Car Dealer Fees - Was I Fooled by the Dealer??

by Jithu
(Vernon Hills)

Question: I have a question regarding car dealer fees and my recent car purchase. I am new to this country and hence I don't have any credit history.

I bought a car putting 50% as down payment and my relative who had 751 FICO score co-signed for me. The dealer made my relative as the main buyer and I as the co-buyer.

He charged an extra 500 dollars stating that I had Tier 4 Credit and and my relative had Tier 1 Credit and otherwise my interest rate for the finance would shoot up.

So is this additional fee actually charged or was I fooled??? Somebody please advise me. Thanks in advance.

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Answer: Hi Jithu,

It sounds to me like you were lied to and I can see no reason to add that $500 to the sale price other than the dealer making more money.

Even if you were approved by a lender that was charging the car dealer fees of $500 all lenders that I have worked with specifically state that that fee cannot be passed on to the customer.

Your relative has a good credit score and I'm assuming a strong credit history and I just don't see why the dealer would have to send your loan to a lender that would charge a fee.

What lender did they get you financed with?

Assuming you have a social security number, but no credit, I'd think that you would have been able to get financed with a credit union since you have a strong co signer and a very attractive down payment. Credit unions don't charge fees for loans (at least not the ones I've worked over the years).

If you have a print out of what the vehicle was listed for sale on their website, that may help you get that $500 back. If they are not willing to do this, then you could look to your states Attorney General or the Motor Vehicle Department for further help.

Hope this helps,

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