When you're going in for your next car purchase keep your eyes peeled for the following scams.



1. The VIN# window etching scam

Some dealers will charge you $300-$900 for window VIN# etching and tell you that you have to pay the money to get the loan because the bank insists on it. Don't go for 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. Anytime a dealer says something is free, get it in writing and check your monthly fee. 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 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 regular payments on time.

2. The Financing Scam

You trade in your old car in and the finance manager signs you up at the agreed interest rate and gives you the car. After a week or two passes and he/she calls saying that you didn't qualify for the interest rates that they gave you when the deal was made.

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 an opening to get more money out of you. All that this clause means in the contract is that the deal is not finished yet even if 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 believable.

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 is desperation in action. 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's pretty hard 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, you might want to shop elsewhere because that dealership is sleazy. Don't hesitate to let them know it too because it'll be nice to watch them try to back out of that one.

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. It's hard to believe they even try this. Why would the bank trust you to pay a $22,000 loan for the car, but they will not trust you to pay for a $20,000 loan?? That's just insane.

You can avoid this scam by forcing them to put it in writing that you "have" to pay the extended warranty in order to get the loan. Just let them know you'd like to check with the contract your local State's Attorney's office for validity and they'll drop the extended warranty in a heartbeat.

5. The Dealer Preparation Scam

Unfortunately, this is legal and very much common practice. I still refer to it as a scam because it is just another way to get more money from you for nothing. The dealer will tell you that you have to pay an extra $500 to cover the labor costs of the dealership's 5-point inspection.

This alleged check up that you are paying so much money for, is for the dealership to remove plastic from the seats, vacuum the car, maybe, and make sure all of the fuses and fluids are ready to go. When factories deliver the new cars to the dealerships the cost of delivery and preparation is already covered, so basically you are paying the dealership for work that they haven't really done.

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, the choice is yours. If you think its fine buy the car, if not; try another dealer that will remove the dealer preparation costs.