Apply the Brakes to Unfair Auto Loans

  
     
August 03, 2017

To many, there is no better feeling than the purchase of a vehicle. For most Americans, a car is seen as not only a means of transportation but a measure of freedom to be able to go anywhere at any time.

Better Business Bureau Serving Acadiana reminds consumers there are pitfalls to avoid during the buying process, especially if credit scores are less than perfect.

Some unscrupulous lenders and dealers take advantage of those in need of a vehicle and offer auto loans on deceptive terms, resulting in much higher balances than initially expected. Unfair auto loans can lead to the loss of your car if you are not able to make loan payments.

Non-payment of an auto loan can also hurt your credit and make it harder for you to get a job or an apartment.

BBB offers the following tips to avoid unfair auto loans:

  • Start With Trust®. Check with BBB before doing business at bbb.org.
  • Know what you can afford to buy. Be sure that all of the potential purchase and loan finance costs will fit into your monthly budget.
  • Shop around. Compare prices, and if possible, get pre-qualified for an auto loan. It is a major advantage to walk into a car dealership knowing that you will have financing available to you on terms you can accept.
  • Check all the terms and fees before you sign a contract. Once you have signed the auto loan paperwork, it is very difficult and often impossible to get out of it. Don’t sign anything that you cannot read or understand.
  • Watch out for fees and extra costs. Unfair lenders may try to sneak extra fees or costs into a loan. If you have doubts about the loan terms or fees, be ready to walk away from the deal.
  • Don’t sign an agreement under pressure. Some unfair companies may try to rush consumers into signing a bad deal quickly, by pretending they won’t qualify for a loan anywhere else.
  • Make sure all copies of the agreement are identical. All copies of the loan agreement should reflect the same, complete terms and conditions you discussed and agreed on with the lender or dealer. Deceptive dealers and lenders may slip a different, unfair agreement into a stack of papers to get you to sign then pretend that this is what you agreed to accept.
  • Never sign an agreement with blank spaces in it. Unscrupulous dealers or lenders can fill in abusive auto loan terms later on.
  • Always get a complete copy of the signed agreement. Ask if the lender can provide a full copy of whatever you sign – before you actually sign. If the lender refuses to provide a copy, this is a big red flag that something is wrong.
  • Always get a receipt for payments and trade-ins. Some unfair businesses may take your money and pretend that your payment never happened or claim that your trade-in value was less than what you were initially told.
  • Don’t leave the dealership with the car if the financing isn’t final. Do not drive away with the car if financing is offered on “conditional” terms. An unfair dealer might try to use this as an opportunity to change the terms of the financing deal to your disadvantage.

 

“Look for the Seal” and Start with Trust®. BBB Serving Acadiana is a private non-profit organization that strives for a trustworthy marketplace by maintaining standards for truthful advertising, investigating and exposing fraud against consumers and businesses.

Please contact Better Business Bureau at (337) 981-3497 or at bbb.org 24 hours a day for information on businesses throughout North America. Consumers can also sign up for our free BBB “Scoop” eNewsletter by visiting bbb.org and clicking on the “Programs & Services” tab.

BBB Serving Acadiana covers the parishes of Acadia, Evangeline, Iberia, Lafayette, St. Martin, St. Landry and Vermilion.