What Do I Do If I Am Scammed By A Car Dealership?
Cars are a necessity for lots of people in Nova Scotia. People often go to a car dealership to buy new vehicles as they can get a good deal with a low-interest rate, and feel more protected purchasing this way than through private sellers. So, what do you do though, if you are scammed by car dealerships?
In this article, we’re going to take a closer look at what you should do if you’re scammed by your car dealer, how you’re protected in Canadian Law, and some signs to look out for to avoid scams.
What to do if Scammed by Car Dealership: The Facts
Unfortunately, dealership scams do occur sometimes, but there are things that you can do if it happens to you. The first thing you need to determine is whether you are a victim of a scam. Ask yourself the following questions:
- Am I paying more in monthly payments than I was quoted or told in my original loan documentation?
- Am I paying for a service I didn’t agree to?
- Was I asked to pay upfront fees?
- Can I still contact the car dealership?
- Am I being threatened?
- Are there blank spaces in my contract?
If the answer is yes to any of the above, you could have been scammed by the car dealer. But don’t panic yet. There are plenty of things you can do if this has happened to you.
If you cannot come to a reasonable resolution with the general manager of the dealership, you should report your experience to your provincial or territorial consumer affairs office. These agencies will help to protect your rights and interests. In Nova Scotia, you would make a complaint to the Department of Service Nova Scotia and Internal Services about any business you feel has treated you unfairly.
You will then need to contact your bank or credit union to stop any withdrawals pertaining to a fraudulent loan as well as the major credit bureaus in Canada (these are Equifax and TransUnion) to issue a fraud alert for your credit report. This ensures that no new credit accounts can be opened in your name.
The next steps to take include changing your passwords on all accounts that cover your finances. This step is just to cover your back and make sure you are protected. You should report the scam to the police and you may also consider filing a complaint with the Better Business Bureau.
Consumer Rights in Nova Scotia
The Consumer Protection Act in Nova Scotia provides you with the following protections::
- The seller must have the right to sell the product to you
- You must be able to own the product, once you’ve purchased it, without any hassle
- A third party should not be owed any money for the product
- The product you buy matches the description you were provided with before the purchase
- What you buy will suit your needs and will be recommended based on the needs when they are communicated to the seller
- The product is still of good quality when you buy it unless specific defects have been communicated to you
- The product is new and unused unless otherwise communicated
Additionally, any contracts that you sign need to contain all the information you need to be comfortable and secure in your purchase. And, regardless of what the contract states, your rights always apply.
How Canadian Law Protects You When Buying a Car
In addition to your consumer rights in Nova Scotia, the Financial Consumer Agency of Canada offers specific protections when buying a car. These protect individual consumers from many different scams and all legitimate dealers will abide by them.
For auto loans:
- When auto loans are arranged by a dealer through a bank, federal consumer protection laws apply.
- If an auto loan is arranged through a provincially or territorially regulated lender, like a credit union, then provincial or territorial consumer protection laws may apply.
- It is important to note that some independent lenders who specialize in auto financing are not regulated.
- Lenders/dealers are required by law to give a disclosure statement to consumers before entering into the agreement. This will explain the total cost of borrowing and other important information. Ensure you read all the documents, including the fine print, to be fully aware of the situation.
For car leases:
- You are covered by provincial or territorial consumer protection laws.
- As above, most provinces and territories require the dealer/lender to give you a disclosure statement before you enter into an agreement.
Signs You’re Being Scammed by a Car Dealership
While there is a lot you can do if you have been scammed by a car dealership, one of the best things to do is to learn to spot the telltale signs of a scam and avoid it before it happens. We have gathered a few of the obvious signs that you are going to be scammed by a dealer below to help you out.
- The dealer has misrepresented the repair records or accident history of the used car (you should be able to see this yourself using the vehicle identification number (VIN))
- They asking you to pay upfront fees and keep adding on additional costs for your vehicle
- The contract is different from the original agreement
- They run a credit check on you without asking first
- They fail to pay the trade-in fees you agreed on your old car or vehicle
- The vehicle is in poor condition when you receive it
- They are advertising ‘guaranteed approval’ for auto loans
- They offer you a lower trade-in price than your car’s market value or commit trade-in fraud
When it comes to buying pre-owned cars, you can generally trust a dealership. However, it is always good to be aware of what constitutes a red flag.
Remember to look into the history of your vehicle and take it out for a test drive, if you’re able before you purchase to avoid buying vehicles with mechanical issues, and keep your eyes peeled for any other signs too.
If you’re looking for a used car dealership you can trust in Nova Scotia, get in touch with Race Auto Group today. We pride ourselves on being a one-stop shop for purchasing and financing a vehicle.