What does this mean, that car dealer is "playing with the system"?

[Misnomer]

@DrDeth

they sell you a car with payments you can’t afford

What, the dealer also holds a gun to your head? If you can’t afford the payments, don’t buy the car (or the house, etc.).

[Todderbob]

@DrDeth

@Todderbob

[Thats a Buy-Here, Pay-Here lot, garunteed. It’s almost impossible for what you said to happen working with an outside lender.

At a buy here pay here lot the car is financed privately, at Usury-bordering rates, installed with a GPS tracker and if you are 30 minutes late the car turns off, they pick it up, and file a suit almost immediately. They then, legally, must sell the car at auction, publish the times, and take the sale value of the car out of your debt.

In reality, they hold a private auction, with only thrum present, and buy all the cars for 20 bucks. You could attend the auction, but first you’d have to know where/when it is.

Yes, they are indeed “Buy here Pay here” type used car lots. I see you are also familiar with the scam.

Its not a clear cut scam, honestly. There are people who abuse the system (in the same way people use and abuse in house credit card sign ups in stores like best buy or circuit city), but it’s also a genuine business model.

Buy an inexpensive car, and sell it with enough mark up to cover the likely loss and termination of the contract (which happens at buy here pay here often, there’s a reason people have shitty credit – and its not usually because they pay their bills on time), possible distraction of property, likely litigation fees, etc and hope for the best.

Buy here pay here lots make more money on people who pay than people who don’t, at least decent ones (in my experience).
You are correct that some people abuse the system, but its not a scam – the terms are, or should, honestly be laid out up front.