The "Spot Delivery" - a Disaster Waiting to Happen!

The "Spot Delivery" in a car dealership is a tactic many car dealers use to get the customer down the road in their new car as soon as the deal is agreed upon so the customer doesn't have a chance to change their minds. If given enough time many customers will have second thoughts about a car deal.

The "Spot Delivery" is a bad practice that causes lots of grief for car buyers and dealers alike. Most often it's done before the financing is approved and this is where the trouble starts.

The Finance Manager in the car dealership has to be able to make an educated guess based on a person's credit report and their credit application as to where they can get them financed and at what rate. They may not be able to actually get the deal approved by the bank for one to three days.

So they make their best guess, print out all the corresponding paperwork and get the customer to sign everything just like the loan is approved. In fact, the customer is led to believe that the loan is indeed approved and their deal is done. This is done so the customer thinks in his or her mind that they have bought and financed a car. Thinking this they will not consider backing out of the deal when they come to their senses!

Now if the bank approves the deal as the Finance Manager structured it everything is fine. The dealership processes the paperwork and the deal is done. What happens however, if the bank won't approve the deal? And this happens very often.

Remember, the customer is under the impression that their loan has been approved. If the bank won't approve the loan the best case scenario is that the Finance Manager gets the deal approved somewhere else and has to call the customer back in to sign a whole new batch of paperwork. Probably the interest rate and the payment will be higher, maybe even the down payment goes up.

If the Finance Manager is slick enough he or she can get the customer to go along with the new terms and everybody is happy.

The worst case scenario is that the customer is told the dealership can't get them financed and they have to bring the car back! If the customer refuses the dealership will go and get the car. If the customer traded a vehicle it may or may not have been sold by the dealership, so that opens up a whole new can of worms.

I get emails all the time from people who go through this stuff. I usually tell them to file a complaint with their state's Attorney General's office and to get a lawyer.

If you ever find yourself buying a car in a dealership and they are trying to hustle you down the road in the car ask for written proof that the loan has been officially approved. If they can't or won't provide you with this proof then don't take the car until it is proven to you that the financing is approved.

If you don't, and sucumb to the temptation of taking the vehicle before it's a done deal it could be your driveway that the tow truck backs into to take your car back.

To avoid this whole mess you should arrange your own financing before you go to buy a car. One excellent source to get a pre-approved car loan is Capitol One Auto Finance. They will give you a Blank Check to go car shopping with thereby avoiding the "Spot Delivery" trap.