The lots are brighter than a baseball field, surrounded by happy blow-up figures that smile and wave in the wind. With free hot dogs and soda on some Saturdays and commercials with blue jumpy genies, they seem like the happiest place on Earth. But they're car dealers. And happy is not the most apt word to describe such places. There are dark tales that lurk on these lots. Tales of buyers who feel like they've been held hostage. Tales of deals gone smoothly, only to be recanted by the dealer within a matter of days. Tales of four-, six-, eight-hour waits that could inspire nothing less than the dreaded road rage. If you've bought a car, or know someone who's bought a car, or are simply aware of the professional field that, to some, exists right above trial lawyers on the list of reviled, you've heard such stories.
Aside from a house, a car is typically the most expensive item a person will purchase. But memories of home-buying somehow come across more positively than vehicle purchase experiences. Even speaking with car dealers for this story brings back memories of the pressure, the guilt they slather, and the frustration. One dealer warned that I better cross all I's and dot all my T's (whatever that means) or that I might find myself in trouble. He then asked if our paper sold ads and requested that I send a sales guy down his way.
GLOSSARY |
T.O.: Turnover. A deal is turned over to another salesman because of a personality conflict or some other reason. Up: Name for a customer. "There's an up on the lot." Be-back: When a customer who's left actually returns. "There's a be-back on the lot." Laydown: Someone who's willing to pay the list price for the car. Rare. Roach: A customers with bad credit. Get-Me-Done: When somebody has shaky credit, but it might still be possible to "get him done." Bump: The salesman returns to the customer, after talking with the manager, and bumps the price. Lowball: A customer who's clearly not going to make a deal that night asks for best price on a vehicle. The sales manager gives him an unrealistic one so he'll get laughed out of other dealerships if he shares it with them. When the guy returns to the lowballer, he'll get a price much higher than he was originally quoted. Upside-down: Owing more than what a car's worth. Croak-and-choke: Credit life and disability insurance. Spot delivery: Pushing to get the customer on the road that day so they think they bought a car, even though financing hasn't gone through. Loaded payment: If the salesman can get the customer to negotiate on a monthly payment, rather than an actual price for a vehicle. Buyers are Liars: Car-salesman phrase. They dislike us as much as we dislike them. |
Ron Nelson has a story about car sales that doesn't exactly cross into illegal territory. But it's an experience that sounds creepier than than your typical business practice. Nelson bought a vehicle from Findlay Toyota on a Saturday. He signed the contract and wrote a check for a large down payment. Findlay reps told him he couldn't take the car that day because it had just arrived on the lot and wasn't ready to leave. But he could return on Monday to pick it up.
Using poor judgment, Nelson left the dealership and continued shopping at others. He found a vehicle somewhere else he liked better than the one he'd just purchased. Because he'd recently moved here from Washington state, Nelson assumed that Nevada also has a three-day rescission law, and that he could simply call Findlay on Monday morning and tell them he'd changed his mind. Having not even driven the car off the lot, he expected no problems. But Nevada doesn't have a rescission law (at least, not for the buyer's protection) and Nelson found himself in a bit of a quandary—Findlay wasn't budging. It considered the car sold. So he put a stop on the down-payment check.
Later that day, he received a phone call from a friend with whom he's staying: The car dealership delivered the vehicle. It's sitting in the middle of the driveway. "I was just dumbfounded. I couldn't believe it," Nelson says. "Isn't that psycho?" So Nelson had a friend drive the vehicle over to Findlay (he figured it would be better so they could never say that he was in possession of the car), and he walked the keys in and dropped them on the manager's desk.
The manager, knowing that Nelson had purchased another vehicle similar to this one, wasn't thrilled. "He brought it back and I explained to him that if he brought the vehicle back, it would be looked at as an abandoned vehicle on this lot and we could have one of two things done," says sales manager Odis Allison. "We could return the vehicle, or we will have it towed and then he would incur some more financial responsibility with the tow and the storage of the vehicle. We delivered the vehicle back to the house."
And there it was the next morning, parked in the street with the keys locked inside.
"I know that every time I take it over there that they will just bring it back," Nelson says. "They are going to force me to take possession of this vehicle." Now he has two vehicles and he's facing a felony if he doesn't repay the down payment check he put a stop on. The most viable option, he says, is to sell the one from Findlay and hope to at least recover what he paid for it.
"We stand firm in our belief that we did all the things right, and we were positive in terms of our car sales, we were positive with him as a customer," Allison says. "It was Mr. Nelson that had the issues." Allison adds that in most situations, they try and help the customer out. But because Nelson bought a different vehicle and then came to them threatening to go to the media and file a lawsuit, the dealership stood firm.
It's not unusual, says one former car salesman, for a car salesman to hold your keys after assessing your trade-in value, or your driver's license after a test drive, or a deposit, all in an effort to keep you in the office until you buy a car. But those tactics, which make the customer/victim feel hostage, aren't illegal—they're just annoying. And complaints on such behaviors aren't lodged with the Nevada Bureau of Consumer Protection, or the Nevada Consumer Affairs Division, or even with the DMV. When asked what the main complaint is, Kevin Malone, spokesman for the DMV, is befuddled. "I would say the most common complaint we get—oh heck, that's a good question, because there's two or three of them." He narrows the list down to mechanical issues with used cars, which are sold as-is.
Then there are so-called "yo-yo sales," which are typically a result of the dealer's right of rescission. Say you buy a car, and the dealer gives you a nice, 5-percent interest rate. The dealer then has 15 days to call back and change the deal. Say he couldn't get approval for your financing at that rate. He'll then bump it up higher, say to 15 percent. Malone, along with Clark County Legal Services and Assemblywoman Barbara Buckley, are looking into legislation to address sales practices, to ensure in the yo-yo sales that customers get back their full down payment and trade-in. As it is now, says Dan Wulz, director of Clark County Legal Services, some of the dealers represent to customers that they must accept the higher interest rate and the new contract when that's simply not the case.
Tony Iorio speaks the salesmen language. After being in the business for more than 20 years, he knows a customer is called an "up" and that each is met with psychological warfare to get them to buy a car. Iorio has worked in dealerships in Missouri and Ohio as a salesman, a sales manager and in the finance department. Since he left the business, he began the website www.insidercarsecrets.com to help prepare the public for the car-buying experience. Here's what advice and revelations he provided in a recent phone call.
Immediacy. "The dealership's goal is to turn everybody that walks through that door into a Today buyer. Because they know if somebody walks out of that dealership without making a deal, chances are they're going to go to another dealership and they're going to keep going to dealership after dealership until they run into another salesman that takes control of them essentially and gets them in a car."
Beware. "Most of the scams are centered around the finance office, because there's so many shenanigans that go on with car dealers trying to get loans approved for customers."
Research. "If you go in there unprepared, the salesman's going to get you off the sale price, he's going to get you a price difference, he's going to find out if you're trading, he's going to find out how much money you want to spend a month. And each time they get you off the sale price, it's going to cost you more and more." Go to the car lot and write down everything that's on the window sticker. Then go home and look up the invoice price and each added option, so you're prepared. Offer $300 to $500 above the invoice price, plus tax, title and license fees.
Bankrolling. "If you let the dealership handle the car loan, the dealership might be making an extra $2,000 to $3,000 in what they call reserve, which is just profit." Have financing secured before entering the dealership. Go to your bank or credit union.
Read the fine print. Dealers are notorious for slipping in extended warranties, life and disability credit insurance without telling you. Take your time and read the contract.
Say no. They're also notorious for throwing in additions like pinstripes or tinted windows and marking up the prices astronomically. You can always tell them to find you a car with out these cosmetic advances.
You are not powerless. If you don't like the deal or how you're being treated, you can always walk out. Just make sure you keep your keys and drivers license nearby.