Just bought a $37,000 car at Leith Honda today. Although I love the car, it sure was reinforced to me today that car dealers will take you to the cleaners for every dime they can scam out of you if you don't see it coming, and Leith Honda is no different. Here are just a few specific tricks they actually tried on me today. Hopefully you will learn from my actual experience:
1) We agreed on a price, then start the paperwork. Well into the signing process, they ask me to sign a document agreeing to more cost for some "extra" dealer additions that they added to the car, but didn't mention to me earlier. In my case, it added up to $350 for mudflaps. When I objected, they said "oh but that's normal. We always charge for these things we added, what's the problem with that?" I looked around the lot, and every single car like mine had these additions, but the additions were never listed on the sticker. So it's apparent to me that this scam gets run with every customer.
2) When I made my offer, I made it in writing via email, with a statement that says "this offer includes ABSOLUTELY ALL fees". And they agreed to that, in response to my email. However, at a point well into the paperwork, they nonchalantly ask me to sign something that adds a $400 "dealer fee". Again, I noticed and objected, and again they said "Oh that's a normal dealer fee, we charge everybody that." Completely ignoring the fact that we had agreed on a price with no further fees.
3) They "miscalculated" the registration fee, also known as tax, tags, and registration. This is a legitimate fee that the government charges. In my case, after I objected to the $400 "dealer fee" (#2 above), and we argued about it, he begrudgingly eliminated the dealer fee, then recalculated the tax, tags, and registration fee to be $127, scribbled it all on paper and said "is this better?" I found later that this charge is actually supposed to be $74. So he managed to jack up the price here by $53.
4) Once I have signed the contract, I'm sent to the finance guy. Now keep in mind, I signed the contract, I bought the car. I just need his loan to pay for it. But he immediately starts telling me what a crappy car this is. It's got SO many electronics, there's SO many things that can go wrong. And his experience is that after about 2 or 3 years, things will start falling apart. (And I'm thinking wait - you just sold me this brand new car you're describing as a pile of crap?) And he magically shows me how my factory warranty is not even going to last 2 years given the mileage I'll put on it. And then the sales pitch: I need to spend several thousand extra dollars on an extended warranty, which he can conveniently roll into my loan adding only a few dollars a month to the payment. Yet in reality - this adds thousands of dollars to my purchase price. (If you want to check out the actual usefulness of an extended warranty on a brand new Honda, then Google it. It's useless.)
5) After the finance guy berates me for not buying the extended warranty, he tells me about gap insurance. I'll let you google gap insurance, but the thing I'll say is that he implies that your insurance company will not cover the gap between a totaled car and your car loan. But in fact, my car insurance company does actually cover gap insurance - I asked before I went to the dealer. But he would have been glad to push on me this insurance that I already have, thus increasing my purchase price yet again.
6) And finally, the finance guy "miscalculated" my loan amount through Honda Finance to be higher than I had actually agreed to pay for the car. I didn't notice this at first, until he asked me to sign a new version of the sales contract with the price increased to match the higher finance amount, after the loan had been completed.
So those are just 6 actual examples of what happened to me today while buying my car at Leith Honda. This process took me about 6 hours. Bottom line is, from the second you walk in the door to the second you walk out, they will be trying to add on to your purchase price without you even knowing it, using the methods above and more. Buyer beware, do your research. read more