2015-04-01 / Political Page

Crime Chat With DA Brown: Car Dealer Finance Fraud

By Queens District Attorney Richard A. Brown

If you have ever purchased a vehicle, you know that the experience can be exciting as well as stressful. Unfortunately, as in all lines of work, there are unscrupulous used car dealers. One scam that we have seen on the increase involves a dealer finance representative tricking an unwary prospective vehicle purchaser into taking out a loan that includes hidden fees on the vehicle that can cost the purchaser thousands of dollars more than he or she intended to pay or can ill-afford. Often, the result is ruined credit for the purchaser and the repossession of the vehicle by the dealer.

How do you avoid this from occurring? Here are my three tips to keep you from getting scammed when financing your used car purchase through a dealership:

• Trust your intuition and walk away from the deal if you feel you are being scammed. Most victims of these schemes that we have interviewed have admitted that, at some point, they thought something was not right, but they were too timid or excited by the deal to walk away. Unscrupulous auto dealers use various questionable or “shady” practices to trick the customer into thinking he or she can’t walk away. One practice is to keep the customer waiting in the dealership for hours with all sorts of delay excuses. The purpose of these delays is to wear down the customer. A customer who has invested hours into a “deal” will eventually reach an exhaustion point and agree to whatever terms the dealer wants.

• Never sign or initial next to a blank line in the dealership paperwork. Signing or initialing beside a blank space in the paperwork is akin to signing a blank check and is an invitation for the unscrupulous dealer to later fill in the blanks with terms favorable to the dealer! Often this means thousands of dollars added to your car loan in extras and hidden fees. Later, when you go back to the dealer and complain that you were duped into signing the contract, the dealer produces the paperwork listing all the fees and extras with your signature or initials “approving” each specific item – the very same initials you voluntarily wrote when the items were blank.

• Never leave the dealership without all the paperwork, especially the retail installment loan contract. The loan contract is what makes you responsible for the payments. It is the thing that puts you “on the hook with the bank.” Be wary of excuses such as “the printer is broken today” or “I am not allowed by law to give you this paperwork,” or “the bank will mail you a copy of all this for your records.”  These excuses are glaring signs that the dealer is attempting a scam and means that you will be paying a lot more than you think you are for that sought-after car. In conclusion, financing a used car should not lead to ruined credit and your car being repossessed. Stay alert, ask questions and if you feel that something is wrong, it probably is, so walk away from a questionable deal before signing anything. Finally, if you feel you have fallen victim to a scam, call my office for assistance.

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