3 Red Flags to Watch for When Buying a New Car

Being in the market for a new car is exciting; trying to actively avoid being scammed is not. It doesn’t matter whether you’re buying a new car off the lot or a used vehicle from an independent owner—either situation presents the opportunity to get ripped off. Cars are no small purchase, with price tags ranging between a few thousand dollars to fifty thousand dollars and up.

Making a bad investment can put a serious dent in your finances and overall quality of living. The key to avoiding common car scams and driving off in a purchase you can feel confident about is to keep a keen eye out for these three red flags. Pay attention to these warning signs and find a set of wheels that gives you no cause for concern.

#1: Lies about Your Credit Score

When you’re shopping for your dream car, there’s a high probability that you’ll need to finance the purchase. Unless you can drop roughly $100,000 cash on a Lotus Evora GT, you’ll have to work out a financing arrangement with your car salesman.

Car salesmen are typically extremely greedy people with decades of experience developing their ethically-questionable sales tactics. One common way they’ll take advantage of unsuspecting shoppers is by lying and telling them that their credit score is lower than it actually is. A credit check is a necessary step in the financing process when you buy a new car because the seller must know that you are credit worthy and capable of making your car payments. The lower your score, the larger risk lending risk you present, and the higher APR they can charge.

To avoid paying unreasonably high interest, make sure to run a free credit check on yourself and head to the dealer confident about your score. When the salesman tells you otherwise, spot the red flag, call their bluff and walk out the door.

Pro-tip: If your credit score is on the lower end, you might consider taking the time to build it back up before buying a new car so that you get the best deal possible. Another suggestion is to wait and save up to pay for the transaction in cash in order to reap the benefits of the Benjamin.

#2: The Bait and Switch

Imagine this: let’s say you’ve had your eye on a covetable Toyota 4Runner. You’ve done your extensive research and know that you want the 2017 model because you smartly and patiently waited for the value to depreciate. You know what color you want, you call the dealer ahead of time to confirm they have the vehicle in stock.

But when you show up, they say that car is no longer available. Instead, they show you the keys to the flashy 2020 release, point out the enlarged infotainment system with smartphone compatibility, the new USB ports, keyless entry, push-button start, and make sure you see the ultra-stylish Nightshade Edition with black chrome accents.

Suddenly you’re driving off the lot surrounded by unnecessary luxury features and car loan you can hardly afford—you fell for the classic bait and switch scam. Don’t be this person! Instead, call the dealer before you arrive and confirm their inventory of your desired vehicle. Then request that they fax or email you that exact confirmation along with the car specs. If you show up 30 minutes later and are told the car was sold and no longer available, you’ll have proof that they’re lying. No sale closes within that short of a time frame. Identify the red flag and take your business elsewhere.

#3: No Test Drive

This is incredibly important when shopping for a used car, as third-party sellers and independent owners have far fewer regulations to deal with when selling a car compared to the official dealerships that are backed by manufacturers. If someone tries to sell you a car without first letting you drive it, walk away.

No one should have a problem with allowing you to test drive a mechanically-sound car that boasts a clean interior. Maybe it looks great from the outside, but the A/C is broken, one window can’t roll down, the brakes screech, or a number of other problems you would only be able to detect from experience driving the vehicle.

Don’t wind up with a lemon and don’t get duped by a salesman—watch out for these red flags when buying a car rest easy knowing you’re a savvy consumer.

~ by velofinds on September 11, 2019.

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