10 Biggest Car Dealership Rip-Offs You Should Never Buy

SAVING & SPENDING - HOME & AUTO
If you’re ready to buy a new car, you may dread the trip to a dealership.
Updated April 11, 2024
Fact checked
couple at car dealership

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If you’re ready to buy a new car, you may dread the trip to a dealership.

Many of us hate to negotiate a deal. Others worry about falling prey to a salesperson talking them into things they don’t need.

But playing things smart can help you avoid wasting money. Do your research before you go and keep an eye out for these potential rip-offs so you don’t fall for them.

Signing you up for their financing

bnenin/Adobe saleswoman showing contract to customer

If you’re buying a car, dealers might offer you financing to help you pay for it. This isn’t necessarily a bad thing. But in many cases, dealers charge higher interest rates than what you might get from another lender.

So, it pays to do your homework before you shop. Check with other financial institutions — including your bank or credit union — to see what kind of deal they can give you on a loan.

Upselling you to a different car

Rido/Adobe couple examining new auto with car dealer

It probably comes as no surprise that many dealers would prefer you to buy a more expensive car. So, it makes sense that some might try to “upsell” you to a different vehicle.

Remember, though, it’s your car: Buy what you want, not what they want you to buy.

It will be harder for a salesperson to talk you into a different vehicle if you arrive at the dealer lot sure of exactly what you want from a vehicle, including the model and options that come with it.

Take that list with you and don’t let something else distract you.

Dealer-added options

goodluz/Adobe man sitting inside vehicle in car dealership

Sometimes, you find a particular car that you like on a dealer website. But when you arrive at the lot to take a look, you find that it’s loaded with extra options you don’t need.

For example, the car might have a spoiler or a sunroof that aren’t part of the public listing. If such options jack up the price but don’t appeal to you, consider looking for something else.

Overpricing a car

alfa27/Adobe consultant talking about features of new car to customer

The price of used cars has jumped in recent years, but you don’t have to simply accept that cost.

Instead, try to negotiate the price down. Or, comparison shop and see if you can use a different dealer’s offer to get a better price for your new car.

Pro tip: If you don’t like negotiating, a great Costco hack is to lock in a price using the retailer’s Costco Auto Program. This program gives you access to cars with prearranged Costco member pricing.

Not focusing on the full price

fizkes/Adobe senior family talking at meeting with financial advisor

Car dealers may emphasize the affordability of your monthly payment, or focus on how small your down payment will be. But don’t let them distract you from understanding the overall price you will pay.

Remember to check how much the car will cost you in total, including taxes and fees.

Also, pay attention to the length of the loan. The dealer might give you a great monthly cost, but on a loan that lasts for four or even five years. In general, the longer the loan, the more you will pay in interest costs.

A low trade-in

deagreez/Adobe marketing people discussing sales plan strategy

Many car buyers trade in their old car to try to knock down the cost of the vehicle they are buying. But before you do this, have a good idea of how much your car is really worth.

Check websites such as Kelley Blue Book to learn how much your vehicle is worth. If the dealer offers a price far below that value, think twice about accepting it.

An extended warranty

Rostislav Sedlacek/Adobe man calling for help

An extended warranty may sound like a good idea, but do your research before plunking down extra money for this type of coverage.

Some extended warranties do not cover all fixes for a car, including routine maintenance costs.

Extra fees

rh2010/Adobe couple signing documents at the car dealership

Check the paperwork before you sign on the dotted line and make sure you don’t pay extra fees if you can help it.

Some fees are not subject to haggling. But others — such as for VIN etching and appearance packages — might be negotiable.

Pro tip: Your costs don’t end when you drive the car off the lot. Maintenance, repair, gas, and insurance costs are ongoing. That's why it's important to shop for the best deal on car insurance and find cheaper places to fuel up.

Dealer prep

Nomad_Soul/Adobe car detailing cleaning salon with polishing spray

Some dealers charge a dealer prep fee. This is supposed to cover the cost of getting the vehicle ready for sale.

This is another fee you can negotiate or possibly eliminate completely.

Paint and body protection

Prostock-studio/Adobe manager showing luxury automobile to spouses

Modern vehicles have come a long way in terms of paint and sealants. So, keep an eye out for a dealer trying to sell you things such as rust-proofing and paint protection.

Chances are good that you do not need these expensive add-ons.

Bottom line

Rawpixel.com/Adobe car 3d transportation interface website

A car can be an expensive purchase, but there are ways to buy a vehicle without busting the bank.

Doing research ahead of time can go a long way to making sure you save money. And remember to check all of the paperwork before you buy so you don’t get caught paying for fees or other add-ons that you didn’t expect.

Then, once you have driven off the lot in the car of your dreams, make sure to use one of the top credit cards for gas so you can continue to save through cash back and other rewards.

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Author Details

Jenny Cohen Jenny Cohen is a freelance writer who has covered a bit of everything, from finance to sports to her favorite TV shows. Her work has been featured in The Wall Street Journal, USA Today, and FoxSports.com.

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