Auto Loans With No Credit

What to Look Out For When Financing a New or Used Car

When purchasing a used or new vehicle, there are a lot of things to look out for.  Customers with less-than-perfect credit may be tempted to sign the dotted line at the first dealership willing to loan them money, and end up agreeing to things they never intended to.  To make matters worse, the Federal Trade Commission’s (FTC) “cooling-off” period mandated for some consumer products do not apply to automobile sales.

Here are the most common ways shady used-car dealerships can end up charging you far more than you anticipated or agreed to.

  • Price. There’s a reason your dad always told you to read the fine print; that’s where they change things at the last minute. If you check the final sales price of the car you’re buying and it’s different than what you agreed to, ask why.  Dealerships are allowed to charge sales tax, licensing fees, and sometimes documentation fees.  Any other charges may be fraudulent and should be challenged.
  • Term. The amount of time you agree to pay back the money you borrow should be the same number of months you agreed to in negotiations.
  • Interest. How much it costs you to borrow money will definitely affect the sales price, and if the interest rate on the contract is different than what the salesman told you, it’s a huge red flag.

Although there are other areas to check the fine print on, these are the most common ones where discrepancies occur. Remember, because you are probably a first-time buyer in need of a no credit auto loan, you are at significantly greater risk of being “duped” than an experienced shoppers, simply because dealers could see you as easy prey.