Strangest Car Dealer Experience - Did They Try and Scam Me?

In My Humble Opinion
1

Warning Long Story Ahead

I am a bit conflicted this morning because I absolutely love the new Ram 1500 4x4 Longhorn edition I just purchased Saturday night and I am confident that I got both a good if not great deal in terms of price and financing. I also really liked the sales rep and “finance manager” during the experience.

However two things happened during the transaction that I now believe were clear “sales tricks/tactics” at best and outright scams at worst so I wondered if any of you had or heard of a similar experience. First let me preface with two facts: I usually buy cheaper used cars that I can pay cash for and had not financed a car in a decade. Second I have an absolute OCD when it comes to my credit score and check/manage if religiously through creditkarma. That said here is my story of not one but i believe two scams used on me that i believe i avoided… barely.

After haggling for the better part of two days on the price for my loaded longhorn we reach the credit application phase. My credit score is consistently above 800 and has been for years. I told the sales rep that there was ZERO chance I would pay any interest rate above 3 percent and let him know my score, he agreed. When he came back a few minutes later I was told my score was “not quite as high as I thought” and came in at 733 to which I refuted immediately. He offered to show it to me and produced a printed document that showed 733 from transunion but looked clearly like an inhouse word template. This was accompanied by an offer of 4.99 percent which was instantly refused.

I then proceeded to pull my credit score app and showed him two scores from equifax and transunion of 811 and 807 respectively. His response was that they get this a lot and that "most consumer apps/sites like creditkarma are not accurate and that his score was “straight from transunion”. After telling him that - as i said - i would NOT pay over 3%, he went back and “fought for me” and got me down to 3.35. I relented on this number because at the time I did not even think for a minute that the dealer may literally be lying to me.

However after sleeping on it and worrying over my credit i ran across this site and many others like it: Lie To The Buyer About Their Credit Score Scam that speak to this “scam”. This begs the question if indeed they lied to me, how is that not illegal?

The second scam I was well prepared for but thrown a funny twist i wanted to share. We all know the finance guy should really be called the “get more money from the customer via extended warranties and services guy”. I actually wanted an extended warranty this time since it was a 50k purchase with nav and air ride and because i plan to keep it forever but i was ready to battle.

As most of you know Ram and most manufacturers offers extended lifetime warranties that some find very valuable despite its cost. So after literally an hour of haggling from the starting price of $6,000 (included liftetime powertrain and electronics warranty, gap coverage, wheel and tire coverage for 60k, some resistall paint protection, a 10 oil change maintenance contract and paint and dent repair coverage) we eventually got down to $2,875 by removing the gap, wheel and maintenance and refusing the covereage all together FIVE TIMES… seriously lol (again I planned to get so I felt i was working him).

THEN the strangest thing happened that i immediately thought was a tactic but amazed me nonetheless. After the 5th refusal, he said to me “what if I call the bank and get you a friends rate discount?” I was floored!.. I said that a lower rate might get me to reconsider. The finance guy picks up the phone and calls or pretends to call someone at the bank and i hear him say “Hey I have a loan account ###### for Rich ####… he is a dear friend of the family, can we get him a better rate than this 3.33? I will make it up to you on the next one”… he hangs up and says they are “running it up the flag pole”… 10 minutes later he looks at his computer screen and says YEAH man, 3.15! then puts his fist out for me to bump it! LOL… is that not the ballsiest move ever or am I flat out wrong and there is some chance he actually did that?
I ended up paying the 2875 for the lifetime, the resistall and the paint/dent contract. While I know its expensive and they push it HARD, if i own this truck for 7-10 years and that nav or air ride goes out… or any other major system, i paid for the contract.

I must say that I actually enjoyed working with both guys, but cannot help but feel they tried and mostly failed to scame me… Anyone ever experience anything like this?

2

Once you start to argue with a car salesman (and/or any other supervisors, managers or specialists), you’ve probably lost.

With a FICO in the 800s, you were in an excellent position to do what everyone should do: walk in with a down payment check and prearranged financing from a bank or credit union. That gives you absolutely immense leverage, cuts out nearly all of the BS they can run on you, and makes things like “No, I won’t take all these dealer add-ons; bye!” a lot easier.

But the minute you walked in, obviously ready to drive home a new truck on pretty much whatever terms they cared to sell it to you, you might as well have poured meat juice all over yourself and jumped in a bear cage. Seriously.

Being completely prepared - all homework done on models, options, manufacturer and dealer practices, and bringing your own payment - greatly limits the number of shells and peas they can use to game you into paying far more than you wanted, and likely for things you didn’t want. By the time you’re sweatily wrassling over a fraction of a point on the loan rate, they’ve already locked you into thousands in extra profit and are just playing with you.

And yeah, they’re all really nice guys to spend time with, aren’t they? :rolleyes:

3

Addendum: Going home and doing car-buying research after you’ve bought the car is… not optimal.

4

Was not really posting my experience to get a lecture, but thanks dad :smiley:

I would like to hear if anyone has experience with wildly varying credit scores that are always lower at the dealer… as well as the “call the bank dear family friend discount” trick.

Thanks!

5

According to the RAM website, that truck has financing incentives – 0% for 36 months, or 2.9% for 84 months. Did you buy this from a RAM dealer?

6

But to answer your question, yes, I’ve experienced something similar. They didn’t lie about my credit score (I don’t think I actually saw it), but I walked in knowing I had a score around 800 and offered me something like 6.9%. I balked and they insisted that more score wasn’t that good and that was the best they could do. We ended up settling at 4.9% after one of those “Let me see if I can sweet talk the finance guys because I like the cut of your jib” phone calls. That was still a stupid high rate for me to pay but I made the cardinal mistake of getting attached to the car so I agreed and paid it off as quickly as I could.

7

they frequently use an “auto adjusted” credit score, and not your overall FICO score.

8

OK, first off, you are being very rude to people, that, I remind you, you invited to comment. If you really want to know whether you got taken or not, you could go to your bank and see what loan rates they would advance you. You really should have done this before shopping, but what’s done is done.

If we’ve heard of such scams, what difference would it make since you’ve already closed the deal under those terms?

I’ve not heard of the specific scams you describe, because, as the other poster suggested is wise, I don’t do dealer financing. But yeah, you probably got taken. My credit score hovers between 790 and 800, and earlier this year I got a used car loan at 2.25% from my (Texas) credit union. New car rates, I believe, tend to be slightly lower.

Yeah, OK, you liked the guys, but that’s what the pros do: make you feel good about being shafted. Thinking rationally, should it really take nearly three full days to coerce the dealer into parting with one of the vehicles on their lot? Sheesh.

9

If you want to read it as a lecture, fine.

But you went into a dealership to buy an expensive, loaded vehicle, got yanked around nine ways from Sunday (and Monday), and then asked a detailed question about whether patently bullshitty tactics and claims were “normal.”

Google Damon Runyon and “earful of cider.” Son.

10

Followup:

I’ll agree that dealer financing makes sense if you know in advance that you are eligible for a rate you couldn’t get from a bank, i.e 0% deals. Absent that, however, some due diligence is necessary.

11

And banks don’t.

If you have excellent credit (and 750+ FICO is), you go to a first-line lender, the one most schmoes buying a pickup truck can’t. That way, you get first-line rates and treatment, not a three-day turn in the barrel.

Dealer credit is for people who have no other choice and should never be used for anything but the most basic transportation needs. Not loaded anythings. If you can’t get good loan terms, you can’t afford “loaded.”

12

Didn’t OP get the interest rate and other things that he wanted from the outset? While I agree there were probably easier ways to get there, I don’t really see this as a case of OP getting shafted, not as things are described here anyway. They tried to shaft him, but it appears they failed to do so.

People get so weird and lectury about car sales stuff. I actually agree with the point about doing your research beforehand, not doing dealer financing, etc. But given the OP didn’t do that, it seems all indications are they still did a pretty good job of getting something they knew beforehand would be something they were happy with so…

Yeah, let’s just answer OP’s question.

Which, said answer is, yes, those are two “sales” techniques that are often used.

13

I was not trying to be rude, just playful banter but maybe you guys are grumpy this morning. Anyway my apologies. I thought the finance guy calling me his dear friend to a banker for a lower rate was amazing and likely staged… I thought that would be interesting to you guys and simply wanted to share that and the credit score question.

Perhaps I gave too much detail and obfuscated the intent.

I ended up at 3.15% on a USED CPO truck that was exactly what I wanted. I got a price that was a full 4k under the edmunds.com fair dealer retail and 1.5k under what they consider fair private party and i am paying what amounts to a little under 500 a year to finance the whole thing with not a dime for a downpayment.

I really do not think I got taken in any way shap or form unless you count the time spent there which albeit was extended.

You guys have a great morning… and get some coffee! :smiley:

14

It definitely sounds like a dodge to me. Your credit score will certainly vary between the three companies, yes, but I wouldn’t let anyone else show me what they brought out without some real back up.

Best advice now: head for a credit union and see what they can give you to refinance the loan. Around here I can get less than 2% with that sort of credit score. Alternately, return the truck and cause a fuss. See what they do.

15

I. Clearly, there was a better than zero chance you would pay more then 3% for a car loan because you did. The higher your interest rate is, the more money the dealer will make. The dealer believed you would pay more than 3% and he was right. He made more money at your expense.

II. As others have noted, there is more than one credit score. Transunion will even calculate multiple credit scores based on proprietary models created by the dealer. Those scores might top out at, let’s say, 733, so no one gets a higher score than than. Other people with standard FICO scores of 790 might score only 690 on this proprietary model. Without knowing which credit score model the dealer used to evaluate you, I can’t know whether they used this score or just made one up because your shoes weren’t shined to their liking.

III. Yes, it might be fraud to claim they got your credit score from Transunion if they just made the number up. To assert a fraud claim in the state where I live, you would need to show that:

  1. They made a false representation that was material to you. It may seem obvious to you that they did but it’s not that clear to me. I will assume that they lied to you about your credit score. The issue is whether that’s material to you. What you cared about was the interest rate on the loan, not your credit score. They didn’t lie to you about the interest rate. Perhaps you can argue that had they not lied to you about your credit score, you would have shopped around for a better interest rate but you thought it was hopeless because of your mediocre credit score. This is actually a pretty poor argument because nothing stopped you from shopping around for a better rate if that was important to you.

  2. They knew the statement was false. The sales rep showed you the form. Did he print it out? Did he make the number up? Good luck proving that he knew the statement was false. Perhaps you can show that at least someone in the dealership knew the statement was false and you can impute their misrepresentation to the dealership.

  3. They lied with the intent to defraud you. They are unlikely to admit they were trying to defraud you. Honestly, if you can show the first two, you might have a good chance of drawing an inference that they were attempting to defraud you.

  4. You relied on the misrepresentation. In this case, it actually counts against you that you knew that your credit score was higher. You weren’t relying on their misrepresentation to know your credit score; you showed them your higher credit score while you were in the dealership. You should have used your knowledge of your high score to shop around for a better interest rate. You should have walked out on the deal at this point because you knew they were trying to screw you. Instead, you accepted the screwing even though you weren’t relying on their misrepresentation.

  5. You were damaged by the misrepresentation. You would have to show that you would have received a lower interest rate had they not lied to you. Since you didn’t shop around for a better rate, no one else knows whether you could have received a better rate. You could shop around now and find a better rate but that doesn’t necessarily prove that on that day, that interest rate is the one you would have gotten. They can argue that you wanted the car so badly on that day that weren’t willing to shop around and lose the deal. They can argue that any theoretical lower interest rate wasn’t that important to you because you wanted to leave that day with a truck. Unfortunately for you, this seems to be true.

To prove these elements, you’d probably need to hire a lawyer who will charge money. Given the relatively low interest rate involved and the small difference between the rate you paid and the one you might have been otherwise received, your potential damages would probably be small. The odds of you hiring a good lawyer to represent you in this case for less than the amount of the potential damages is slim.

You could file a complaint with your attorney general and the Consumer Financial Protection Bureau (http://www.consumerfinance.gov/complaint/). Be sure to submit the sheet they gave you with the potentially bogus credit score and any evidence you have that your actual credit score is better.

The better advice, as others have noted, is to get your financing lined up with a bank or credit union before you go car shopping. Then, if the dealer can’t do better than that rate, don’t finance through them.

16

Concur.

Laugh. I suspect the “buyer’s remorse” period is over, for one thing. Also, once you drive off the lot, even if you back up into the finance manager’s office, it’s now a “used vehicle” and the buyer can be held responsible for the drop in value.

17

How does getting a bank loan on a used vehicle work? Do you need to go into the bank saying “I was planning on buying this 2013 Yadda-Yadda for $11,250?” or go in saying “I want to buy a used car for under $15k, what sort of rate can you give?”. In other words, how committed to a select car do I need to be to start the process?

Seems like it’d be easier when you’re buying new and the car can be customized and delivered to the dealer versus each used car being essentially unique. But I’ll be in the market for a used car in about a month and also have excellent credit (820) so might as well take advantage of it. Been forever since I financed a car though and last time I did I had, uh, less-optimal credit and took whatever that dealer (CarMax) gave me.

18

OK, fair enough.

Your OP mentioned your "new Dodge Ram’. OK, so I guess you meant new to you.

19

The way I did was basically the second one you mentioned (the car was purchased from CarMax, so, fixed price): I told the credit union the max price I was planning to spend and my planned down payment amount; they issued a note stating I was good for credit up to $XXXXX; once I had the car picked out I completed the paperwork with the credit union for the actual loan amount, the credit union faxed the loan agreement to the dealer and I took delivery. This may vary a bit from dealer to dealer but your bank/credit union should be able to walk you through the procedure.

20

Go in and ask them for the maximum you can borrow with various down payment options. All things being equal, you probably want to put the maximum down, but that can change if, for example, you buy a car that will immediately need $800 in tires or other service. Adjust your down payment amount to something comfortable, and if the maximum the bank will loan is way high, ask them for more than one lending letter - one at or near the max, and one capped at the reasonable amount you want to spend. That way, you don’t show a letter saying you can afford a $40k vehicle when you’re trying to negotiate a $15k deal.

Credit unions in particular are easy to work with on this process. Community banks, too. Majors can be a PITA, with a whole shelf of lending rules that keep them from being your buying partner.