TL;DR
A seemingly sweet car deal turns sour when the dealer pulls the classic yo-yo scam, using a fake “financing issue” to jack up the interest rate. This predatory tactic preys on emotional attachment, much like the 2008 subprime crisis, aiming to trap buyers in unfavorable loans.
Story
Imagine: You find the perfect minivan, a Honda Odyssey. After hours haggling, you secure a sweet 6.2% interest rate, a significant drop from the initial 7%. Victory, right? Not so fast. A week later, the dealership calls with a bombshell: they “can’t accept” your Navy Federal check and demand you resign at 7%. This reeks of the classic yo-yo scam, a tactic as old as predatory lending itself.
‣ Yo-yo Scam: Dealers lure you in with a great deal, let you drive off, then claim “financing fell through.” They pressure you to resign at worse terms, holding your down payment and trade-in hostage. It’s a bait-and-switch, plain and simple.
What happened? Likely, the dealer never intended to honor the 6.2% rate. They used it as bait, hoping you’d get emotionally attached to the car. This tactic preys on the human tendency to avoid confrontation. Many cave under pressure, just like in the 2008 subprime crisis, where borrowers were tricked into loans they couldn’t afford.
The “can’t accept Navy Fed checks” excuse is pure fiction. Checks are legal tender. The dealer simply wants to push you towards their in-house financing, where they earn hefty kickbacks. Remember Enron? Hidden fees and opaque deals always benefit the insiders, not you.
The dealer’s later claim of finding another bank to honor the original rate? Another red flag. This is a common tactic to feign helpfulness while still aiming to manipulate you.
You drove the car, added miles, and are now emotionally invested. The dealer knows this. Like a gambler hooked on the next hand, they’re betting you’ll fold under pressure.
Advice
Pre-approved loans are your shield. Don’t fall for the “we can’t accept your check” lie. Walk away if a deal changes post-purchase. Remember: dealers aren’t your friends, they’re salespeople.