Next to their home, the second largest and most expensive purchase most consumers will make in their lifetime is the purchase of an automobile. Unfortunately, automobile dealers throughout the United States, as they have witnessed the increased need for automobiles in our professional and personal lives, have developed numerous ways to unfairly and deceptively increase their profit at the expense of the consumer. When dealers engage in these types of practices, even if the consumer has done their homework and honestly believes they got “a good deal,” we consistently find that the person most likely still fell prey to the “tricks of the trade.” Unfortunately, this is not the exception, but is generally the rule, and has become an interwoven part of the purchasing process that impacts the majority of people who are purchasing automobiles today.
The “tricks of the trade” involve a multitude of deceptive trade practices that the dealer has perfected down to a science. Some fraudulent behavior does happen right from the moment you enter the premises and starts from the moment they begin to draw information from you or set up the process of what vehicles you are shown and how that is done by the front sales personnel. But an even larger number of the “tricks of the trade” occur in the finance and insurance (F & I) department. It is here in the F & I department after two to three hours in the sales department where the vast majority of the “tricks of the trade” are perpetrated.
The most prevalent and common trick of the trade is called “stuffing”. In this practice, the dealer hides certain “add on” charges from consumer with regard to their vehicle purchase. These charges can vary in amount from as little as $100.00 to in excess of $1,000.00 added to that individuals’ purchase, without the consumer even knowing it. These charges commonly involve what are referred to as aftermarket items or products. These are products that the dealership either physically installs or applies to a new vehicle after it receives it from the factory, but this can also include insurance or warranty products the F & I employee will attempt to sell you just prior to signing all of their paper work to complete the sale. Many dealers will actually fail to itemize these charges on the consumer’s purchase contract under the heading “ITEMIZATION OF AMOUNT FINANCED.” This prevents the consumer from doing a “line by line” analysis of the true cash price of their vehicle, thereby effectively preventing the consumer from knowing exactly what they are paying for their vehicle. The “ITEMIZATION OF AMOUNT FINANCED” is mandatory on all retail installment contracts (your purchase contract) involving vehicle purchases.
Not all dealers engage in these practices, but unfortunately too many of them do. How can you tell if this has happened to you? You should look for the warning signs and contact us if any of the following circumstances were involved with your vehicle purchase:
- You signed a blank purchase contract, which is also known as a “retail installment sales contract” and/or “security agreement.” It is the extra long form contract that has all of the terms of your vehicle purchase on it.
- After you signed your purchase contract, the dealer did not give you a copy of it at the time you took delivery of your vehicle – on the very day you signed the contract.
- Some of the paperwork you were given by the dealer indicates that you purchased some sort of aftermarket product ( such as a paint sealant, undercarriage coating, fabric protector, theft protection aka “ETCH,” mechanical warranty or maintenance contract or GAP insurance contract, etc) but these charges are not identified and/or itemized on your purchase contract under the heading “ITEMIZATION OF AMOUNT FINANCED.”
- You were asked to come back to the dealership to sign another contract with different terms from the one your previously signed.
- You feel you were not treated fairly by the dealer in relation to your purchase.
- You feel you fell prey to misleading or deceptive advertising which caused you to go to that particular dealership.
