If you’ve been to Los Angeles, you’ve surely noticed there is no shortage of cars on the roads. Unlike other large metropolitans like New York City and Chicago, there isn’t a robust train and public transportation system.
To give you an idea, there are nearly 6.3 million vehicles registered in Los Angeles County.
This means dealerships are constantly bustling and selling vehicles. Like any other business, dealerships are looking to buy vehicles cheaply and sell them for the maximum amount. But the path to doing this sometimes crosses the line into unethical territory – with deceptive practices to sell problematic vehicles.
As an auto fraud attorney in California, I want to share 20 of the most common tricks we see dealerships use. If you’re in the market for a vehicle, it’s crucial to be aware of these – and how to avoid falling prey.
1. The Bait and Switch
Trick: Advertising a car at a great price, then telling you it’s sold only to push a more expensive model is a very common tactic the car dealership may use. This tactic is intended to lure unsuspecting customers – who don’t want to walk away empty-handed – and raise false hopes.
Counter: Insist on seeing the advertised vehicle – or simply walk away. Documentation of the ad can support a claim with an auto dealer fraud lawyer. A firm stance and preparedness to leave can prevent falling victim to this tactic, and keeping records is key to making any sort of legal claim.
2. Odometer Fraud
Trick: Rolling back the odometer to show a lower mileage than the vehicle has actually traveled is one of the oldest car dealership scams in the book. This dishonesty masks the vehicle’s true wear and tear, misleading buyers about its condition and value.
Counter: Requesting a vehicle history report is the first step to counting this trick. Additionally, always have an independent mechanic inspect the car before buying it – it will cost a couple hundred dollars, but it’s 100% worth it. A comprehensive vehicle history report and a professional inspection can uncover discrepancies, ensuring the mileage is accurate.
3. Undisclosed Salvage Titles
Trick: We see this one a lot. Dealers will sell a vehicle that’s been totaled without disclosing its salvage status to the buyer. Car dealerships can get these vehicles for very cheap and make a lot of profit selling them. They rely on buyers’ lack of information to pass off damaged goods as fully functional vehicles.
Counter: A thorough check of the vehicle’s history report will reveal its true status. If this is discovered after purchase, contact a dealership fraud attorney immediately for a free consultation. Diligent research and a vehicle history check can unveil a car’s past, safeguarding buyers from hidden dangers.
4. Inflating Prices
Trick: Adding unnecessary fees or services to the sale price without clear justification is one we see with car dealers relatively often. Dealers will disguise profit margins as “official fees”, exploiting the buyer in the final stages of the purchase.
Counter: Demand an itemized list of fees and research their validity. Knowledgeable auto fraud attorneys in California can review these charges if they seem fraudulent. Questioning each fee and insisting on transparency will help to deter these deceptive pricing practices.
5. Yo-Yo Financing
Trick: Dealerships will sometimes finalize a sale with an agreed financing plan, then call the buyer back to change the terms to more expensive ones. This strategy exploits the buyer’s financial uncertainty, pressuring them into unfavourable terms.
Counter: Secure financing from a bank or credit union before visiting the dealership to avoid this situation. Arranging your financing in advance can remove dealership manipulation, placing control back in your hands.
6. Pushing Extended Warranties
Trick: Insisting that you purchase an extended warranty as a condition of the sale or financing is common practice for some dealerships. Salespeople may misrepresent these warranties as necessary for loan approval, misleading the buyer.
Counter: Know that extended warranties are optional – and typically are not worth the cost. Politely decline and stand your ground. Understanding your rights and the optional nature of extended warranties can prevent unnecessary expenditures.
7. Concealing Defects
Trick: Hiding known defects or mechanical issues on a previously damaged vehicle from the buyer until after the sale happens a lot. They are required by California law to disclose if a vehicle is a lemon law buyback (was proven to be defective), but it doesn’t always happen. Dealers will sometimes mask these problems to make a quick sale.
Counter: Always have the vehicle inspected by an independent, trusted mechanic before purchasing. An independent inspection can reveal hidden issues, giving buyers the information needed to make informed decisions. You should also look into the vehicle’s history to see if it was ever proven to be a lemon.
8. Falsifying Income on Loan Applications
Trick: Overstating your income on a loan application to qualify you for a vehicle you can’t afford is rare, but happens from time to time. This practice endangers financial stability – as well as implicates buyers in potential fraud.
Counter: Insist on providing accurate information and review all documents carefully before signing. Honesty and vigilance in reviewing all loan documents can protect you against financial jeopardy.
9. Misrepresenting Lease Terms
Trick: Dealerships will sometimes present lease terms that are intentionally unclear or misleading, with the goal of pushing higher payments or penalties.
Counter: Read the lease agreement thoroughly and seek clarification from an auto dealer fraud lawyer on any points are unclear. A careful review of all terms, possibly with legal assistance, ensures fair treatment.
10. Fake Online Listings
Trick: Posting attractive – but nonexistent vehicles – online to lure customers into the dealership is another common trick, similar to the bait and switch. These fictitious listings are intended to lead buyers into high-pressure sales situations for different vehicles.
Counter: Request to confirm the vehicle’s availability via phone or email before visiting. Verifying availability directly with the seller can prevent trips to dealerships for vehicles that don’t exist.
11. Title Washing
Trick: Illegally removing a salvaged, flood-damaged designation, or previous rental car status from a vehicle’s title doesn’t happen often – but is a tactic used by the more unethical dealerships. This illegal act hides a vehicle’s troubled history, making it appear more valuable than it is.
Counter: A detailed vehicle history report should uncover any discrepancies in the title’s history. Insist on a detailed report from a reputable source to spot these issues before purchase.
12. Overcharging for “Add-Ons”
Trick: We see this one across the country, which involves charging exorbitant rates for additional features or add-ons that provide little to no value. Add-ons with inflated prices significantly increase the overall cost under the guise of enhanced value.
Counter: Specify that you do not want any add-ons or negotiate their removal from the deal. Declining unnecessary add-ons ensures you pay only for what you need.
13. Forging Signatures
Trick: This is another relatively rare one, but it happens: forging buyer signatures on contracts or agreements for terms not discussed. Forged documents bind buyers to terms they did not agree to, undermining their autonomy.
Counter: Review every document carefully and never sign a blank or incomplete contract. Personal verification of all contractual details before signing can prevent these fraudulent practices. If you’ve fallen victim to this, contact an auto fraud attorney immediately.
14. Refusing to Honor Prices Listed Online
Trick: Refusing to honor prices or promotions advertised online at the dealership happens all the time. Disregarding the advertised deals undercuts trust and exploits buyers and must be called out.
Counter: Print or save a copy of the advertisement to hold the dealership accountable. With proof of advertisement, you can demand they honor the deals online – or take your business elsewhere.
15. False Advertising
Trick: Like the last trick, advertising vehicles with options or features that they do not have is very common. Misleading ads draw buyers in with offers that don’t match the dealership’s inventory or pricing.
Counter: Verify all advertised features are present on the vehicle before agreeing to purchase. This helps you avoid bait-and-switch tactics.
16. “Lost” Key Scam
Trick: This is one of the, pettier, shadier tactics out there, and it involves the dealer claiming they’ve lost the second key to push you into buying another at an inflated price. Dealers create unnecessary expenses, profiting from manufactured problems like missing keys.
Counter: Negotiate a second key in the purchase agreement or seek a third-party solution. Including all necessary accessories in the initial negotiation prevents last-minute additional costs.
17. Rushing Through the Paperwork
Trick: Hurrying buyers through paperwork to prevent them from reading the details happens more often than many assume. Speeding through contracts can lead buyers to overlook important terms or hidden fees.
Counter: Take your time reviewing documents and consult an auto dealer fraud lawyer if your feel pressured. Insisting on a detailed review of every document ensures full understanding and agreement before commitment.
18. Manipulating Credit Reports
Trick: Misusing credit information – or lying about your credit score – to justify high interest rates happens from time to time. Misrepresentation of credit information can lead to unfairly high financing rates.
Counter: Know your credit score beforehand and secure pre-approval for financing. With knowledge of your own credit, you can challenge inaccurate assessments and seek fair terms.
19. Deposit and Down Payment Scams
Trick: Refusing to refund a deposit or down payment if you decide not to purchase doesn’t happen much, but it’s important to be aware of this scam. Non-refundable deposits or down payments lock buyers into deals, limiting their options.
Counter: Get all deposit and refund policies in writing before handing over any money. Clarified, written agreements regarding refunds provide a safety net if you end up reconsidering your purchase.
20. Undervaluing Trade-Ins
Trick: If you plan on trading in your car, offering significantly less than the fair market value for your trade-in vehicle is common practice for many dealerships. This is to maximize profit at your expense.
Counter: Research your car’s value beforehand and negotiate based on its true worth. Knowledge of the trade-in’s market value empowers you to negotiate more favourable terms.
What If You’ve Fallen Victim to Auto Fraud?
Now, I want to stress that not EVERY California dealership is a ruthless scammer looking to pull one over on you. The vast majority are ethical and do the right thing when selling a used car. But you should still be up to speed on common tricks.
If you believe you have purchased a vehicle with defects, you may be in luck.
California lemon law extends to used vehicles. If your vehicle was sold with a dealer warranty – of which is still valid – you may be able to seek justice from the dealership.
The first step is speaking with an auto fraud attorney. Cline APC has been representing California residents in seeking fair compensation after being sold a defective vehicle for many years. We’ll provide you with a FREE legal consultation to understand the depth of your situation – and determine if you have a valid case.
Call us directly at 888-982-6915, email info@clineapc.com, or schedue a free consultation.
