Dealership Spot Financing Scam? Need Azine's advice
12-20-2013, 06:45 PM
#1
Burning Brakes
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Dealership Spot Financing Scam? Need Azine's advice
My fiancee was looking at a used car in October, put a deposit down one night via email, with a salesman after business hours. Then applied for separate financing that night with a credit union and was approved. The next morning the salesman called and said the car sold the night before and was no longer available.
Then in early November she called the credit union to cancel the loan and tell them she never purchased the vehicle. She also went to Honda (a different dealership) and purchased a brand new vehicle using the Honda Graduate program and financing. According to the dealership she had a credit score in the mid 700's. Then, about a week later the dealership called and said she was denied financing because the other loan had not been removed from her credit report and they could not provide the financing and graduate incentive because of the existing loan. She called the credit union several times and requested they fax a letter to the dealership stating the loan was voided. The dealership said they never received any of the faxes.
In order to get the issue over with I went in and co-signed on the loan. Now a month later I get a letter in the mail (from the dealership, not Honda Financial Services) saying I have been denied the financing because of too many inquires, lack of installment loans, age of accounts etc. I have no negative history but I do have several new credit cards in the last year, all in good standing. They stated I have a credit score in the low 700's. The free credit scores provided by my bank and one of the free credit score sites all state I have a high 700 credit score. I know there are different scores etc but a 70 point difference seems extreme? We both have professional careers, relatively high income and credit scores in the 700's. It seems odd that we would be denied good financing. The only reason we financed is due to the promotions offered with Honda Financial Services with cash incentives and a very low interest rate (below inflation).
What are my options here? The car has already been registered and property taxes paid. We have had the car for nearly a month and a half. I have never liked this dealership and always thought they were very much a stealership. I shopped around online with lots of dealerships, and the only reason I went to this one is because they were able to offer me the best deal. I made a final verbal offer to them over the phone right before we went in to purchase. Then when we got to the dealership, the verbal offer immediately became a "misunderstanding" and the price went up $300 to the lowest email price we had. I was about to walk out, but it had been a long day and I was ready to get it over with. The dealership also lied to me several months before regarding the graduate incentive and financing rates when we were looking at cars. I guess those should have been red flags.
My research leads me to believe I can return the car to the dealership (I am sure they want a car with nearly 2,000 miles on it). I am seriously considering doing that now, and purchasing the car from another dealership in cash (I have the cash to do that, unknown to the dealership). Is this a bad idea? Is the dealership playing games with me? I can only imagine I will get a call in several days with them trying to get me to sign a loan with a higher interest rate for the car.
Cliff Notes:
Fiancee Bought a new Honda with Honda Financial Services
A week later dealership says she was not approved due to a recent voided car loan on her credit report that had not been removed
I co-signed on the loan
A month later I get a letter from the dealership saying I have been denied financing
Both have upper level professional salaries and 700+ credit scores with short, but no negative history
Is the dealership playing games? Can I return the car (now a month and a half old and 2k miles) and go buy one from another dealership cash? Is this the best move?
Then in early November she called the credit union to cancel the loan and tell them she never purchased the vehicle. She also went to Honda (a different dealership) and purchased a brand new vehicle using the Honda Graduate program and financing. According to the dealership she had a credit score in the mid 700's. Then, about a week later the dealership called and said she was denied financing because the other loan had not been removed from her credit report and they could not provide the financing and graduate incentive because of the existing loan. She called the credit union several times and requested they fax a letter to the dealership stating the loan was voided. The dealership said they never received any of the faxes.
In order to get the issue over with I went in and co-signed on the loan. Now a month later I get a letter in the mail (from the dealership, not Honda Financial Services) saying I have been denied the financing because of too many inquires, lack of installment loans, age of accounts etc. I have no negative history but I do have several new credit cards in the last year, all in good standing. They stated I have a credit score in the low 700's. The free credit scores provided by my bank and one of the free credit score sites all state I have a high 700 credit score. I know there are different scores etc but a 70 point difference seems extreme? We both have professional careers, relatively high income and credit scores in the 700's. It seems odd that we would be denied good financing. The only reason we financed is due to the promotions offered with Honda Financial Services with cash incentives and a very low interest rate (below inflation).
What are my options here? The car has already been registered and property taxes paid. We have had the car for nearly a month and a half. I have never liked this dealership and always thought they were very much a stealership. I shopped around online with lots of dealerships, and the only reason I went to this one is because they were able to offer me the best deal. I made a final verbal offer to them over the phone right before we went in to purchase. Then when we got to the dealership, the verbal offer immediately became a "misunderstanding" and the price went up $300 to the lowest email price we had. I was about to walk out, but it had been a long day and I was ready to get it over with. The dealership also lied to me several months before regarding the graduate incentive and financing rates when we were looking at cars. I guess those should have been red flags.
My research leads me to believe I can return the car to the dealership (I am sure they want a car with nearly 2,000 miles on it). I am seriously considering doing that now, and purchasing the car from another dealership in cash (I have the cash to do that, unknown to the dealership). Is this a bad idea? Is the dealership playing games with me? I can only imagine I will get a call in several days with them trying to get me to sign a loan with a higher interest rate for the car.
Cliff Notes:
Fiancee Bought a new Honda with Honda Financial Services
A week later dealership says she was not approved due to a recent voided car loan on her credit report that had not been removed
I co-signed on the loan
A month later I get a letter from the dealership saying I have been denied financing
Both have upper level professional salaries and 700+ credit scores with short, but no negative history
Is the dealership playing games? Can I return the car (now a month and a half old and 2k miles) and go buy one from another dealership cash? Is this the best move?
Last edited by Tennisjon2002; 12-20-2013 at 06:56 PM.
12-20-2013, 07:21 PM
#3
Burning Brakes
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Two primary reasons we financed were $500 flex cash from Honda finance and $500 graduate incentive from Honda Finance (must have graduated in last 2 years, which as of last week no longer eligible for). So that is $1,000 bonus for financing on top of a very low interest rate. I can only imagine the dealership would not honor that $1,000 if I paid cash. That being said now that it is the end of the year and Honda rolled out some unexpectedly high dealer incentives I could probably get a similar deal with cash payment in the next week or so. If this dealer is attempting to screw me I would rather return the favor and give them back a 2,000 mile car and buy elsewhere.
12-20-2013, 08:57 PM
#4
Senior Moderator
So wait, they let you drive away in their car without you signing a contract saying you would pay exact details? Or you signed something saying there was an approval procee that may result in worse terms and you were bound to their decision?
Something isn't adding up. If they agreed to the terms of the loan, tell them to fuck off. If you have not commited to anything, give them their car back. If you gave them a clause to fuck you, you're an idiot (no offense).
Something isn't adding up. If they agreed to the terms of the loan, tell them to fuck off. If you have not commited to anything, give them their car back. If you gave them a clause to fuck you, you're an idiot (no offense).
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12-20-2013, 09:49 PM
#5
Burning Brakes
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So wait, they let you drive away in their car without you signing a contract saying you would pay exact details? Or you signed something saying there was an approval procee that may result in worse terms and you were bound to their decision?
Something isn't adding up. If they agreed to the terms of the loan, tell them to fuck off. If you have not commited to anything, give them their car back. If you gave them a clause to fuck you, you're an idiot (no offense).
Something isn't adding up. If they agreed to the terms of the loan, tell them to fuck off. If you have not commited to anything, give them their car back. If you gave them a clause to fuck you, you're an idiot (no offense).
Contract states sale is final pending approval of agreed upon financing. Also rereading it, it sounds like I can return the car because they were not able to secure the agreed upon financing. I am just not sure how it takes them a month to deny it?
This is the first time I have financed a car, in the past the vehicle purchases I have been involved in have been cash.
12-20-2013, 11:26 PM
#6
Burning Brakes
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Looks like NC state law only gives the dealership 96 hours to finalize the financing:
http://www.ncdoj.gov/News-and-Alerts...-car-home.aspx
Problems arise when dealers wait too long to let the buyer know about problems with their financing. State law gives the dealer 96 hours to work out the financing. But we’ve heard from consumers who’ve been told their financing has fallen through more than a month after the sale, long after they’ve gotten their own insurance and tags for the vehicle. If the buyer refuses to agree to new, usually less-favorable terms for financing, the dealer threatens to take back the vehicle.
http://www.ncdoj.gov/News-and-Alerts...-car-home.aspx
Problems arise when dealers wait too long to let the buyer know about problems with their financing. State law gives the dealer 96 hours to work out the financing. But we’ve heard from consumers who’ve been told their financing has fallen through more than a month after the sale, long after they’ve gotten their own insurance and tags for the vehicle. If the buyer refuses to agree to new, usually less-favorable terms for financing, the dealer threatens to take back the vehicle.
12-21-2013, 08:27 AM
#7
Senior Moderator
You got ripped. This is a fairly common ploy to force people into a loan with higher interest after the sale. I have financed many cars and have thankfully never run into this. I have a friend who went through this nightmare, though.
Ask the dealer for the ACTUAL letter denying you credit. If they can't, tell them to frack off. If they can.....you may have to return the car. Worse, they may charge you mileage. Worst case, you may have to get a lawyer involved.
You can also take the risk of going back to the dealer.....in a car different from the one you purchased so they don't try to take possession.
Lastly: you made the error of cosigning. Bad move. Your lady should have brought a copy of the loan cancellation to the dealer as proof in addition to having the other company fax it.....just in case the dealer was shady and denied receiving said fax.
Count this as a life lesson learned. I'm not trying to be harsh, I've made a horrible financial decision or five in my time....
Good luck!
Ask the dealer for the ACTUAL letter denying you credit. If they can't, tell them to frack off. If they can.....you may have to return the car. Worse, they may charge you mileage. Worst case, you may have to get a lawyer involved.
You can also take the risk of going back to the dealer.....in a car different from the one you purchased so they don't try to take possession.
Lastly: you made the error of cosigning. Bad move. Your lady should have brought a copy of the loan cancellation to the dealer as proof in addition to having the other company fax it.....just in case the dealer was shady and denied receiving said fax.
Count this as a life lesson learned. I'm not trying to be harsh, I've made a horrible financial decision or five in my time....
Good luck!
Last edited by neuronbob; 12-21-2013 at 08:35 AM.
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12-21-2013, 11:34 AM
#8
Stage 1 Audi S5
That sounds terrible, I did the grad program on a TL and it was great (zero percent plus incentives).
It sounds like you have pulled your credits so what does her's read in reference to the first loan? Something isn't adding up here and/or you did indeed get a shady dealer. I can't imagine they are going to take the car back and not charge you a ton in fees, especially with that mileage.
Sounds like you may need to get a lawyer soon
It sounds like you have pulled your credits so what does her's read in reference to the first loan? Something isn't adding up here and/or you did indeed get a shady dealer. I can't imagine they are going to take the car back and not charge you a ton in fees, especially with that mileage.
Sounds like you may need to get a lawyer soon
12-21-2013, 11:43 AM
#9
Burning Brakes
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You got ripped. This is a fairly common ploy to force people into a loan with higher interest after the sale. I have financed many cars and have thankfully never run into this. I have a friend who went through this nightmare, though.
Ask the dealer for the ACTUAL letter denying you credit. If they can't, tell them to frack off. If they can.....you may have to return the car. Worse, they may charge you mileage. Worst case, you may have to get a lawyer involved.
You can also take the risk of going back to the dealer.....in a car different from the one you purchased so they don't try to take possession.
Lastly: you made the error of cosigning. Bad move. Your lady should have brought a copy of the loan cancellation to the dealer as proof in addition to having the other company fax it.....just in case the dealer was shady and denied receiving said fax.
Count this as a life lesson learned. I'm not trying to be harsh, I've made a horrible financial decision or five in my time....
Good luck!
Ask the dealer for the ACTUAL letter denying you credit. If they can't, tell them to frack off. If they can.....you may have to return the car. Worse, they may charge you mileage. Worst case, you may have to get a lawyer involved.
You can also take the risk of going back to the dealer.....in a car different from the one you purchased so they don't try to take possession.
Lastly: you made the error of cosigning. Bad move. Your lady should have brought a copy of the loan cancellation to the dealer as proof in addition to having the other company fax it.....just in case the dealer was shady and denied receiving said fax.
Count this as a life lesson learned. I'm not trying to be harsh, I've made a horrible financial decision or five in my time....
Good luck!
) The cosigning was not a big deal to me, I considered doing it before all this happened anyways and I was trying to give them the benefit of the doubt.
Does anyone know if they can charge mileage etc in NC if it is returned. The contract states nothing about mileage, just says the car must be returned with normal wear and tear, which I would say is mileage.
Also if there were financing issues would I be able to register and title the car? Taxes have been payed and registration has already been received.
Thanks!
12-21-2013, 11:54 AM
#10
Burning Brakes
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Also I point worth mentioning, I have not paid a penny to the dealership. The down payment was completely paid for by Honda Finance with incentives. The first payment is not due until February.
12-21-2013, 12:34 PM
#11
Three Wheelin'
The car you currently have is from honda dealership right? My nephew bought a new honda civic, they let him drove it off the lot, he couldn't find anyone to co-sign it and honda wants it back. so 3 weeks later he returns the car with 400 miles added to the car and honda not only game my nephew his $500 down payment back, but they didn't charge him for mileage. So i don't know why honda would charge you extra for that 2000 miles.
12-21-2013, 01:11 PM
#12
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The financing was through Honda Financial Services (for the Grad incentive etc) should I call them and see if they approved the loan or not?
And I checked both of our credits, neither are showing any auto loans right now.
And I checked both of our credits, neither are showing any auto loans right now.
12-21-2013, 04:46 PM
#13
Senior Moderator
I'd suggest calling honda financial services and talk with them before your car ends up getting repossesed and your credit gets hurt!
12-21-2013, 07:59 PM
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I would call up the financial institution to get to the bottom of it.
12-22-2013, 10:31 PM
#15
Senior Moderator
Listen to Shoofin 
, he's a dealer/broker, and knows more about this stuff than any of us.
The financing and registration are separate issues and have no bearing on one another. As apfar as NC and paying mileage on a car that must be returned, not sure legally but in the situation I know of, the dealers tried to collect for mileage. It ultimately took a lawyer to sort it all out.
, he's a dealer/broker, and knows more about this stuff than any of us.Thanks for the help and advice. I think the dealership is pissed that they really didn't make money on the sale. I got a good price on the car and didn't buy any extras such as warranty, paint protection etc. The finance manager was pissed when he came in during the sale and found out we weren't buying extras. So now they think that since I am young they can play games. I am going to talk to the attorney generals office Monday and then may go by the dealership at lunch Monday (in a different car of course )
The cosigning was not a big deal to me, I considered doing it before all this happened anyways and I was trying to give them the benefit of the doubt.
Does anyone know if they can charge mileage etc in NC if it is returned. The contract states nothing about mileage, just says the car must be returned with normal wear and tear, which I would say is mileage.
Also if there were financing issues would I be able to register and title the car? Taxes have been payed and registration has already been received.
Thanks!
) The cosigning was not a big deal to me, I considered doing it before all this happened anyways and I was trying to give them the benefit of the doubt.
Does anyone know if they can charge mileage etc in NC if it is returned. The contract states nothing about mileage, just says the car must be returned with normal wear and tear, which I would say is mileage.
Also if there were financing issues would I be able to register and title the car? Taxes have been payed and registration has already been received.
Thanks!
Last edited by neuronbob; 12-22-2013 at 10:36 PM.
12-23-2013, 09:26 AM
#16
Burning Brakes
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Listen to Shoofin , he's a dealer/broker, and knows more about this stuff than any of us.
The financing and registration are separate issues and have no bearing on one another. As apfar as NC and paying mileage on a car that must be returned, not sure legally but in the situation I know of, the dealers tried to collect for mileage. It ultimately took a lawyer to sort it all out.
, he's a dealer/broker, and knows more about this stuff than any of us.The financing and registration are separate issues and have no bearing on one another. As apfar as NC and paying mileage on a car that must be returned, not sure legally but in the situation I know of, the dealers tried to collect for mileage. It ultimately took a lawyer to sort it all out.
He actually helped me out 8 years ago on a car purchase, its like deja vu. Anyways, I called Honda Financial Services this morning and... Loan was approved, everything is good. I called finance guy at dealership and left him a message to call me.... I will keep you updated....
12-23-2013, 11:26 AM
#17
Senior Moderator
Awesome. Then you're done. Perhaps dealer was just slow in realizing that this happened. Paperwork lost, etc.? That happens sometimes. Hopefully they really weren't trying to jerk you around.
12-25-2013, 09:03 PM
#18
Punk Rocker
Just saw that you resolved the issue but was about to say screw em and return the car. You're not technically on the hook for anything considering they couldn't get you approved after the fact. Again, I saw that they did approve though so cool beans!
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