Reading the Fine Print Critical in Used Car Ads

Hundreds of buyers at one used car dealership thought they were in on the opportunity of a lifetime when they responded to an advertising promotion offering $65 worth of gas with the purchase of a car.

And it does sound like a great deal'”right?

Well, before racing over to the lot to take advantage of it, those customers would have done well to take the time to read the ad a bit more carefully. In this case, they should've read more carefully to find the one key word missing from the promotion.

Free.

Nowhere did the ad say buyers would get $65 worth of gas free. When they bought a used car during the promotion, they got a gas voucher from the dealer for $65. The price of which was then promptly added to the purchase price of the car.

Moves like this one designed to get you into a dealership are common. So common, we've all heard of most of them. Remarkably though, they still work despite this broad awareness.

There's the one where they guarantee you something like a minimum of $3000 for your used car trade-in, whether it's running or not. This one is often a TV ad showing some smoking 15-year old hulk being towed in'”presumably to be offered as a trade on any car on the lot'”for the guaranteed $3000. If you could read the miniscule font scrolling across the screen at 275 miles per hour at the end of the ad, you'd typically find the amount of cash credited to the buyer over the actual value of the trade-in is rolled into the price of the car purchased. So, let's say that smoking hulk you had towed in is worth $250. Taking this deal, you just agreed to pay $2750 more for the car you're buying (plus the price of the tow). You'd have been better off selling the hulk to a scrap yard.

Another oft-employed promotion is the 'special financing' deal. This one goes something along the lines of; 'This weekend only, take any car on the lot at 0.1% interest.' However, when you read the little tiny letters at the very bottom of this ad, you'll see language to the effect of; 'Offer available to qualified buyers only'. In this scenario, 'qualified buyer' typically means someone with an absolutely pristine credit history. That mythic individual scoring well above the highly coveted 750. Now realize, if yours is anything below that (most people do score lower than 750) it's not a problem. In fact, you're the exact buyer they hoped would respond. Don't be embarrassed they'll tell you. You'll still qualify for a loan. You just won't get to take advantage of the delicious interest rate that enticed you to this particular lot in the first place. Even better for the dealer, if you don't know your credit score and what rate it actually qualifies you for, you just might wind up paying a couple more points on the loan they 'manage to do you a favor' and qualify you for.

Another common advertisement promotes a highly popular car at an impossibly good price. Breaking out your magnifying glass, you'll see in the fine print; 'Only one available at this price.' And/or, there will be hundreds of dollars worth of extras you'll need to buy to get that car off the lot.

This tactic is called bait and switch. When a customer shows up at the lot to buy the advertised car (the bait), they're told it was 'just sold'. Not to worry though, there's a very similar one 'that just came in' for only a little bit more money (the switch).

This one is so common, a recent review of car ads by the New York City Department of Consumer Affairs found examples of bait and switch ads in every major New York City newspaper featuring car advertisements. A full 90 percent of the used car dealerships advertising were found to employ some aspect of this tactic. More than half of these dealerships were found to be advertising cars after they had 'already been sold'.

Now here, we hasten to add not every used car dealer is a plaid sport coat-wearing shyster out to rob you blind. However, in a market-driven society like ours, the Latin phrase caveat emptor (buyer beware) is always relevant.

The takeaway?

Do your homework, read those ads carefully'”for what they don't say, just as much as what they do say. And, if you find somebody trying to pull a fast one on you, report them immediately to your local Department of Consumer Affairs.