloon payment.
All we can say is that you MUST pay close attention to the agreement and make sure you are NOT signing a lease. This scam works mainly on people who are tired and in a hurry, and simply aren't paying enough attention.
Negotiating on the "Wrong" Vehicle
Dealer will mislead consumers by giving you pricing on the wrong vehicle. For example, you may think you're negotiating for a 2023 model, turns out the dealer was negotiating based on a 2022 model, a year older and with more miles. In rare cases this could be a legitimate error on the part of the salesman, but if you suspect they're doing it on purpose, take your business elsewhere. You can help avoid this problem by requesting a VIN and then using a professional advice source like our help desk with Elizabeth to look up the vehicle and verify it is what they are claiming it is.
Topping the list at #1 of new Car Scams are Confusing Window Stickers. This one earns a risk level of 8, because we’ve seen dealers pull this so often. Everyone is aware of what a Monroney Window sticker is, right? The official window sticker from the manufacturer. It’s NOT supposed to be removed or tampered with.
Here’s what happens: the Dealer displays a "dealer sticker" next to the official MSRP. It’s what’s commonly known as an Addendum sticker. It is purposely designed to look official, but its only purpose is to fool buyers into paying more for the vehicle.The dealer added sticker will include options that were installed AFTER the car arrived on the dealer lot from the manufacturer. They're usually worthless and some aren't even options at all, but simply made-up charges. For example, you might see things like "Special Value Package" which includes fabric protection, or charges labeled ADP or ADM. Interestingly, this is an offense hiding in plain sight, because ADP and ADM acronyms stand stand for "Additional Dealer Profit" and "Additional Dealer Markup". They are generally always completely worthless, and some are even fake fees!
The good news is that YOU can easily learn how to spot a fake dealer sticker. This begs the question: Why do dealers do this? Interestingly, contrary to what many people think, dealerships don't actually make most of their profit on the sale of new cars. The car is simply a product to be sold that unscrupulous dealers find a lot of ways to add tons of other stuff to.
The fact is that most dealers make more profit selling you add-ons than they do on the price markup of the vehicle. Car dealerships are just like any other competitive business, and they can and most often will try to maximize these profits in any way they can. The law requires that each new vehicle display a MSRP sticker listing the price of the car plus all the options and a destination charge from the manufacturer. A prot-tip right here: The fact that a destination charge from the manufacturer is right on the window sticker, clearly demonstrates that a destination charge is ALREADY charged in the MSRP. DO NOT let a dealer itemize it and charge you twice for it.
I have a theft protection system on my Nissan truck - it's also called a manual transmission or clutch pedal
YES you are absolutely correct my friend
I own a 1971 SeaGrave FD engine for showing at public events 😊 I do all the touch-a- truck shows and any local kids day event, farmers market. Any event so kids can get in the driver's seat and parents also 😊 It's amazing the looks I get from the parents saying your Fire engine 🚒 is a manual transmission. I say YES the automatic transmission did not get BIG in FIre equipment till the 1980s.
They can't believe it's a 5 speed. I love driving her, that screaming 8V-71 Detroit Diesel mated to that manual transmission shifting her by matching RPMs to speed.
The other theft protection That my Engine has is the Air build up till brakes will release. And the big one with Detroit Diesel is the Emergency Air shut off on the engine, it prevents the engine from STARTING 😊 even the salesperson at lot when I got her, had to show the sales guys how to reset the emergency shut off ( it needs manual reset) they were pushing the button on dash for emergency STOP to kill engine instead of pulling the regular engine kill lever, I guess they thought that was the STOP button. The salesman wanted to go and film riding with me driving her when I test drove her, and were very interested in learning the tips I showed them on start/ stop tech. It has TWO start buttons, the normal residency on FD equipment, you use both to START the old girl up, they were just using one button. The engine had been a trade in on a sale and dealership was using it for their little league baseball sponsorship. But the financial manager wanted to clear her off the lot, it took up too much room, the used car dealership was not that big.
Nobody wants it good for you!
Lol, that will certainly stop many people from trying to steal it!
Ok boomer
@@sneakerfreak2002We found a child that can't drive.
Great show again Kevin and Elizabeth. These new car dealerships are always thinking of ways to deceive the non suspecting public. It’s really very sad but telling that people like this are even permitted to own a new car dealership.
Exactly!
The second you encounter a scamming car dealer, just get up and leave. Don't go back , and post on social media to tell your neighbors and friends to avoid them.💯👍
Good points! Thanks for commenting!
I saw a lady with a big sign on a stick, picketing a dealer. That was 40 years ago, it made such a impression on me I still remember her, and the dealer. Tynan's Volkswagen, Denver.
I got bamboozled into buying a LoJack system on the new truck that I just purchased. After putting up a fight, they lowered the price a few hundred dollars however with the trade-in that I had, this dealer offered me at least five grand more than the other two dealerships. So all in all it was a much better deal out the door than any other dealership that I dealt with. I felt this was a win. I also had a second trade-in but rather than trading it into this dealership I shopped around as well and found another dealership that paid me $4000 more.
Thank you for your great videos and advice!❤
I managed to buy a new Subaru Forester, where games were minimized. A straight deal, with no offering of
nitrogen, theft protection, plus. I even asked for OTD price, and got that, without the patent deceit from so
many dealers I had contact in the process. And they call others crooks.
Waiting for dealers to charge for helium-filled tires. They could claim this would make the car lighter and get better gas mileage.
Lol
Don't give them any ideas 💡
4:13 - That's why I love this channel.
Aah... BS! Lol
The fact that we have to be aware of all these scares means the car buying system is completely broken and dishonest. We allowed this to happen and dealers don’t get punished. Sad.
Back in 1997 I was 10 years old and I remember going to a dealership with my parents. After being there for hours and finding a vehicle they wanted, test drove and everything… when they were in the office signing paperwork it was suddenly revealed that the price was wrong and that the vehicle they wanted to purchase was actually more expensive. So they could either pay the higher price or luckily for them the dealer just happened to have the same make and model a little older, different color etc. but for the same price they thought they were paying. My hard working immigrant parents could not afford to pay for the one they wanted so they chose the older one. That vehicle had so many issues and was constantly breaking down. Shame on dealerships who acted/act this way. Good thing that dealership is no longer in business or I would to this day still write a negative review. That’s an experience I’ll never forget and I immediately learned something from. Still upsets me to think about.
There is a dealer in my town, they have Addendum sticker next to msrp sticker.
Nitrogen filled tires and wheel locks $399.00
Wtf!
Plus on the same sticker, complimentary lifetime power train warranty.
This dealer already had past history and they are doing another one.
LAst time I bought a car, I did just as you mentioned. I asked to see their car to see if the tire values were green. They weren't on the salesman Ford. Funny thing is, I was looking at a Toyota of top of it.
Take pictures of your new car at delivery
Good info as always.
Inventory busting at the seams... lmao KARMA is a bitch. Thanks for helping to RAISE awareness.
7:26 , my confusion is turning in my leased car and getting a new lease on another. I may have gotten duped on this on my last lease by turning it in there. What cam you tell me😊
Rick Case Hyundai in Ft. Lauderdale scams you in every way that you just mentioned. Avoid any Rick Case Dealer at all costs!
I’ve seen lease agreements & finance agreements show the dealer charging for a tank of gas when it’s included on the window sticker.
Dealers scare customers about LoJack. It’s still being sold. I thought they were joking telling them that was popular in the 90’s.
Ive been looking at used trucks lately. Caught two dealers w 900 nitro tires....literally said ur joking right...
Unbelievable that some are still trying to charge for nitrogen filled tires, right?
@@KevinHunter i could understand like 100 bucks maybe...thats nothing. But almost a 1k here in kcmo.....gtfo
Don't forget about the $4999.00 cost for the ceramic coating. I saw that at a Lexus dealership. The Sales manager must have been high on drugs. 6:07
Where can I fink a link to the FTC regulations that car dealers must follow? Thanks
I'm an old dude and truly believe there are NO honest stealerships. They screw you somewhere, price, finance, warranty,add ons, service etc. They don't know how to be transparent and honest even though they all say they are more than their competitors....
I truly believe if they were transparent and would show customers a breakdown of deal they would sell more vehicles. People would not dread buying a car and would buy more often. We know they need to make a profit, but they go overboard and make the process miserable. They could survive with making less profit and sell more cars. I would buy more often if i knew i wasn't getting bent over and dread the whole idea of vehicle shopping.
Dealer doc fee i argued down from 900$ to 200$. Boy were they p.... was end of month and threatened to walk.
Nice work!
when do I ask for the manufacturer rebate, with the salesperson or the financial office?
Thanks
Im waiting foe the used car video. Im interested in buying a used vehicle asap but im gonna need help. I will be calling Kevin Hunter the homework guy when the used vehicle video comes out.
It's already at the editors!
Awesome 👌🏽
Hi Kevin
Went to buy a Wrangler at a dealer in Virginia. They gave me a price that was a few points below the MSRP…then they tired to add the shipping back into the deal. This resulted in a new price that was higher than the original MSRP which of course INCLUDES shipping. Scumbags.
Don't negotiate in the showroom, you will lose. They do this dozens of times a week - you once every couple of years. Get everything in writing by email if you can. Go to a dealer once to test drive a car, then go home. Get all pricing together remotely in the comfort of your space, not the dealer's. Go back to pick the car up. Once you agree to buy a car tell the salesperson to go to the finance department and get all the paperwork and send you a copy. If you need to go to finance it should only be to sign the legally necessary paperwork - nothing else. This strips all the power away from the dealer and puts you in charge. If a dealer says no move on to one who wants to sell you a car.
Always make a dealer EARN your business!
Another great dealer add on scam is the locking wheel nuts. These are 4 ( one per wheel) special nuts that need a special key to remove. They cost maybe $10 wholesale and the dealer charges $65-95 as an add-on. But the margin is not the biggest scam, its the fact that NO ONE STEAL WHEELS ANYMORE. its quicker to steal the whole car than the wheels alone. Locking wheel nut are such outdated technology it the equivalent of buying a Blackberry phone in 2024 vs 1995.
Do you help with Harley purchases too ?
Text Liz with your question at 701 441 3399. I'm quite sure the answer is Yes
The final rule was supposed to be effective on July 30, 2024, but there was a law suit I believe by the NADA. Any updates if it survived the law suit? Finally will you being doing an update video when it is effective?
Hi Elizabeth
What about options like special floor mats, door edge, trim, etc. that the manufacturer adds and are listed on the MSRP sticker? Is it reasonable to say you don’t want them and expect the dealership to keep them then reduce the price by that amount?
If it's installed by the manufacturer, you're usually stuck with it.
i bought a new truck we agreed on taking off window edging so we went to the finance office we signed papers they didn't gave me contract copies instead they gave me a usb only to find out when i got home it was empty when i went to get copies of the contract window edging was in there!
Go back and insist they take it off. Dealers should not get away with committing fraud.
Wow, in the shortage Toyota was only selling with deposits. Admittedly, they were cars coming in.
Kevin, didn't the updated FDA rules pass the court case and banned al the things your talking about?
You mean FTC rules. The implementation date was set for July 30, 2024.
Them car dealers gonna put a hit on you if you keep telling the truth on them.
Try charging the dealer a Satisfied Customer Appreciation Monetization fee, let’s call it SCAM FEE. I’m thinking $999.99 for starts.
When I bought my 2005 Taurus there was thousands in rebates from Ford. I was sitting at the table with the sales people and I gave them my offer. They came back with an offer THOUSANDS MORE. I grabbed my keys off the table and told them, just because Ford is offering $4000 in rebates doesn't mean you get to keep it and I started walking. They chased me out into the parking lot and sold me the car at the price I offered. They had a dozen of those cars and they have been sitting there for 6 months.
Walking out is a very effective negotiation strategy! We've always said that!
I just bought a new 2025 Honda CRV Hybrid 2WD Sport L Urban Gray for $38K OTD including Tax, Title, Registration, windows tinting, Mudguard, all season mats and Cargo Tray. Is this considered as a great deal?
Did you also get the engine and transmission?
How do you fight the freight ship charge? since I can’t find anything online for it to show them if they insist? Online it says it has to be paid and not in the msrp
If you're talking about the manufacturers freight shipping, you technically can't negotiate that off the price. It is a required fee. It's usually added when you "build and price" a car directly from the manufacturers website. You can, however, try to negotiate the price of the car down by whatever that freight cost is. Any freight costs added by the dealer, just walk out. Don't waste the time fighting that battle as that is likely not the only shady thing their doing.
Do the math on the window sticker. It most definitely IS in the MSRP!
Dont leave a deposit? but then when the car someone wanted to think about gets sold the dealer is the bad guy for "selling it out under me" ... I have had bad reviews left, and people screaming in my store because they didnt leave a deposit on a car and we sold it.. what dealer is keeping deposits in 2024??!? The deposit is for the customer not the dealer... why would we want to hold a car vs. making it available to anyone???????
It's good you don't play games with it, but unfortunately, it's a pretty common complaint around the country. Yes, in 2024.
Dealers are quick to take a deposit but will string you out for weeks to get it back - that's the problem.
@@garyjarvis2730 absolutely never in my experience, I do refunds on the spot
I got screwed over buy a extended warranty with arbitration clauses that void the warranty or obligation to refund. This is 2nd largest car shady dealership. Cascade is owned by B*!!y G
There are a lot of con artists in the extended warranty business.
The way it's mostly/always been & I know from the inside for 20 + yrs. Would car dealers do less of this bs if they made more on the car itself? Likely no, but let's not put them all in the same pot. I have worked for honest & shockingly dishonest ones. It's definitely buyer beware. Capitalism at its extremes, at times. I believe yr. assistance likely would aid some ppl. & yr. fees are reasonable. (considering how much $$ is at stake.). I had thought of doing what yr. doing as a side hustle to SS & do advise friends, family.
Why do dealers want to see your driver's license & Social security number even if you are not financing
They claim it's for identification purposes, but that's enough info to run credit on you.
@@KevinHunter Why do they want to run a credit check when you are not financing the vehicle.
Why are we still required to buy a new car at a dealership? I realize laws are still on the books, but dealerships have really become unnecessary.
Yes, that's what the laws say. The dealer lobby through organizations like NADA has influenced a lot of public policy. That might change some day.
You’re just regurgitating info
Hi, I’m in the process of to buy a Toyota Highlander xle 2022 with 21,454 miles. Price is 33,557.
And the total price out of the dealer is 37,850. This is a good deal? Please help me. @kevinhunter
This is what they are charging on Documentary Fee
Clerical Expense $696.25
Computer / Document Delivery Services $102,75
799.
That doesn't sound like too bad of a deal to me.
@@KevinHunter thank you 🙏. I really appreciate.