Vehicle Sales Contract
Stuffin' Your Car Buying
Contract Like A Turkey
Understanding your vehicle sales contract, or vehicle sales agreement, is extremely important for preventing scams in the finance office.
There is a reason that this is the last form signed in finance. They want to wear you out with signatures on all the other irrelevant forms prior to the most important one, the vehicle sales contract, in hopes that you won't pay very close attention.
This is not always the case, but I can assure you it is the case if they are going to try and pull a fast one on you.
It is so important to pay close attention to what is going on at this point of the car buying process. It would probably shock you how many people will simply check that the payments are what they were quoted, ignore the rest of the car buying contract and sign away.Big Mistake!
Most scams I've witnessed take place in the finance office and not, as many people tend to think, on the sales floor.
One of the more common mistakes I see customers make is to not bring their reading glasses with them and they simply take the finance managers word for it.
They will squint at the payments to see they are what they were told and eagerly sign away to finally be done signing.
I've got news for you...In a lot of states, once you've signed your car buying contract and take delivery, U.F.O.!The PG version...You Freakin' Own it!!!
Slow down, bring your reading glasses (if applicable), review the vehicle sales agreement carefully and ask questions if you don't understand something.
If you feel you are being scammed get up and leave. There is nothing legally binding you to buying this vehicle and I can promise you there is probably another vehicle somewhere out there that is just like it.
What's On A
Vehicle Sales Contract?
You'll find different car buying contracts in use from state to state, but one section that will be presented identically on all contracts, is the Federal Truth In Lending Disclosures box.
In this section
the items are disclosed as follows:
- Annual Percentage Rate (APR)
The cost of your credit as a yearly rate.
- Finance Charge
The dollar amount the credit will cost you.
- Amount Financed
The amount of credit provided to you or on your behalf.
- Total of Payments
The amount you will have paid after you have made all payments as scheduled.
- Total Sale Price
The total cost of your purchase on credit, including your down payment, trade equity, rebates, etc.
This is usually the one that confuses most people. Add all forms of down payment, your finance charge and your amount financed together to get this figure.
That I am aware of, all vehicle sales contracts, in all states are simple interest and the finance charges are not a fixed charge.
In other words, if you make your payments late then you will ultimately pay more in finance charges and if you payoff the vehicle early you'll pay less.
Of Amount Financed
In this section, a little further down the contract, slow down and read each line that has a fee associated with it. Know what each fee is and ask for an explanation for each that you have questions about.
Pay particular attention to any contract that lumps the sales price of the vehicle together with the sales tax.
If the sale price is not clearly disclosed by itself, take some time to subtract the sales tax from the sum of the two and be sure it works out to the sale price you agreed to.
This is a really easy way for an unscrupulous finance manager to stuff your vehicle sales contract.
As for the rest of the contract you'll need to review it on your own, because it will vary from state to state and contract to contract.
You do want to check for a No Cooling Off clause. If the dealer told you you have 5 days to return the vehicle, but the contract says there is no cooling off period, then be sure to get their return policy in writing and signed by a manager.
To Sum This Up
Slow down and read your contract carefully. Don't forget reading glasses if you use them.
Also be sure to have a completed Purchase Order accompany your sales contract and have that signed by the finance manager as well.
Never, ever sign a purchase order blank, even if the vehicle sales contract is complete...Scam City!!!
Remember, you have not bought anything yet and if something doesn't look or feel right you have the option to leave.
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