Below is a letter I received from one of my web site visitors. Had he been exposed to this web site a bit sooner he may have been able to save himself a lot of unnecessary grief!

His story is so typical of the way SOME . . . and I emphasize "SOME" . . . car dealers operate. Please, learn from his experience so this doesn't happen to you.

This is what he wrote to me:

"Here's a story I thought you'd find interesting.

"I went car shopping recently, and like a dummy I didn't follow any of your advise! I won't make that mistake again.

"I went into this dealership and they had a used 99 Ford Taurus I wanted. I have a 90 Olds Ciera to trade that I owed $2,000 on.

"The salesman told me he would give me $3,500 for my trade and I could buy the Taurus for $300 a month.

"It sounded like about what I was looking for so I said OK. The next thing I knew he wanted a deposit from me to make the deal official. I told him I was using my car as a down payment, and I didn't want to put any cash down. The salesman told me that if I didn't give him some money as a 'good faith deposit' that the deal was off!

"I should have left right then, but I said OK. I gave him a check for $100 and the salesman told me he would just hold it until I picked the car up then he would give my check back to me.

"Before I left I had to see the Finance guy. He told me I needed all kinds of insurance on the loan, like life and hospitalization and he said I needed a warranty. He made it sound like the bank wouldn't finance me without all this stuff on the loan. He said the payment would only go up a little bit, so I said OK. I was supposed to pick the car up the next day.

"Well, I showed up the next day to pick up my car. The salesman was real friendly and running around getting my license plates switched over and everything.

"After waiting an hour to sign the papers I finally got into the Finance Office. The Finance guy had a whole stack of papers ready for me to sign. Well, the first thing I noticed was that the payment was now $413 a month! If this wasn't bad enough, this finance guy said I needed $3,000 cash down!

"I said 'wait a minute. You're giving me $3,500 for my trade and that's my down payment.' This guy told me that the $3,000 cash down was in addition to my trade, and my payment was $413 a month!

"I went nuts! I said 'you guys are trying to stick it to me. How could my payment possibly be $413 especially since you're figuring it with an extra $3,000 down?' He said to me he had nothing to do with it, that the bank was making the call. I said try another bank, and he said he already did and this was the best deal he could get for me!

"I said 'forget the whole thing. You guys are screwing me and I'm not standing for it.' I said 'give me back my $100 check and I'm gone!'

"This jerk said he couldn't give it back, because they had already deposited it. I couldn't believe this. I said the salesman told me the check was just for 'good will' and I would get it back when I picked up the car.

"He called the salesman in and he said I must have misunderstood him, that he never said I could get the check back. I know what this guy told me. He was flat out lying to me. I said 'I want to see the manager!'

"The manager came in and I told him I wanted my $100 back so I could leave. He asked me what the trouble was, so I explained to him the whole mess, and he said the salesman wouldn't have told me that about the check because it's not their policy to do that.

"I was ready to scream. Then the sales manager asked me if I would take the car if he could get my payment a little lower. I said 'if you can get my payment lower why didn't you just give me a lower payment from the start?' He said it looked to him like there was a mistake in the numbers. He went back to his office and re-did the numbers and came back and said if I put $2,500 down plus my car he could get the payment down to $393 a month!

"I said 'give me my $100 back so I can leave.' Then he said 'what if I can do the $393 a month with only $2,000 cash down?' I was starting to feel like a ball in a pin ball machine!

"'I said our deal was $300 a month with just my trade down, and the Finance guy said it might be a little higher for the insurance and warranty.' The manager said no, I must have misunderstood.

"I guess I misunderstood everybody in the dealership. Maybe I speak a different language then they do!

"I finally got so mad I just got up and left. When I got outside my car was nowhere to be found. The salesman said he had no idea where my car was. All of a sudden he wanted nothing to do with me.

"I removed my plates from the Taurus using a coin, and started searching for my car. I finally found it in the clean-up dept. and they were already cleaning it up! I drove my car out of there with soap still on it, and as I was pulling out I could see a couple of salesmen laughing at me!

"It took me over a week of calling the owner and the Better Business Bureau to finally get my $100 back.

"I'll never go near that place again. No wonder so many people are afraid to go into car dealers."

John, Boca Raton, FL

Well!

Let's see what happened to poor John here. First of all, NEVER negotiate a car deal on payment! When you do you will get screwed every time!

All John knew was that his payment was going to be a "little higher" than $300 a month. He had no idea what selling price they were using or what loan term they were using.

You can be sure the Finance Manager was figuring at least 66 months, and maybe even 72 months! John had no idea what interest rate the guy was using either.

And by the way, that baloney about the manager acting like he had just found out what was going on was all bull. I guarantee you that he was the one orchestrating the whole deal from behind the scenes.

And that excuse about a mistake in the numbers so that he had a way to drop the payment was all bull too! That is a very typical tactic that's routinely used by managers.

The best thing John could have done was to go in the dealership and negotiate a selling price on the car without a trade.

He should also have arranged financing before shopping, either through a local bank, a credit union or online. There are some very favorable finance rates available online. Go here For a FREE Finance Quote and Some Great Finance Tips!

I also doubt John's car was worth $3500. They were probably just giving him an inflated number on paper to make it look good.

Let's look at the way the numbers should have been:

Using an average interest rate of 9.18% (average at the time of this writing) which you can easily get online, his payment for 66 months should have been $287.50!!

Now, were they sticking it to poor John or what?!

Here are some points to remember...

• Always negotiate a sale price without a trade. Don't negotiate payment. After you have agreed, in writing, on a firm selling price then and only then tell them you have a trade. This will back them into a corner and it will also force them to tell you the real value of your trade.
• Arrange financing before you go in to make a deal. Here are some excellent finance sources you can get Free quotes from!
• Don't give the dealer any deposit unless they give you a written receipt on which it states that your deposit will be promptly returned to you if the deal falls through.
• Banks cannot force you to take credit insurance or a warranty as a condition of getting a loan. So don't let any Finance Manager lead you to believe otherwise.

• When you make a car deal always get it in writing signed by the sales manager.

Thanks for sharing your experience with us John. Better luck next time.