CHARLOTTE — Buying a car is one of the biggest purchases most Americans will make. While the process can be confusing and intimidating, consumer adviser Clark Howard has some tips to help you avoid making big mistakes.
The good news is that the number of cars for sale, as well as the prices of those vehicles, are better now for consumers. But it is possible to turn a good thing into a bad thing into a good thing if you don’t read the paperwork.
When you are in the market for a new car, some pitfalls are hard to avoid.
Lori Silverman, leader of Howard’s consumer action center, said car buy complaints are one of the most common calls they receive on their tipline.
“So one of the biggest calls we do get is cars,” Silverman said.
Charles Winans said he was one of those callers after his wife bought a new Hyundai Santa Fe last year.
“She was having a good time there, and they evidently were fostering a lot of that, all the way to the end, where they got her to sign at the bottom of that sales agreement,” Winans explained.
A sticker on the vehicle touted an add-on $1,495 protection plan, which included a $500 deductible reimbursement if an accident were to occur in the first year.
And of course, an accident did occur. However, “they said that, uh, we didn’t qualify,” Winans said.
Winans said when he took a closer look at the contract his wife signed, he noticed an extra $2,000 tacked onto the sales agreement above the window sticker price.
“I guess it could have been a seven, and she might have noticed that. She was more interested in the add-ons,” Winans explained.
The consumer action center reached out to the dealership, and they reimbursed the Winans’ $500.
“The protections that exist are, um, to make sure that there is, you know, transparency and pricing and to make sure that dealers, uh, don’t take advantage of consumers,” said Federal Trade Commission Attorney Edward Smith.
Smith said the proposed combating auto retail scams or car rule aims to strengthen that protection for consumers like Winans.
“What this rule does is protect consumers from bait and switch tactics, and it protects consumers against hidden junk fees,” Smith explained.
The FTC estimates the car rule will save consumers $3.4 billion each year. The rule is facing legal challenges from the auto industry, but there are steps you can take to protect yourself.
First, get financing before you ever set foot in a dealership. Second, if you are buying a vehicle, take it to a mechanic and have it looked over before you buy.
Third, take someone with you to the dealership, and make sure you understand what you are signing. Finally, don’t feel pressured to make a purchase.
“If somebody is pressuring you to buy something, take a pause, and you can walk away. Trust me, it will be there when you come back,” Silverman said.
The more you know, the better your car-buying experience will go.
VIDEO: ‘It’s been frustrating’: Dealership pulled bait & switch on car, customer claims
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