Calgarypuck Forums - The Unofficial Calgary Flames Fan Community - View Single Post - Hidden camera investigation finds most Calgary car dealerships breach consumer rules

curves2000 · 03-20-2017, 12:42 AM

Here are some tips for buyers who are looking at new or used cars from a dealership to try and avoid getting royally screwed by the little things.

1) Do not negotiate or work with a sales or finance person strictly based upon your monthly payment budget. When you work straight off payments with the dealer there is a real possibility that you end up paying substantially more for a car than it's actual cost. Say your budget is $400 a month, I have seen people purchase cars that should have only cost $10-11k and they are stuck into a 3 year loan @$400 a month. This means total payments WITHOUT interest is $14 400.

Find a car you think you might be able to afford, get the price, than work on financing.

2) Always get the price of the car your looking at buying written down and confirmed. If you have a trade, get the appraisal of your trade separate. This avoids a scenario where the dealer might offer you a higher value for your car and than just bump up the price of the new car. This is a tactic used all the time to close deals. Get an extra couple of grand on the trade and then bump the price of the new/used car your buying.

3) If your financing make sure you get a full copy of all the available credit options if you get approved. The lenders are paying the dealership a commission in order attract the lending business and generally speaking, the higher the interest rate and the higher the total cost of borrowing (total interest payments if the loan is paid at the end) the higher the commission to the dealership.

If a bank is offering a rate of 2.99% and another bank is offering 7.99% than you can bet they will probably select the higher rate option. The credit application is just completed and than the approvals come back onto the screen for the finance manager to select. Remember, the sales person and the finance person are also making a cut on the deal.

Don't fall sucker to things like life and disability insurance coverage on any lending products. These insurance products don't offer much in the way of protection, have really high premiums for the coverage involved. If you need actual insurance coverage, call a licensed insurance broker to underwrite a policy for things such as disability/ life insurance. Insurance is important but the stuff offered at the dealership isn't great. I can go into details in another thread about why.

Unless it's an amazing deal, don't fall in love with the car to avoid it clouding your judgement. Far too many people get financially ruined with these car dealerships and nobody out there regulates these shady practices. In the CTV News story they kept focusing on things like fee's and added charges above and beyond the advertised prices but the stuff I talked about above is also something to watch out about.

Happy shopping to all!

03-20-2017, 12:42 AM	#21
curves2000 Powerplay Quarterback Join Date: Dec 2013 Location: Calgary, Canada Exp:	Here are some tips for buyers who are looking at new or used cars from a dealership to try and avoid getting royally screwed by the little things. 1) Do not negotiate or work with a sales or finance person strictly based upon your monthly payment budget. When you work straight off payments with the dealer there is a real possibility that you end up paying substantially more for a car than it's actual cost. Say your budget is $400 a month, I have seen people purchase cars that should have only cost $10-11k and they are stuck into a 3 year loan @$400 a month. This means total payments WITHOUT interest is $14 400. Find a car you think you might be able to afford, get the price, than work on financing. 2) Always get the price of the car your looking at buying written down and confirmed. If you have a trade, get the appraisal of your trade separate. This avoids a scenario where the dealer might offer you a higher value for your car and than just bump up the price of the new car. This is a tactic used all the time to close deals. Get an extra couple of grand on the trade and then bump the price of the new/used car your buying. 3) If your financing make sure you get a full copy of all the available credit options if you get approved. The lenders are paying the dealership a commission in order attract the lending business and generally speaking, the higher the interest rate and the higher the total cost of borrowing (total interest payments if the loan is paid at the end) the higher the commission to the dealership. If a bank is offering a rate of 2.99% and another bank is offering 7.99% than you can bet they will probably select the higher rate option. The credit application is just completed and than the approvals come back onto the screen for the finance manager to select. Remember, the sales person and the finance person are also making a cut on the deal. Don't fall sucker to things like life and disability insurance coverage on any lending products. These insurance products don't offer much in the way of protection, have really high premiums for the coverage involved. If you need actual insurance coverage, call a licensed insurance broker to underwrite a policy for things such as disability/ life insurance. Insurance is important but the stuff offered at the dealership isn't great. I can go into details in another thread about why. Unless it's an amazing deal, don't fall in love with the car to avoid it clouding your judgement. Far too many people get financially ruined with these car dealerships and nobody out there regulates these shady practices. In the CTV News story they kept focusing on things like fee's and added charges above and beyond the advertised prices but the stuff I talked about above is also something to watch out about. Happy shopping to all!