As a servicemember, you face several challenges when buying a vehicle. If you just relocated, you won't have the inside scoop on which local dealers are reputable and which are not. And, because pay-grades are public, the car salesperson instantly knows how much money you make and can guess your credit record. If you are young, enlisted, and have no credit or bad credit, you are especially susceptible to scams and tricks. Being prepared is your best defense.
The fact is, scams happen in the finance office not on the sales floor. The best way to avoid most scams is to come into the dealership with a loan from your bank or credit union. You should consider all of your loan options before walking into a car dealership. If you have no credit or bad credit, there are a couple of things you can do to help you get a loan from a bank: save for a larger down-payment and get a co-signer. If you cannot get the loan for the amount you want, it is better to settle for a smaller loan -- and a lower-priced vehicle -- than to accept a loan from the dealer with unreasonable rates. Your long-term financial health is at stake.
Most car dealers are honest and some are not. And if you feel that you are being misled, take the process one issue at a time, and write down what you are promised.
The next step is to see through the Financial Smoke & Mirrors.
