The Three top Scams Aimed at Car Buyers with Bad Credit

Loans direct from your car dealer are often more expensive than other finance options. You should also be aware that some dealers operate scams against this vulnerable group of people.

These are the three most common scams used by unscrupulous car dealers. Be aware of them when you consider getting both your vehicle and your finance from the same source.


Selling Cars Which Have Been Wrecked "As Is"

This is probably the most popular scam and you should always be aware of it when looking for a bargain on a car. Car dealers may not know the condition of every vehicle on their lot and may sell a wreck with no ill intent. However, some do know they are selling a wreck. Cars in poor condition are often sold "As Is", and as you take ownership of the car you'll be expected to sign papers saying that you accept the condition of the car. This means you have no warranty and no come back if the car falls to pieces as you drive away from the lot.

You can take precautions to avoid this. You should always get a Carfax report on your vehicle and to be extra sure to have the car inspected by a mechanic.

The Exclusive Fee Scam

Because it is so simple to carry out and because so many people fall for it, this is probably the most popular of all the scams used by unscrupulous car dealers.

Nothing about this scam is illegal and it simply relies on most people's honesty when asked to pay a bill; even if that bill is unjustified.

The dealer will simply post a second price under the price for the car and then when the sale is done ask you to pay that too. The usual claim is that the fee covers the dealer's expenses in preparing the car for sale: maybe for valeting, removing plastic car seat covers and so on. Most people will simply pay the extra fee but really you shouldn't. It will almost certainly be far too high for the services the dealer is claiming to supply. If you see this second price on a for sale sign you should make it clear you are happy to clean up the car yourself and do not wish to pay the car dealership to do it for you.

The Check Bounced Scam

Again, it's a very simple little trick and this scam is aimed at buyers who have their own means to buy their car. All the dealer has to do is convince you that the check you've paid for the car has bounced and that you should arrange finance through his dealership.