«If they don’t, you can get one for about $20 from carfacts

canada goose Here's How To Avoid Getting Hosed By A Shady Used Car Seller Mandi Woodruff Nov. 7, 2011, 10:00 AM http://www.flickr.com/photos/maxoz/5655609277/ Cash-strapped consumers flock to Buy Here, Pay Here used car dealerships when their credit stinks, they need a car, and they don’t want to wait. But a recent L.A. Times article blows the lid off how these dealers target vulnerable, low-income consumers who eventually default on their loans. Once they’ve got you on their lots, dealers can sell cars for twice their actual value or jack up the interest rates on the loans they so «generously» offer consumers with bad credit. About one in four buyers will eventually default on their car loans, the Times reported. The dealership is then free to repossess their car and throw it back on the lot to be sold to the next sucker to wander into their trap. To be sure that sucker isn’t you, we hit up senior consumer finance advisor Philip Reed, who provides great tips for car-buyers at Edmunds.com. 1/ Know your dealer! c_neuhaus «Personal references are very important in this area,» Reed says. «I recommend getting as much information as you can about a dealership in advance.» If your pals aren’t giving you any leads, the FTC recommends hitting up the Better Business Bureau or your state’s Attorney General to see if a business has been flagged for complaints. 2/ Get real about what you can afford. «People want to go for a higher level of car than they can afford at the time,» Reed says, but shooting for a car that’s beyond your financial reach could wind up costing you big. Assess your finances and calculate how much you can afford to pay monthly on a car. In addition to the car value, you should know your credit score and the current average interest rate on used cars, Reed says. Get a free annual credit report from transunion.com, experian.com or annualcreditreport.com and visit Bankrate.com to crunch the numbers on interest. 3/ Shop around and compare other loan offers. YouTube ptreducto In the L.A. Times article, a dealer talked a couple with bad credit into putting $1,000 down for a 2003 Mitsubishi and paying an interest rate of 25.99%. Consumers with low credit scores know they won’t qualify for a decent loan, so they turn to Buy Here, Pay Here lots because the dealers offer financing on-site. But dealers tack on outrageously high interest rates for loans and set their own payment schedules. And expecting the dealer to tell you your financing options is a big no-no, Reed says. «First of all, you’re trapped,» he says. «You have no leverage in terms of comparing payments or any other kind of offer unless you want to make calls on your cell phone while you’re there.» Compare the dealer’s loan offers with other businesses first, and be wary of ads targeting consumers with bad credit or that promise financing. Check out the Federal Trade Commission’s guide on buying a used car for more information about financing options. 4/ Ask for an inspection. To avoid any cash-draining surprises down the road, ask for an inspection of any car before you open your wallet, Reed says. «Dealers will have car facts history report and you can request it,» he says. «If they don’t, you can get one for about $20 from carfacts.com or autochecks.com.» If a report isn’t available, it’s perfectly OK to request an inspection—you’ll just have to pay for it yourself. Ask friends for referrals for a good mechanic or check the Yellow Pages, the FTC advises. 5/ Never accept the upfront price. Avoid winding up like the Cvitanovs, who agreed to a price on a car for $5,500 more than it was worth, by knowing how the car’s value in advance, Reed says. «For these people to go onto a car lot and accept the price upfront, this is not a smart way to make a good deal www.canadagooseonsale.biz ,» Reed says. «Use the Internet to get comparative prices and do your research. [Finding out the car’s] value is the easy part of the question.» Use sites with free car value calculators like Edmunds.com and Kellybluebook.com to get a sense of how much you should pay for a used car. If you come armed with that information, the dealer will be more likely to negotiate. 6/ Use an app to help you negotiate. Ellis Hamburger, Business Insider Apps for buying a used car are pretty ubiquitous. Plus, if you can whip out your smartphone and show a shady dealer he just lied about the true value of a clunker, then you’ve got negotiation firepower in the palm of your hand. VIN Hunter lets you punch in the Vehicle Identification Number (every car’s calling card), track its history, and compare prices. Also try Black Book iUsed Car, Edmunds, or Kelly Blue Book. 7/ Run the numbers. Flickr Sybren Stüvel In the article, Nou Lee signed a loan contract on a used car that said she would pay a 12% interest rate. But when she started getting bills, she realized her interest payments reflected a rate nearly double what she expected. «Do the math,» Reed says. «Since (interest payments) are spread out over time, people don’t realize how much the interest really is.» Ahead of time, calculate your payments at various rates of interest so you’ll have an idea of what the exact dollar figure is before you sit down to hash out a loan contract with your dealer. 8/ Get everything in writing. <a href="http://www.flickr.com/photos/michaelsphotos/108057939/">michaelsphotos</a>viaFlickr Bor Pha trusted her dealer’s assurance that she would only pay 12% on a loan. But she found out too late that she was actually paying more than 20% in interest per month. No matter what a dealer tells you, it only counts if it’s written in black and white. «Don’t rely on spoken promises,» the FTC says. «They’re difficult to enforce because there may not be a way to a court to determine with any confidence what was said.» Dealers are on the lookout for vulnerable consumers who may be ignorant of their rights as a buyer and they’re pros at sniffing them out, Reed says. 9/ Never visit the lot. AP When Tiffany Lee fell behind on her used car payments, she was led to believe the dealer would be kind enough to work with her to make her loan more affordable, the L.A. Times reported. But the minute Lee set foot on the lot, the car was repossessed before she knew what hit her. «The whole mindset of the dealer, whether it’s a legitimate dealer or any one of these fly-by-night predatory dealers canadagooseonsale , is to get the consumer on the lot,» Reed cautions. «They have free things they give away, and they advertise that it’s a $25 gift value and the thing is a little piece of junk.» 10/ Remember, you do have options! Nearly all the buyers’ stories in the article shared a common thread: They figured they had no choice. «They feel like they have no options so they basically just throw themselves at the mercy of the dealer,» Reed says. You may have lost your job or seen your credit score tank after falling behind on your mortgage, but there’s one thing consumers never lose, Reed says: the power of negotiation. «There’s hundreds of these [Buy Here, Pay Here] places, so your leverage can be competitive bidding. Tell them you’ve looked at the prices and you’re willing to pay the finance cost, but only if it’s such and such. If you don’t get the price, then go somewhere else.» 11/ Cars aren’t the only thing you can buy used … Jill Krasny Click here to see 10 things you’re better off buying used > Previous 1/ Next canada goose parka