Car scams are rampant with all the shortages going on. Purchasing a new or used vehicle has become more difficult in recent years. Whether it is the in-person shopping limitations brought on by the pandemic, supply-chain disruptions that have limited the production of new vehicles, or the shortage of available used vehicles, Kansans have had to endure a great deal just to find reliable transportation.
Attorney General Derek Shmidt warns us of these classic dealership scams.
Yo-yo scams: A yo-yo scam occurs when a consumer is led to believe, through acts or omissions by a car dealer providing financing, that the loan financing is final when in fact the dealer has not actually finalized the vehicle financing. The dealer allows the consumer to drive off the lot with the car “on the spot,” which is called a “spot delivery” in the auto sales industry. The dealer knows the consumer has not qualified for financing, and sometimes the dealer knows the consumer is not going to qualify. When the financing falls through, the dealer pulls the consumer back to the dealership like a yo-yo on a string. Sometimes the dealer presents a new deal to the consumer to allow them to keep their car – one with a higher interest rate or larger down payment. The frequent excuse is “the lender” has disapproved the application or has changed its mind. Consumers can protect themselves by comparing financing offers from several lenders before shopping for a vehicle, and securing…
