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Tips on Buying Cars/Dealership had my lie to finance company


I bought my car and agreed to pay $500 down, which I did.  However, the dealer told the finance company I paid $1600 down and told me when the finance company asks, just say I paid the $1600.  Now, the dealership is trying to hit me for the additional $1100.  I don't recall signing anything that said I would pay them the additional amount, I'd explained all I had to put down was $500 SEVERAL times.  My dealer tags are going to expire in June and now I'm being told they will hold my plates & tags until it's paid.  What can I do??!

Hi Susan,

As luck would have it I was sitting here in my office with 2 of my managers and 2 bank reps (from a bank that finances our car loans) when your question came in I threw it out to the panel and we are all in agreement on the answers:

1. They can NOT legally hold your plates for non payment of what we call a "pickie" payment ...and thats even assuming that you are required to pay it ...which as you will see you aren't.

2. Hang with me on this next part ...

 a) The contract between you and the dealer is the document called the "Purchase Order" ... the contract between you and the bank is called the "Retail Installment Contract (it's the long form usually)...take that info and put it to the side for a second.
 b) Banks hate pickie payments like the plague ... because they put the customer in a position (usually) of having to decide whether to pay their first payment to the bank or pay the rest of the down to the dealer AND if the bank knew that you didn't have the entire amount down when you signed up they may not have done the deal at all.
 c) When a dealer takes a pick payment from a customer he usually will have them sign a "P-Note" (promissory note) so dig thru your paperwork and make sure you didn't accidently sign one. Odds are you may have ...but the good news is that while it would give the dealer something to wave in the air in small claims court he isn't likely to do it because his dealer agreement with the various lenders he is signed up with discourages conspiring with customers to commit bank fraud.
 d) A retail installment contract that contains terms that aren't real is not enforceable per se other words I had a deal many years ago just like yours ...the salesperson told the customer to tell the bank he had paid the entire down payment ... then 6 months later when the customer stopped making his payments his car got repoe'd and in talking with the customer the bank discovered that he didn't really put 3,000 down ...he had only put 1,000 down and never paid me the money he owed on his P-Note what the bank did when they found that out was they sent me a letter telling me what happened and instructing me that I had to buy the contract back...every cent the bank had paid me for the contract including interest ...and then they cut us off for 30 days. ...

So what that means to you is this ...Call the dealer and tell them that you did not agree to pay the extra $$ (provided you didn't sign a P-Note) and tell them they are not legally able to hold your plates in order to collect money because the plates are all paid for and if they don't cough them up then tell them your next phone call is going to be to the DMV business regulation team who is required to perform an investigation (at least in Oregon and other PNW states) DMV scares dealers more than any other entity ...Then tell them that if they don't back off on the 1100 bucks they say you owe that you are going to immediately call the bank and tell them everything they are trying to do including the part where they coached you to say that the down payment that was paid was larger than it really was... and expose the fact that they have committed bank fraud etc. and when you do this you should do it BOTH in writing via email to the dealer principle (the guy with the license who will understand the ramifications of what his mpeople have done) ... I would STOP talking to the salesman and the sales manager and go at least to the owner or General Manager of the store ...

sorry I am a bit rushed but didn't want you to panic over the long weekend personal email is and you are welcome to ask me as many follow ups as you need


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Roger Alvey


I can answer any question about the car buying process. I am a recognized industry expert on all issues regarding auto finance, including sub prime and buy here pay here financing, I can answer questions about car lock out systems, GPS monitoring by your bank, and about auto recovery methods and defenses. I am a 20 yr car industry expert and can tell you what to look for in a used car, how to negotiate the deal, help with how to market your own car, and how to negotiate with the internet department of any car store. I can tell you every single way the dealer is set up to beat you and how to avoid those traps, I can discuss all aftermarket and extended service contract products you will be offered in the finance process, I have lectured extensively on "The Best Way to Buy a Car" to civic groups and university students. I am a credit expert and can tell you what the dealer and banks are looking for and the rate you can expect to pay. HERE IS THE LINK TO MY OTHER ALLEXPERTS CATEGORIES WHERE I HAVE ANSWERED LOTS OF QUESTIONS HERE IS A LINK TO MY BLOG


20 years industry experience in top management of dealerships and dealer groups. Recognized industry expert since 2004 in the Top 10 industry experts for The Gerson Lehrman Groups Auto Industry Council. I also do consulting work for Atheneum Partners, Expert 360, Expert Connect and Coleman Research. I have been a franchise owner and understand all facets of the auto industry from the time the car leaves the factory until it leaves the lot with it's new owner. I have written training materials for both the prime and the subprime sales and finance process.

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