Basically a dealer will charge you $300-$900 for window etching and they will tell you that you have to pay the money to get the loan because the banks insists on it.

Some dealers might tell you that the etching is free but will add on the etch money to your monthly payments to make up for it.

The best way to avoid this scam is to force the dealer to put it in writing if they say that the etching is free or simply etch the car yourself.

You can get an etch-it-yourself kit from http://www.CarEtch.com for $30 or just don’t buy the car.

Remember a lender doesn’t require that you purchase any extras on a car. All the lender cares about is that you can make your payments on time regularly. Don’t buy into it.

2. The Financing Scam

I have mentioned this before already, but here it is in more detail.

Basically you trade in your old car and the finance manager tells you that your interest rate is good and then gives you the car.

After a week or two passes you get the call from him that you didn’t qualify for the interest rates that they gave you upon making the deal.

Every new purchase has a clause in the contract that usually states that the deal is “subject to loan approval.”

This gives the finance manager a loop hole in getting more money out of you.

All that this means in the contract is that the deal is not finished yet even you already have possession of the car and have signed the contract.

The dealer can then charge you $1000 more in finance fees and up your monthly payments by $50.

This scam is generally pulled on people with bad credit because it is more plausible.

If you are wondering why they would sell you the car at 6% APR if they knew you had bad credit (remember they ran the credit search already) the answer is simple; to sell the car.

You can avoid this scam by not financing the car with the dealer if you know that you have bad credit.

You are better off going to a credit union and financing the car yourself. When you buy a new car the deal should be made on the price of the car, not on the monthly payments.

3. The Credit Score Scam

This scam is ridiculous at best. This is when the finance manager tells you that your credit score is lower than it really is so that they can get you for higher interest rates.

This scam is pulled on everyone; good or bad credit.

This scam is easy to avoid. Just get your own copy of your credit report from Equifax.com, and bring it with you.

It is really difficult to lie to you about your credit score if you have your own copy of it. If your paper and theirs doesn’t say the same thing, go somewhere else because that dealership is lying to you.

Don’t forget to let them know it too because it’ll be nice to watch them squirm.

4. The Forced Warranty Scam

This is when the finance manager tells you that you are not eligible for the loan by the bank unless you pay an extra $2000 for a 2-3 year extended warranty.

This scam just doesn’t make sense. Basically the finance manager is telling you that the bank won’t trust you to pay the $20,000 loan for the car, but they will trust you if you pay even more money. That’s just stupid.

You can avoid this scam if you can force them to put it in writing that you “have” to pay the extended warranty in order to get the loan.

That way you can bring a copy of the contract to your local State’s Attorney’s office to verify that the deal is valid. I can bet that the finance manager will change his tune pretty quickly.

5. The Dealer Prep Scam

Let me first let you know that cost is not only legal but very much common practice. I still refer to it as a scam because it is just another way for you to end up paying more money for the car.

Basically the dealer will tell you have to an extra $500 to cover the labor costs of the dealership’s 5-point inspection.

You are paying for the time it took for the dealership to make sure that the car wouldn’t explode on you in the first week of owning it.

This check up that you are paying so much money for is for the dealership to remove plastic from the seats etc, vacuum the car out, and making sure that all of the fuses and fluids are ready to go.

When factories deliver the new cars to the dealerships the cost of delivery and prep is already covered, so basically you are paying the dealership for work that they haven’t really done.

I swear they could get the car in perfectly ready to drive condition and put everything right back in it just so that they can make you pay the fee again.

You can avoid this scam by simply asking the dealership to add an extra $500 credit to the deal to make sure you do not have to pay the money.

If they refuse, you can then decide if the car is worth the money. If it is fine; buy the car, if not; go to another dealer that will remove the dealer prep costs.

6. The Dealer Mark up Scam

This is an unnecessary fee that the dealer charges for no reason other than greed. This fee can be seen on the orange sticker marked on the manufacturer’s suggested retail price (MSRP).

The additional dealer markup is nothing more than requiring more money for no real reason. They can include all kinds of extra fees in the additional dealer markup.

When you see an extra dealer mark up fee, ask the dealer to get rid of it. If they refuse, it is pretty much up to you, but remember that if you do pay the extra dealer markup, you are overpaying for no real reason.

7. The Payoff Your Loan Scam

 This is when the dealer offers to pay off the balance of your current car loan no matter how much money you still owe. It is a common sales strategy.

When the average buyer hears it, they think that by purchasing a new car with a new dealership, they will automatically owe no more money on their current car.

That couldn’t be further from the truth.

What really happens is that the dealership does help you get out of your current contract; however, they normally are forgetting to tell you how high your fees are going to be for breaking the lease agreement with your old dealership.

You will now be responsible to pay fees that are in the thousands to make up for it.

You also will not be able to refinance for a new car until those fees are paid. Of course the dealership can add the cost on to your contract with them at a substantially higher rate.

The dealership only agrees to this deal because they want to get more money off of your current car. They aren’t really doing anything for you at all.

The dealership will also give you far less then the car is worth on the trade off. Basically this scam works because they will up your monthly fees, and then sell your trade in for a more money than its worth.

The dealership then extends your monthly payments so that they can make it appear that you are paying a small amount monthly when you don’t even realize that you have committed to an extra year of payments.

To avoid this scam, you have to bite the bullet and ride out your current lease till the end. If you are really determined to get a new car, then you should try selling your current car on your own.

Just sell it so that the buyer just takes over the lease payments.

8. The Used Car Sold “As Is” Scam

This is when a dealership will sell you a car that has been in a car wreck, but they will tell you that the car has been completely refurbished.

When you see the car it has a sticker on it that says “as is” on it and no warranty is included with your purchase.

This is the dealer’s way of telling you that you can’t bring the car back, you are assuming all risks for the car, and that it is not under warranty.

To avoid this scam, don’t buy a car without a warranty or one that says “as is” on it. By doing this, you might as well buy a car from a stranger on the street with the same deal.

9. The Bounced Check Scam

This is when you walk into a dealership with a bank draft and the dealership charges that they can’t accept your draft because your bank bounces checks often so they now refuse checks from that bank.

Of course, this leaves the table open for them to get the extra money they want by offering to sell you a car at a higher interest rate.

You can avoid this scam first by getting your drafts from Capital One Auto Finance.

Then let the finance manager know that you are aware of the scam that they are pulling and that Capital One Auto Finance is in the business of giving loans so the checks don’t bounce.

10. The Forced Credit Application

If you are hoping to pay for a car outright or in cash with a bank draft or check that is what you should do. Some dealerships will not let you.

You will hear one of these lines so that they can try and get you into paying monthly terms for more money.

“State laws require that you must fill out a credit application before I can sell you this car.”

“Everyone that buys a car from us fills out a credit application first.”

“It’s the company’s policy”.

If you hear any of these lies, then know what’s going on. When you are paying cash why would you think that you need to fill out a credit application?

It doesn’t make sense. No state will force you to apply for credit when paying cash.

Would you have to fill out a credit report if you want to buy a sofa or groceries while paying cash? See how silly this is. To avoid this scam, just laugh in their faces.