Buying a car can be an exciting yet potentially perilous experience, especially when dealerships employ tactics that put your purchase at risk. One such strategy making headlines recently is the “bailment agreement,” also known as the yo-yo or come-back scam. In this blog post, we’ll delve into the details of this underhanded practice, how it works, and most importantly, how to protect yourself from falling victim to it.
Understanding the Bailment Agreement:
- Spot Delivery and Financing:
- Dealerships often employ a spot delivery, allowing you to drive off with your new car the same day you choose it.
- Financing is usually not finalized at the time of purchase, and this is where the bailment agreement comes into play.
- Bailment Agreement Basics:
- A bailment agreement is a clause in the paperwork you sign, stating that if the financing falls through or needs adjustment, you’re obligated to return the car at the dealer’s request.
- This agreement provides dealerships with leverage to coerce buyers into paying more, accepting higher payments, or even swapping for a different car.
The Resurgence of an Unsettling Practice:
- Recent Media Coverage:
- Articles on reputable platforms like Jalopnik and warnings from automotive expert Steve Lato highlight the resurgence of the bailment agreement tactic.
- Car buyers need to be aware of this practice, as it can jeopardize the fairness and transparency of a deal.
- Dealerships’ Unfair Advantage:
- Dealerships, by utilizing bailment agreements, gain the upper hand, allowing them to backtrack on a deal even after the buyer has driven off the lot.
- The potential for manipulation and coercion becomes a real concern for consumers.
How to Protect Yourself:
- Delay Signing a Bailment Agreement:
- If you’re financing your purchase through the dealership, resist signing a bailment agreement until the financing is approved and finalized.
- Dealerships may want to rush the process, but it’s in your best interest to wait.
- Insist on Transparency:
- Communicate with the dealership that you won’t sign any agreement that gives them the unilateral right to alter the terms post-purchase.
- Ensure that the deal is concrete and transparent before committing.
- Avoid Speculation:
- Refrain from speculative deals where the dealership expects you to commit before finalizing financing.
- If they can’t guarantee the terms, you shouldn’t be obligated to stick to the deal either.
The bailment agreement scam is a practice that savvy car buyers should be aware of and actively avoid. By understanding how this tactic works and asserting your right to transparency, you can protect yourself from falling prey to unscrupulous dealership practices. Don’t let the excitement of a new car blindside you into an unfair deal. Stay informed, be assertive, and remember that there are plenty of reputable dealerships ready to provide a fair and transparent car-buying experience.