Car Dealers' Worst Tactic Under Fire 

This sounds to me like a good reason to arrange financing with your credit union BEFORE you go look for a car.

I worked for Vista Chevrolet about 20 years ago. I sold a young single mother a car. She had saved for months for a down payment. I helped her find the perfect used car. She left the dealership happy and I felt good about helping her. The lot manager came out and put a hand on my shoulder and told me they would be reposessing the car within a week or two because she didn't get approved for a loan. They knew before she left the lot and still took her money. I quit the next day.

When Steve read that they were awarded $225,000, it brought a huge smile to my face.

I learned how to play their game against them at an early age. I went in and pretended like I was ignorant, poor and incapable of getting a car loan, negotiated a below market price for the car and financed the car at highway robbery level interest rate through the dealer. I then came back the next day and wrote a check to pay off the lucrative loan and they were pissed. I paid not a dime of interest which is their bread and butter.

A dealer in San Diego tried this with me when I was stationed there in 1996. It was for a brand new 1997 Jeep Wrangler and a month later they called me back to try to get me to sign “new paperwork” that had something in the 30% interest range. I laughed at them and went to base legal. Evidently, the JAG lawyers knew this dealer quite well. A few weeks later I was told to return the Jeep but beforehand, take it over to Fiesta Island and have a good time with it and that no matter what I did, it would be ok. Well you don’t tell an E-1 sailor that, we tore that thing up!!! Tore the front bumper plastic off, scratches all down the side, a small tree lodged in the skid plate, and no gas….the salesman almost fainted when he saw the Jeep as I’m pretty sure he got fired. Never heard anything about it again…

Back in 1999, I bought a used 1996 Dodge RAM from a Dodge dealer somewhere around Sacramento. A couple weeks later they tried this with me. I knew it was BS, so I said okay, just come get the truck. They refused, and insisted I sign new papers. I said no, come get the truck. This went back and forth several times over a few days and I said the same thing every time. They finally just gave up and I kept the truck with the original terms.

This happened to me in 2019, the dealership called up a week after I signed the contract and said to come in that there was a problem with my financing, when I got there they said my interest rate was going to be 11 percent so I threw the keys on the desk and demanded my car back they ended up sticking with the original deal. I learned along time ago that you should never buy something your not willing to walk away from..

A local dealer tried this crap on my son and daughter-in law. My son asked me what he should do, and I told him NOT to give then the additional $1,200.00 the dealer was demanding, and I would handle it. I went to the dealer, asked what was the original selling price of the car, and what was the out the door cash payoff. They were surprised, but gave me a figure. I took out my checkbook, wrote out a check for that amount, and told them to give me a "paid in full' receipt. I later told my son he could make his monthly car payments to me, (with 0% financing charge). Bottom line; before shopping for a car, save up any down payment you might need, get pre-approved for an Auto Loan from your bank or credit union, and never do a "trade in", (sell your old car yourself after taking delivery of it's replacement). When the dealer starts talking "finance", give them the name and phone number of YOUR lender.

Another thing dealers will do is have a listening device at the salesperson's desk. He will say that he has to go see his boss about approval of the price. However, I noticed that I was waiting way too long. I suspected a listening device as they wanted to hear our discussion about the deal. To test it, I said " lets get out of here" Right after that the salesperson came running back. Watch what you say as they are listening.

I remember this happen to the first time I bought a car as an adult. Being from smaller town, went to larger dealership. When they tried the yo-yo move, I decided "nope I'm not going to play that." I told them to come pick the car up. I didn't have a trade-in that had to be dealt with, and told them I refuse to assume the liability of driving a car that I no longer owned nor was financing to own. The salesperson, and one of his co-workers had to drive to pick the car up. It was Memorial Day weekend. Found out later from a friend who knew the car, that the salesperson got stopped at a DUI checkpoint, and blew past 0.08.

This happened to me at Acura of Columbus in 2005. Sales manager got really rude with me and told me "what I was going to do" after they told me my trade was gone. I hung up on them after I said I was going to hire an attorney. Somebody else called me back saying "please dont do that in a super soft nice voice". Ended up just using my own bank.

I "yo-yo'd" a crappy dealership once. My mom got taken advantage of by a dealership that lied about her income to get a ridiculous loan for a ridiculous car. Thankfully, it happened on the Saturday before NYE so I was able to drive 2 hours from Indianapolis to South Bend, show the financing institution a tax return of my mom's, and get them to ask the dealership for income verification. If it weren't for the influence of your videos, I probably wouldn't have known to do that. Your channel is a treasure! I think I even messaged you about it on FB at the time, but just as a rant (not for help, as I know you're in Michigan and I'm in Indiana).

There was a car dealer group in the Atlanta area that was doing the 'not paying off loans of traded in cars' trick. Eventually the car finance companies cut them off and they were closed the next day.

Every time that I have purchased a car through a dealership, I let them arrange financing through the dealership and let them "rip me off" on interest rate but then negotiate the price of the car. They are willing to lower the price because they are getting the money back through the interest rate. Then I go to the DMV and take care of business. Then I go to my credit union and refinance the car to a lower interest rate. I pay off the dealership loan. That way they cannot come back and say that financing didn't go through. I sleep at night knowing that my relationship with them is over.

In my state, they solved the problem by enforcing a state mandated sale contract for cars. There is no fine print. And going to court is way easier for everyone. The first thing the judge does is check if the contract correct. Also, they can’t give you the car until the sale is final.

This is the kind of thing that's made me avoid dealerships. I pay cash for my cars--so I never have to worry about anything more than "Did I buy the right car?" I've been aware of some of the games dealerships play since I was a kid...and even if I decided to buy a car using financing, I'd get the financing through my credit union, not the dirty dealership. It amazes me sometimes, how car salesmen earned themselves a truly horrible reputation, but don't seem to care about it enough to change their behavior. I suspect that, just like politicians, many/most of them are sociopaths.

I work at a Ford dealer inspecting and repairing the trade ins. We don't touch them till the financing has gone through because a few times we have done all the needed repairs, brakes, tires etc. and the deal falls through. Customer gets his car back all fixed up.

I bought my last car on a Saturday. The dealers are perfectly capable of running this thing called a ‘credit report’ at any time. They did not have to take my word for it.

I was working at a Southern California Mazda/Mitsubishi dealership that was also a Yugo dealer. They sold one Yugo and the financing fell through, so the man brought it back, no problem. The dealership decided that THEY'D carry the paper (at close to 0% interest) so they wouldn't have to take back what nobody in their right mind would have bought in the first place.

Steve, I'm retired now but I used to be an independent auto dealer in Washington State. I also was a member of the Washington State Independent Auto Dealers Association (WSIADA). The member benefits were current standardized legal forms, informational trade journal, limited attorney consultation and a funded State lobby effort. Good deal, right? Pretty much good except for the lobby. Turns out the lobby effort provided push back on any consumer protection legislation that, in effect, emboldened the worst retailers in the State. Yes, they made matters worse for the honest dealers and consumers. Bad laws allow consumers to get tricked into raw deals and provide little recourse for remediation. Meanwhile the honest dealers lose out on sales and the public gets a bad beat. This topic needs to be exposed.

I had a dealership nightmare back in 2014. I paid cash for a 2006 Mercedes s600 and when I went to have it registered discovered it had a lean against the title for $8500. I contacted the dealer who told me that the dealership was in a lawsuit with the original owner who took out the loan on the car the same day they traded it in to cover the down payment on the new one. I fought with the dealer for 18 months while they kept sending me 30 day temporary tags every month and a couple $50 prepaid gas cards each time and covered the Benz with their dealers insurance until the state finally threatened to take their dealers license away prompting the dealer to offer me a full refund for the car back. Yea while it was a nightmare i basically drove that v12 Benz for almost 2 years without having to pay for insurance or gas and got every dime back I’d paid for it.

There is a dealer in the area where I live where they advertise a new car at a very low price. When you call them about it they will say the car is still there and will be there when I come down to look at it. However, the car never existed in the first place and they only push on you a more expensive car. 10 years later I saw another car at the same dealer with the same low low price. I called and grilled the guy and got him to admit the car does not exist.

This practice is so scandalous. This happened to my fiancee a couple of years back. Her trade-in was already paid off, and of course buy the time she was notified that they were taking the car back her trade-in was supposedly sold already and they left her completely empty handed. Downright despicable.

Something similar happened to a coworker about twenty years ago. He went into a reputable dealership to purchase a used truck. He traded in his sedan for a nice truck (signed all of the paperwork) and left the dealership. Less than a week later the dealership called and asked him to return the truck because of financing troubles. My coworker even said himself that his credit was less than stellar and he was surprised that he got financing at all. He returned the truck only to find out that his sedan had been sold. The dealership did, however, get him financed on another truck. He left satisfied. I worked at a large car dealership that was in my family for many years. A young couple came in to purchase a new but modest vehicle. The sales manager told me to put their trade in the back because he wasn’t sure if the financing would go through. Sure enough, it didn’t. The young couple came back a couple of days later to retrieve their old car. It was a simple as that.

You know the situation is bad when the arbitrator you hand picked hammers you that hard for what you did. Every time I've ever financed a car, the salesman has never failed to say, "congratulations, you're approved". And that's usually before we even finalize the deal. From now on, I'm going to make sure to get that in writing.

I was in the auto industry for 45 years. I bought, sold, repaired, and even taught school. You always arrange financing BEFORE you start looking. That way you know your financial limits and avoid buying something too expensive. Thankfully in the state I was raised in that kind of financial trickery is not permitted.

20 year dealer here. Definitely abusing several good faith practices. 1. Trade should be paid off in 10 days from dealer. 2. if trade was sold, better find a way to keep them in car they bought. 3. None of this should take 3 weeks. Dealers like that don't usually last long with social media. Just like everything , there are good dealers and some that shouldn't show there face in public. I love some of your topics, especially the auto related ones.

Way back when I was young (late '70s, early 80s) I had this happen to me a couple of times. I bought my first car at age 19, had been working for one year, and my mother had cosigned the loan. My father passed away when I was 16, my mother inherited his car, which was basically junk, and I drove that until I decided to buy a better car. The paperwork went through, and I drove away with the car. A few days later, the dealership called and said they needed to talk to me, something about being able to "save me some money" I went down to the dealership to find out what was going on. Basically they told me that the loan did not go through, and that it would need to be refinanced for a shorter time, with higher payments. I told them I could not afford the higher payments, to basically F themselves, take the car back, and give me my old car back. But apparently they did not want the car back. Eventually everything got worked out, with the original loan terms. That was my first experience with a dealer, and it was a bad one. My guess is that most people's first (and probably all) experiences with dealers are bad. About 4 years later, the same thing happened AGAIN. I had paid off the first car, and decided to trade it in on another car. Everything went through, and I drove away in a beautiful 1975 Camaro. A couple days later, the dealer called, and again told me there was a problem with the loan. I was PISSED. I went back to the dealership with a couple of friends, threw the keys to the Camaro down on their desk, and demanded my other car back. We sat around for what seemed like forever, and finally the manager came out, apologized profusely, and told me everything was ok. I never heard from them again, paid off the car, and kept it for over 10 years. In my mid 30s I decided to buy a new car. But that time I did things differently. I went to the credit union (I'd had a government job since age 18 and had good credit) and not only secured financing from them, but even got assistance in buying the car. Basically they made the deal, all I had to do was go to the dealer, sign the title/registration paperwork, and pick up the car. I learned another lesson there. Never buy a new car. It took 5 years of high payments and insurance to pay off that car, and I went without almost everything else to do it. I kept it for 12 years, and since then I have only bought used cars from private sellers for cash. New cars are probably the worst investment you can possibly make, and if you are going to buy a used car, buying it from a dealer is the worst mistake you can make. Oh, and to me, good credit is anything over 800. My credit score is currently 837. And that is living on retirement, just a hair under $50,000 net income a year, with NO outstanding loans. No car loans, house is paid for, I do use credit cards but pay them off in full each month. I'm nearing 64, and have never been late with a payment on anything in my life.

I had a Kia dealership try to do this to me about 20 years ago in Prescott Valley, AZ. My husband basically “explained” to them that we weren’t bringing the car back and that we would get an attorney involved if necessary. We didn’t hear any more about it after that. (Of course the car turned out to be a piece of crap, but I have a Mazda now. zoom zoom) 😊

Be careful...Here's a "tactic" that was pulled on me and my mother when I was young and needed a co-signer...long story short, it turned out that my credit was so bad(yay divorce's!) that even her co-signing would not get me financing, but their scam was to somehow re-submit everything without my name on the paperwork. When we went to the credit union to see about having it all put into my name to relieve my mom of her financial responsibility we found out they had never heard of me, it was all in her name!

We've never had this happen to us, but it's scary that these dealerships exist. Shouldn't the customer be allowed to obtain their own financing in a situation like this? I mean, maybe their own bank, or a relative could help in this case. This sounds so much like a scam, I can't believe this is accidental. Thanks for the heads up, so we can warn our kids about these tactics.

Excellent video. I had no idea scummy car deals like this were rampant. We’re about to buy two cars. THANK YOU! You have my sincere gratitude.

This is exactly what happened to me and my wife shortly before we got married trying to buy a Pontiac G6 for her. We ended up driving it for just shy of 4 weeks before they came back and said Hey we don't have financing for you. What's hilarious is we went to another dealer and got a better deal on a brand new car Literally days after this so I have no clue how they couldn't find financing for us one another place was able to do it within hours

“Even though they sold your trade in”… Simple! Since the deal isn’t “final”, call the folks you “sold” my trade in to and tell THEM the sale isn’t final. Bring my damn old car back!

I started watching your channel on a business trip and continued since. I really liked my Business Law class during my MBA program and this show is exactly why, fun discussions about real-world cases around tort/UFC can be very interesting when done right, which is what you do, Steve. Thank you.

This is why I went through my credit union. I found the car I wanted, negotiated the financing with the credit union, and they sent me a check. I walked into the dealership, handed them the check, and walked out with the keys. (skipping over the mountain of paperwork for brevity)

This happened to a coworker of mine about 20 years ago. Traded in his small truck on a newer full size. Dealer let him leave with the new truck then 2 days later claimed financing fell through. He decided he wanted his old truck back but they claimed it was already sent to auction and there was nothing they could do (2 days had passed).Took weeks to resolve. I eventually saw him driving his old truck again so I assume there was something they could do.

I think it should be a law that all contracts must have full recipricocity. If the dealership has one or more terms under which they can take the car back, the customer needs an equal number of ways to cancel the sale and get their money back. Plus penalties on either side: You want your money back, they get the car and charge a penalty. They want the car back, they have to refund plus a penalty. It should not be legal to allow contracts that force people to, say, agree to future TOS updates or lose access to past functionality, or to make people give up their right to their day in court via forced arbitration. These things are predatory, and work to allow companies and large entities to protect themselves against those who already have little recourse.

years ago, i went to the local dodge dealer here in torrance, the car was a ford fushion. We agreed to a price and went to the office to close the deal. I told them i was not going to finance and pay with a check, And they can hold the car until the check cleared their bank. Both myself and the dealer used the same bank. Two days after the deal was made, i got a call that the check was bad. I knew this was wrong, i called my banker and got into a conference call with the dealer and my banker. I asked the banker has my check been presented to the bank. When he said no, no check for that amount had been presented and it would have easily cleared. Then dealer hung up. Turns out that the car I was buying, was a car that they needed to sell and finance to make any profit. Basically they are very dishonest

This happened to me with my first car in Canada over 10 years ago. Tldr- I bought back my dad's exact car he sold when I was born so he could afford a trailer for me and my mother. He was 19. He sold his 1972 delta 88 Oldsmobile with a 455bigblock V8. I found this exact car restored same numbers Everything at a classic reseller. Over a month went by I bought the damn car OUTRIGHT. Transferred the cash that day. Didn't matter, they still tried taking it back claiming my credit failed. There was no credit involved, they had every penny. In the end I moved took the car across the country and said file a report, I'd LOVE to be paid in court. They tried, they failed I won 1200$ ontop of keeping the car. They tried saying my credit failed, they tried saying they didn't actually have the title. They tried saying a lot of shit. Turns out, they bought the car from someone who never paid off the restoring costs to the shop that did the work. The shop had a lean or what ever you call it. The shop owned the car pretty much and the dealership was in hot water for selling a stolen car. Not. My. Problem.

Time to name and shame dealers who do this...

I absolutely refuse to allow any dealership to finance my vehicle. I've always gone to my bank, told them what vehicle I'm wanting to buy and to cut the check. Then and only then do I go to the dealership and start talking numbers. Once I get them down to the price I want and they pass me off to the finance people, that's when I pull out my checkbook. I cannot tell you how many times I've pissed them off doing this because they'll give me a really good price, knowing they're going to screw me on the finance & fees. Last time I did this, they tried to say it "doesn't work like that and you can't do it." I shrugged, said have a good day and went to the next dealer.

This is a fine example of “Legal” being “Un-Lawful”. Buying something in good faith only for it to be stolen back and the government to protect the companies instead of the people is a terrible practice.

I worked at a small used car dealer in Eastern Washington state from 1994-1996 as a “lot boy” - but I was “good with computers”, so I was tapped to pull credit checks, set up paperwork, install software, etc. - I saw exactly ONE deal pulled back because of this issue in that time - and it was because a salesman (when the owner was gone) ignored the credit report and filled everything out anyway. The owner was pretty upset come Monday…..when I threw the sale guy under that particular bus, which he very much deserved to be under.

A similar thing happened to my sister a decade ago. My sister refused to go back in and the car dealer repossessed the vehicle. She sued them, the case went to jury trial, and she won.

Oh the stories I could tell... I've been made to sign people up knowing they couldn't borrow $5 with a $10 deposit for the sole reason that the desk managers needed one more deal to hit a cash bonus on a particular Saturday. I finally got out of the car business the day after the guy in the office beside me was on Dateline.

The first car I purchased in conjunction with my wife two decades ago, it was the weekend and I told the dealer on the phone that we were interested and would be there on Monday. They said we should come in now. I said I can’t right now. So they said it might sell by then. I clearly remember my reply to that being, “Sucks to me, then, doesn’t it.” It was still there on Monday. We purchased it because my wife wanted it. I did not like the seller’s pushiness.

THANK YOU! I plan on buying a used vehicle in the next few months and you really TAUGHT me so much in your video! I watch them all the time! Keep up the GREAT WORK PLEASE!

I had a buddy who had a 1982 Firebird (back in 1984). He went to look at a Monte Carlo SS and the salesman had him take the car home overnight. My buddy decided he preferred his Firebird and went to the dealer to return the car. As he was pulling onto the lot he saw his Firebird being loaded onto a car carrier. He demanded they take his car off the carrier and he left that dealer never to return. Had he gotten there a few minutes later his car would have been gone.

We just bought a used pickup this past fall. Got financing from our credit union. From the time the loan was approved, we had 30 days to find a vehicle, but we had started to look before we even applied for the loan, so that wasn’t a problem. It 🎉was so easy and trouble free, I feel bad for anyone financing through the dealer. I’m glad these folks got such a good result in the end.

I had this happen to me a few years ago in Oklahoma. They called me a month after the fact (I had already spent about 1000 on the car in tires/ oil change/transmission flush). They tried to jack up the terms(I have great credit) so I showed back up with cash to pay the car in full. Suddenly they didn’t want me to pay in full as they wanted to make the money on the interest. It took them 5 hours to decide to let me pay cash

I worked for a used car dealer back in 2013. They did this crap all the time. They even claimed to of sold the trade in, but they in fact hid it at their home a few blocks away. They were not the owner of the dealer but the manager and her husband who was the mechanic. I started there with a different manager who was decent, but they left to join a church in another state. I sold cars and did the detailing. The machinic would take over my sales and take my commission. Why did I stay you ask? Well the owner was my brother and I was keeping detail notes on all they did. They didn't get busted sadly as one night long after we closed, they came in and took everything (left most of the cars) and disappered. The dealership close after that. The plan was to get them busted for everything they did but they left the state and the local PD wouldn't do anything, said it was a civil issue. Apparently, stealing cars, computers and money was a civil issue... It about ruined my brother and it caught up with him in December when he died of cancer.

This happened to me when I bought my very first car in the 90's. All of a sudden 4 or 5 days later I get a call that the 7 or 8% interest that I had signed for jumped to like 45% interest. I looked at them like they were nuts and said I will return the car and you give me my trade. When I went in to return all of a sudden they offered 20% interest as "good news" and I told them we had a deal and either I walk out with the original deal or my old car. So I drove off with my old car and went to a dealer 15 minutes away. I got the exact same car for 250 bucks less at the same low interest the first dealer originally offered.

I worked at a dealership for a few months and learned some nasty, nasty things. We called them "unwinds" and would call the owner and ask them to come back to have something fixed. The way it was explained to me is they would submit many contracts to a bank and just "hope" some would stick. Should be illegal.

My wife and I had a dealership try this on a 1 y/o used car. We brought the car back to them and dropped it off. Argued with the finance guy and the general manager for 20 min and walked out. We went to a larger dealership 45 min away and drove off in a brand new version of the same car with the same options, and they honored the original terms. They, of course, didn't tell me bringing the car back was an option, I just happened to know that.

I had something similar happen a long time ago in GA. The dealer called a month later and said something similar. I told them I wanted my trade in back and they said they sold it. I went to the dealer and saw the sales slip on my trade in called my bank and they said it was paid off. I said thanks a lot, threw them the keys to the car and walked back to the base. I was VERY upside down on my trade because I was stupid and became debt free in an instant. After a few calls, I went to the base JAG office with everything and the wing commander blacklisted the dealer, I was not the only one who had that issue. I got a lawyer to cover myself and the dealer backed down because my lawyer planned to bankrupt them since they were blacklisted by the military and lost about 80% of their business. It sucked that I was out $800 for the lawyer but I helped to crush a shady dealer and got my trade in paid off.

Something like this almost happened to my girlfriend once. She wanted to buy a used prius and a dealership in the region which had what she wanted. Initially we wanted to self finance, but for some reason the dealership said they had to do it which should have been the first red flag. A week later she got the call that there was a problem with the terms and they tried to push her into signing a contract changing everything. Afterwards we immediately went to our credit union, applied for a new car loan, and refinanced the old loan into the new one closing it out. They can't call back about financing problems if they have been fully paid off. Weirdly, the bank they chose STILL sends us letters years later. It's stupid and annoying. For my own experience, I was once in the market for a new car as well. I had done my research into the kind of car I wanted and what price I could afford. I went to a dealership telling them what I want and that I wanted to do a test drive. They said that I had to apply for a loan through them even though I told them that I have my own bank who I'd finance through. Reluctantly I went through the motions, was approved, and then I said, "OK, I want to test drive the car now" and then they explained that the dealership is split in two and that the loan application I filed was for this other half of the dealership and that if I wanted to test drive the car I'd have to do another loan application. Keeping in mind that this was mere MOMENTS after finishing one already and that they already knew exactly what I wanted. Since repeated loan applications damage credit I told them that I won't be doing that and left. Of course I understood that they knew multiple credit checks were bad. More likely than not, if I did the second check, it would have been declined or they'd at least say that it was. They'd then have used that to try and push me into a more expensive new car that I didn't want. Suffice to say their little scam didn't work. Of course, because they pulled my credit I had to wait a year for the credit pull to drop off my report and by then I had less of a need for one. That was my first and only experience trying to buy a car for myself at a dealership. The transaction should be simple: They should just list a price and expect the customer to pay that price. Customers should do their own financing. Unfortunately they use the financing front as a tool to scam customers in multiple ways. The dealership experience is why I would rather walk then buy a car if buying a car means having to deal with those people. In my opinion the dealership shouldn't even exist anymore. The car makers should be selling direct to consumer. Cut out the middle man who knows nothing better than how to scam people. Of course, for that to happen, laws would have to change that prohibit car makers from selling to anyone other than a dealership. If I ever need to buy a car I'd sooner import one from China than go to a car dealership.

The one time a dealership tried all that on me, I just asked them to call me a taxi, and that my attorney would contact them in the morning. I drove off in a very nice Camero for the original cars price. About a 7k difference.

My mom has had this happen to her. I knew it was too good to be true with how nice the car was.

I’ve had this happen to me, all three times that I bought vehicles in Minnesota: Carmax, Toyota, and Ford. I received several calls, starting about a week later, all stating that my financed terms were incorrect and that my interest rate was too low, so I needed to return to refinance. Same call, three different dealerships, over a span of six or so years. Each time, I ignored them and made the payment that my paperwork stated from the initial financing. After they cashed the first check, it seems, they stopped calling.

Good result. The fact the financing fell through 3 weeks late and not only screwed them out of any auto since their trade in was sold prior to repossession but left them with the loan for the now repossessed auto is BS. If the dealership was so upset, a ding to credit rating is enough, but depriving a person of auto transit in a place as auto centric as America due to something the purchaser didnt actual directly do is absurd. Hell, that loan should've been discharged immediately upon repossession.

This happened to me when I was twenty-two years old and it upset me and my family. I can't remember exactly what the reason was that I had to find another cosigner with better credit... So at first my father had co-signed for me I'm two weeks later I got the yo-yo call and had to go back in there with my brother which had perfect credit.. they tried to get more of a down payment added me I told him I wasn't going for that I think they just wanted to screw me out of the thousand dollars that I had already put down.. it was a used car at a Toyota dealership here in fort Pierce Florida.. years later I had received word that the sales manager ended up going to jail over some shady crap that he was doing at that dealership screwing people over. I heard that from a friend of mine who got a brand new car at the same dealership.. we're going to high school together..... But anyways he got a call after 2 weeks of owning a vehicle I can't remember exactly what his deal was I'm sure it was for more money

This happened to me over 30 years ago. We went to the dealership, bought a new car (actually it was sold to us, if you can understand that nuance), discussed the financing, signed everything, then drove it home. I'm making up these numbers since I don't recall exactly, but let's use sale price $12,000, cash down payment, $2,000, $10k financed at 8% over 5 years at $150/mo. That was on Saturday. On Tuesday of the next week, "the" call. No financing available at those terms. I protested loudly enough that they dropped the demand for more money, adjusted the sales price to $10k, raised the interest rate to 15%, and left the monthly payment at the same amount. I do not know if they lost money on us or not, but we got the car with the same cash outlay.

I did auto loans for 5 years at a medium sized credit union....and I can tell you this happens all the time. Even with the big, franchised dealerships. That same scenario plays out over and over again. Most of it comes down to GREED on the dealership's part and many of them know exactly what they are doing. I've seen very very few do "the right thing" and eat the difference in cost. On the flip side, it's usually the consumers with horrible credit that feel they are entitled to drive $50k+ vehicles when none of their income and credit supports this. Combine the greed of the dealership, commissioned salesmen, and terrible credit across the board, this is why its so common, imho.

It would be more understandable for the dealer if they held the trade-in until the deal is final. I agree with Steve: the dealer that sold the trade-in should have to make it up to the buyers. I’m glad there was a happy ending for the family in Orlando.

in my area we refer to deals where the financing isn't approved prior to delivery as "spot deliveries". Whenever we do a spot delivery we ALWAYS see the customer's credit beforehand. Yes, the majority of the time everything works out fine but if for whatever reason the dealership can't get the loan approved they know within a day or so, NOT THREE WEEKS. There are A LOT of dealerships out there that operate like the one in this NPR story and State Attorney Generals need to go after them. I was a finance manager at several dealerships for over 20 yrs and whenever I am asked for advice about the finance side of buying a car I always recommend that buyers get their own financing arranged ahead of time. If the dealership can get you better terms then great, go for it but if they can't get you a better deal you proceed with your own financing.

I operated a small used car dealership from 2015 until last year in Shawnee, Oklahoma. We always recommended to our customers to check with their bank of credit union for financing to save money. For credit challenged customers, we'd do a retail installment contract and attempt to assign in (frees up money so we can buy more inventory). Anytime that we could not find someone to buy the note, they had to stay on our books and make the payments to us since we signed the agreement with them. I think it is wild that what happened in this situation is even possible, let alone a common practice.

Thank you for this. I am in the process of getting a car and in my state yo-yo sales are legal. BUT NOW I know that if I finance from the dealer to get them to write on the contract that I am guaranteed for approval. Also in my state it is illegal to not return the trade in and deposit if the finance falls through.

Leaves me continually greatful for the fact I've always been a member of a nice credit union thanks to my parents employment while I was growing up. Got pre-approved so they basically gave me a check that was good up to so much money that I would hand to the dealer I was basically paying cash and didn't have to mess with them trying to sell me financing

Happened to me once on a lease, completed on a Sunday. They called on Tuesday and claimed my trade-in had been sold. (It hadn't.) I refused to negotiate and they miraculously found my trade-in later that day. 😆

Every dealer I worked for was a new car dealer. They all had access to lenders on the computer. Some were only set up with a couple banks and some were setup with several. Some of these banks require different reporting agencies for interest rates. I have never seen those deals “unwind” as they say. Most of the time you can have the interest lowered if you have some “skin in the game” a down payment. Gmac, now ally has special rates just to sale new cars, those rules are set by the manufacturer. Best practice is to have a down payment and no trade in, unless it’s paid for. Most of the time your trade isn’t worth what you owe so they have to act like you are given more for the trade to pay it off and that money comes from your discounts, rebates or dealer profit.

A dealership in Beaverton, OR did similar to this to me. My mistakes were shopping alone, on a Friday night, walked onto the lot wearing a knee brace, no trade in, and no prior planning.

It's unfortunate that cars have gotten so expensive that the average person can't save up enough money to simply pay cash for it...that pretty much negates any ability of the dealership to employ a sneaky tactic like this. My wife and I are fortunate to be able to do this (good thing we prefer economy cars, lol) and it does make the car buying process a whole lot less stressful

Excellent video as always I just wish the punitive damages would have been much larger. With this tactic Being so prevalent as you stated, the amount awarded should have been at least one Million. This would definitely set an example to any and all other unscrupulous dealers.

There was a car dealership in Philadelphia named Gary Barbera Jeep dodge and Chrysler. They were spotting cars and then without contacting the customer the dealership was repossessing the car on their own. The repo company was zip tie the screen doors so they couldn’t be stopped. The dealership was in huge trouble. This happened years ago and was all over the news.

I had a dealer call me back 3 months later after buying a new car from a ford dealer, they came asking me for more money because ford credit said they needed more... I said I'd call them directly because I need a bill showing that (I had a very high credit score during this transaction) Credit company said they didn't see anything like that, I called Ford directly and asked them as well. I called the dealer and said they needed to put me in touch with someone who could explain it to me why all of a sudden I'm supposed to write the dealer a check instead of the financer and why no one else can explain where this cost came from and why no one can explain whether this will show up on my finance payments or whatever. I think they just gave up at that point. I told them I don't have a problem paying if they could make me understand why I was paying it but right now it just sounds like some random person calling me and asking for money... They aren't family, they aren't my friends so I don't do that.

I got screwed over with Wells Fargo like this, I made them put in my finance deal that I CAN take the car out of the country. A few weeks later they said they never received my title via certified mail (Flat out lie) I resubmitted but they wanted the car back. They said the only way I could not have it repossessed was to go to a branch and re sign the paper work before close of the business day. They thought they had me because the closest one to were I got the car on the east coast was hundreds of miles away. But they didn’t know I was on leave at my dad place on the other side of the country who happens to live 400 meters from one of their branches and since I was on the west coast, it was relatively early. Next they screwed me over when they placed a block on the car to leave the country (when I was getting stationed overseas). I got close to half my deposit back from them directly and still kept my car since I refinanced with my bank. This was right before WF got their comeuppance.

California has a same law. I just bought a Vehicle week ago. Went to see a buddy who works in the Finance Department and he took care of it all for me

I had a finance manager who worked for me. His primary motivation: deliver the car....on Saturday, if possible. 1st time we had to redo the deal due to lack of financing: tough break. 2nd time: huh? ( a week later than 1st deal! Hmm...) 3rd time: looked the deal closely....customer's credit profile? Weak....trade payoff? Not yet verified....Down paynent? customer used several credit cards....didn't have any hard cash....dead deal. Finance manager: add "Former" to his job title.... Rewound deals.....all three....fixed them...customers are hard to win, easy to lose.....reason #4 of 100s why I left the biz 15+ years ago. Thanks, Steve.

Great Stuff! There were several "red flags" in the story that let you know that the dealer was crooked. Dumping the trade and not paying it off was a big one. The main thing to learn from this is to arrange your financing before you go shopping.

Had a dealer try this on me. Once. Insurance called me at work after 3 weeks, asking who was holding the title so they could insert the lein holder. I stopped by the dealer on my way home after work to get the info. Dealership had no-one stating they were STILL trying to find someone to buy the paper. State law says they cannot sell my trade (still parked out back) until the dealer has finalized the signed contract. I tossed them the keys, took out my spare set for the trade, walked out back and took my trade back. They got their brand new car back with 250 miles on it and a scratch down the side already... to probably sell as a used unit. Never heard from them again.

1 - Equifax/Transunion etc are open 24/7. There is no excuse for not knowing a customer's credit rating. 2 - This is one of the many reasons I walk in with my own pre-approved loan. I may take the dealers terms if they can beat it (and they often can) but I have my loan. The only reason I would take their loan is if they can beat the interest rate.

I had the cash for a car and I found the perfect one. It was high pressure sales tactics and it was on a Friday. They wanted at least a 20% down payment on Friday, but said I couldnt get the car till Monday. I told them "no way.....if I pay now, I want it now, if I cant get it until Monday, then I will just come back then and pay it off in full" They called me on Monday telling me that the car wasnt safe, come to find out, and they couldnt sell it to me. But he had another vehicle that he was sure that I would love. I wanted a car. He recommended some huge SUV with 3x the miles on for double the price. I hung up on him. I should bill them for wasting my time.

As a law enforcement officer, I can tell you I have never encountered an honest used car dealer that carries the note. The list of scams they run is pretty astounding.

I had something like this happen many years ago. I returned the car to the dealer and got my old car back. It was 2 weeks after I had "bought" the car and they still had my old one. Luckily I didn't put any cash down on it.

Put them on blast in every social media you can find. You will be surprised how quickly their lawyers will be calling you up to "make things right" Or at least that is what I did when this happened to me.

I had a dealer once tell me they refused to work with my bank because "state law" says the dealer is required to set up financing. I asked for that in writing from them and all I got was a bunch of stammering. I walked out and filed a complaint with the state's attorney's office. I * really* wanted their policy in writing, though.

This is why I hate borrowing money. Being debt-free feels soooooo good.

I use to Repo cars for these shady dealers for a company that would buy the bad paper, when people would not return the car, or stopped making payments. I was young and I’m very embarrassed about it now.

Interesting. I’m from the UK and every car I’ve ever purchased has been conditional on financing, you don’t get the car until you have been approved for credit, and even then you still have the option of backing out. I now live in Canada and it’s a very similar thing, I’ve never had an issue like that - the fact that is legal seems shady as heck to me.

This happened to me in Florida back in 1993. It was a 1993 Toyota Tercel. We had it over the weekend I called us talkin about we needed to give them another thousand dollars for the down payment. And we went out of town with and put a lot of miles on it. So we went to the dealership. Monday and they decided to walk it back. We ended up not paying nothing extra. Because we weren't going to pay more. They said to us that they just lowered the cost of the car a $1000. To make it right

This is super interesting. Some years back I moved to the US, and as I'd only been there a month or two when I went car shopping I found a car I liked, on a Saturday. I tried to get it, and unfortunately they couldn't arrange a financing agreement on the weekend for me. They took the details, etc. They did call back Monday, and I got approved for a deal, however the car had been sold in th emeantime. The dealership were up front with me, and friendly and honest. They told me they couldn't hold the car, as they didn't know how likely it was I would get the deal. However, the story in this video is a demonstration of the issues the deslership had; they can't the full checks on the weekend. Still though, from my perspective, that seems insane. Many years before my car purchainsg stories I used to sell TVs in the UK, where we did financing. I could run those through (for thousands of pounds sometimes, certainly more money than cheap cars), and we'd get the final approval immediately, and initally it was all done over the phone.

Just one more reason NOT to finance you car at the stealership.

Had this happen buying a home. Lived in the home for 3 months and lost $12,000 and was forced to move. Tried to fight it. But the attorney wanted $25,000 to handle it... Me my daughter lived in my car for almost a month before I found and could afford a new apartment. Shelters are not available for men that gave children let alone a daughter... I will never buy a home. Daughter is grown now. Found a shuttle bus for $4500 cash. Will be converting it and hitting the road this fall. Screw the economy and those who exploit people.

All the cars I've bought have been in Washington State and they have had a strict law on the books for years prohibiting it. The dealerships have the ability to start loans all day and the weekend.

This happened to me and a girlfriend many years ago. It was a dealership that advertised "guaranteed financing" or you'd get the car free or something like that. When they yo-yo called us they said the only lender they could get to approve us wanted an extra 4 grand down. That's how these fuckers get out of their "guarantee": "Oh we got you financed, but if you don't want to pay this ridiculous fee to get approved that's on you" Scumbags.

While I have an issue with the notion the deal is not final at signing as one could argue the dealership is acting in a capacity as agent for the lending companies they use (it was always my impression when I have bought cars that the finance guy gets some sort of verbal or electronic approval when the deal is sought), my real burning issue is how is the dealer not on the hook for the original agreed upon trade-in price they paid for the car? I can understand in such a scenario (the yo-yo tactic) where the dealership can "repossess" the car should the potential buyers say no to the revised deal as the potential buyers don't really yet own the new car, but no one can claim the potential buyers were in default of a security agreement that was never executed by the lender. Thus, this cannot be a true repossession in the sense of a lendee being in default of a security agreement. Hence, it would seem that the dealership was metaphorically pushing a "reset button." In that case, it would stand to reason that the dealer owed the perspective buyers either their trade-in back, or a check for the agreed upon amount for the trade-in. The further fact that the dealership sold the car without compensating the perspective buyers nor going through with the agreement to payoff the potential buyer's loan on the trade-in is astounding. It seems to scream lawsuit, or possibly even criminal charges.

I arranged my own financing at a great rate and approved for way more than I needed for the car I wanted. Went to dealer with my step son, a car salesman, found the car i wanted and my step son made sure they didn't pull any of the typical tricks. End result, great car at a great price and great financing I paid off early.

I work at a motorsports dealership. A customer was approved to buy a jet ski so he took it home and used it. The bank came back and declined the loan because the customer failed to send in proof of income. We thought it was a done deal with the bank and it was, according to our paperwork. We ended up having to repo the jet ski.

Sometimes “Business Ethics” seems like an oxymoron …