Signs of a Bad Dealership When Purchasing a Car

One of the stressful aspects about buying a car is dealing with rogue dealerships – while not all will be out to get you, some will do so, unfortunately. Handling these types of situations requires you to understand some of the tricks rogue dealers will use to get your money and scam you from a good deal, especially because dealerships are unregulated in the world of sales contracts and you cannot take them to court if something happens.

In order to get the most of your money, it is always good to do plenty of homework before buying a car and stay alert throughout the deal – particularly if you have bad credit. Any dealership can use these scams to con potential buyers, so you are paying more than you should – so here are some things to watch out for.

Yo-Yo scams

This is among the oldest tricks in the book when it comes to dealerships conning you off your money, and it particularly affects buyers with bad credit more often. The worst part about them is that you will never know what is happening until you give them your money and finalize the sale.

What happens in cases like these though? The dealer will start by showing you potential cars you can buy within your budget, and they will inform you of the cost. You will agree to purchase the car, and start arranging for financing of the sale. The dealer will then find a loan for you and create the contract, then you will glaze over the contract, sign it quickly, and leave with your car.

After some time, about a month or so, the dealer calls you back and informs you that the financing fell through, forcing you to come back. When you go to them, they tell you that you cannot afford the said car – so if you want to keep it, you need to pay higher interest rates or deposits, or else they will repossess your car.

When this happens, you wonder where you went wrong; and the answer is always in the contract – since you glossed over it, you missed the part that said the sale was ‘conditional’. Always avoid sales that give you conditions of ‘conditional’; you should always go for those that state the sale is ‘final’. If the sale is final, the only way they can take the car back is when they repossess it, and it is always for a legitimate reason.

Bait and switch

This is similar to the yo-yo scams, and is commonly used for people that have bad credit issues. The dealer will do the financial job, then tell you the cars you can get. If they are honest, then the deal will not be adverse on your end, but things can easily go south if they are dishonest.

Dishonest dealers will do this by stating a price that works for you, and then state a higher price in the contract. If you fail to read the contract thoroughly, this information will slip past you – and they will disagree with you when you want to finance the car on the price you agreed on with them.

However, nothing is legally binding yet, unless you sign the contract. If you encounter scams like these, the best thing is to walk away – since this is considered as a case of fraud.

Add-on fees

Certain dealers will add unnecessary costs and packages that increase the price, which allows them to mooch extra money off you. If you have bad credit, you might only be interested in getting any car that sounds like a good deal, so the dealer adds extra costs to the contract, which they will include in the total price. When reading the contract and seeing that there are some ‘add-ons’ that they did not tell you about, then inform the dealer that you do not want the extra costs.

When telling the dealer about it, make sure they remove it on the contract itself before you sign it. Verbal agreements are never enough, and dealerships can take advantage by bullying you and saying it is the only way to buy the car. This is completely false and illegal, so walk away if this is what the situation comes down to.

Scamming your credit score

If you have a good credit score, this will be detrimental to you. The dealership can trick you into thinking your credit score is bad, and if you already have bad credit, they will make your score seem worse than it actually is.

The result is that the dealer can raise the interest rates, which you will then have to pay on the loan when you buy the car. The idea of the strategy is forcing you to stay by telling you that you are getting a good deal, thanks to the higher interest rates.

The worst part is that you will never really know when this is happening to you, but you can always do preventive measures. Before going to buy a car, you need to ensure you find out your credit score for yourself, and use this information to your advantage. There are plenty of websites that will give you free credit reports, and you can utilize the information you get to negotiate a sale – because the dealer will never take advantage of you this way.

Poor quality of inventory

The thing is, many people want used cars to be as affordable as possible when buying them. The problem is that numerous cheap cars might have a ton of problems with them, and the dealer might never inform you about it – you will probably never know either, unless you get OBD scanners to do the job of checking the car diagnostics. If the selection of cars that are available seem like they are too old to be considered fit for service, then walk away to another dealership. You can read more about car dealerships on MotorBeast.


There are additional bad dealership signs that can come up, as we have only scratched the surface. If all else fails, then make a point of only going to the dealership when you know your credit score, and always read the contract no matter what. If you feel uncomfortable with a potential deal, it is always best to walk away from it.