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  • Writer's pictureCarwam

How Not To Get Scammed at a Car Dealership

Updated: Oct 21, 2022

Car Dealership | Car Deals

First time buying a car? Well then, there must be a lot on your head. What type of car should I buy? Can I afford it? What’s the best car for me? And the list goes on… But those are just a part of the important aspects to consider. Money is one thing and the tricky part is how to get the best offer out of your money in a car dealership. Remember that in any car buy or sell, you are dealing with pros. As much as you would like to get the best out of the deal, they want the best for them too…so play your cards right and avoid getting ripped off your finances in a deal or worse, the loss and frustration of getting scammed at a car dealership. As much as it is an exciting event, buying a car can be stressful. Your decisions can change anytime with just a little persuasion on how the leather seats are so comfortable or how the color suits you and so on….Dealers are always potent and convincing and they know when to attack – so do your homework: research, have a pre-approved loan as much as possible, or know your credit rating and history by heart, and more importantly, know what you really want: be passionate and particular about it. With the evolution of the digital world, consumers are now buying cars online and like hackers, scammers are growing fast and they are everywhere. They have honed their skills pretty well too. That is why consumers need to know how not to get scammed by car dealers.

Here are Common Auto Dealer Scams you must know

  1. Bait and Switch – False statements about the price of the car – You walk into a dealership and a salesman gives you a price quote. But when you are preparing to finish the deal, the price on the contract is not the same price that you were quoted. You may also notice that your contract contains other fees that increase the Total Cash Price of your vehicle.

  2. Packing the Contract – Adding unwanted options and accessories – Some dealerships “pack” a contract with add-ons like service contracts, warranties, options, and accessories that you did not ask for. Common add-ons are “protection packages” and rust-proofing.

  3. Advertising Bait and Switch – Don’t be fooled by advertisements that offer a handful of vehicles for extremely low prices. Some dishonest dealers will claim that those few cars have been “already sold” and then they will try to sell you other cars at higher prices. Make sure to write down the VIN number in the ad, and search for the car in the lot yourself. Dealers are required to give you the advert

  4. Hiding a Lemon or Wreck – When buying a used car, watch out for cars that were previously wrecked, or cars that had to be returned to the manufacturer because of multiple repair problems (known as “lemons”)

  5. Financing Fraud – Lying about credit scores – Another common scam used by dishonest dealers is to trick customers into believing that you have bad credit. They may tell you that your credit score is too low and you don’t qualify for a low-interest rate. Demand a copy of your credit report, or get your own credit report free at

  6. Buy-Lease Switch – BUYING a car means that when you finish making payments on it, you will OWN the vehicle. LEASING means that there is a period of time – the lease period – when you’ll be making monthly payments on the car and at the end of the lease period you will NOT own the car (unless you make a large payment to own it). Plus, if you want to return the car before the lease period is over, you’ll have to pay a big penalty (an “early-termination fee”) to do that. Customers are routinely scammed when salespeople lead you to believe that they are purchasing when you are really leasing (and vice versa). Other misrepresentations include telling customers that you will own the car at the end of the lease. This is false because almost all leases require you to make a large payment at the end of the lease in order for you to own the car.

  7. Trade-in Fraud – Many customers who trade in their old cars are tricked by dealerships who are not truthful about the value of the trade-in. They might tell you, “A 1999 Toyota like yours only sells for $3,000.” But Toyota’s wholesale value may really be worth a lot more. Customers who don’t know what they can get for their car if they were to sell it today (the wholesale value) are likely to accept statements like these and may walk away with very little for their trade-in. The dealership will then turn around and sell the trade-in for much more. Research your car’s value on sites like Trucar or Kelley Blue Book before going to a dealer. A better option instead of trading in is selling the car to a private party, or to a reputable wholesaler/autobuyer.

  8. Co-signer Scam – When customers don’t qualify on their own for financing, dealerships often suggest that they get a friend to co-sign. Often, however, a salesperson will tell the co-signer that he/she is only signing as a reference to help the primary buyer. This is false. If you are thinking of co-signing for someone, you should know that the co-signer is equally responsible for paying the debt and can be sued if the primary buyer doesn’t make payments.

  9. Requiring Options – Some dealerships will tell customers that they have to buy additional options or accessories for them to qualify for financing, a special interest rate or a reduced price. This is not an accepted business practice and may be illegal.

  10. “Yo Yo Sale” – Typical Scenario: You purchase a car and drive it home. The next day, you receive a call from the dealership, informing you that there is a problem with the financing and that you have to return to the dealership. When you return to the dealership, the salesperson states that you did not qualify for financing, but that they can still process the deal at a higher interest rate (or with a larger down payment).

To add, here is a simple list of how to not get scammed when buying a car online:

  • Do your shopping on reputable websites

  • Never send money without meeting

  • Don’t believe the picture you see

  • Only use sites with secure transactions

  • Use secure and traceable payments

  • Don’t share personal information

  • Stay calm under pressure

  • When possible, buy local

So, have you decided yet? Is it going to be a cheap first car or the best first car? A used car or a brand-new one? How would you know the best car for you? Too many things to consider and a lot of factors to rationalize. It can be a bit overwhelming but research is the key. Start by looking at practical, trendy, and popular cars – their features against your needs. Compare prices and consider the cost of using it in the long run. Then narrow down your choices to at least 3 and you are good to go with what you think is the best car dealership near you or online. But, before the purchase – whether a used or a new car, never skip a test drive. It is one of the most important steps in any car-buying guide. You can tell a lot about a vehicle during a test drive. So make sure you take this step before you purchase.


Buying a car nowadays is not only a difficult undertaking but an expensive one. It can be sensational and immensely difficult at the same time given the details you have to consider and the choices you have to weigh. If you need to buy a car, consider all options outside of your local car dealers including an online listing platform like Facebook Marketplace or Craigslist where local people list their cars for free. You can also consider swapping your current car if you have one that is worth trading in.

The bottom line is not to get scammed when buying a car. Do your research and know what you need. Consider your finances in the long run and be mindful of too-good-to-be-true car prices or deals because there just might be something wrong in-between. But this do not generalize the car dealers, some of them are legit and would really want to help you. These are mere guides to avoid a scam. With the above things in mind, you might just have the best car at the best possible deal. So have fun and good luck with your purchase!


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