Car Dealerships Can’t Charge You for Add-Ons You Don’t Want: Understanding Your Rights and Protecting Your Wallet
Updated: Oct 29
Historical Information Notice: This article preserves the context and scope of its original publication on 08/26/2024. Laws, policies, procedures and fees may have changed. Do not rely on it as a current filing or action guide. Consult a qualified attorney about current requirements and their application to your circumstances.
When buying a car, review optional products separately from the vehicle price and financing terms. In August 2024, the FTC filed an administrative complaint against Asbury Automotive and three Texas dealerships, alleging unauthorized add-ons and discriminatory charges. A complaint contains allegations; it is not a final determination of liability.
What Did the FTC Allege?
The FTC’s August 2024 announcement described allegations that buyers were charged for unwanted products, including charges described as mandatory. The reported figures were the agency’s allegations, rather than adjudicated findings.
The complaint also alleged that Black and Latino buyers paid more for add-ons. These allegations should not be described as findings that the dealerships violated the law. Review the FTC proceeding docket for procedural developments and any final disposition.
What Sales Practices Were Challenged?
The complaint challenged the use of electronic signing displays and other practices that allegedly prevented buyers from understanding the full terms. Ask to review the complete contract, itemized price, product terms, and financing disclosures before signing.
The proceeding illustrates why buyers should retain complete documents and compare written charges with the products they actually authorized. Whether a particular transaction violates the law depends on its facts and the applicable legal requirements.
How to Avoid Overpaying for a Car
While it’s disheartening to learn about such deceptive practices, there are steps you can take to protect yourself from overpaying for a car and falling victim to similar scams. Here are some tips to help you avoid unnecessary charges and ensure that you only pay for what you want:
Read the Sales Contract and Financing Agreement Carefully
Before signing any documents, make sure to read the sales contract and financing agreement thoroughly. Ask the dealership for a printed copy of the contract to review at your own pace, and ensure that the terms match what you agreed upon during negotiations. Pay special attention to any additional fees or add-ons listed in the contract. If you see charges you don’t recognize or didn’t agree to, ask the dealer to explain them. If the charges are for add-ons you don’t want, insist that they be removed.
Know Your Total Cost, Not Just the Monthly Payment
It’s easy to get fixated on the monthly payment when buying a car, but it’s crucial to understand the total cost of the vehicle, including all fees, taxes, and add-ons. Dealers sometimes try to make the monthly payment look more attractive by extending the loan term or adding hidden fees to the overall price. Always get a breakdown of the total cost in writing and review it carefully to ensure that it includes only the charges you agreed to. This will help you spot any unauthorized add-ons and avoid paying more than necessary.
Shop Around for Financing
Many car buyers rely on dealership financing without realizing that it often comes with marked-up interest rates. While it may seem convenient, it’s not your only option. Before visiting a dealership, consider getting pre-approved for an auto loan from a bank, credit union, or other financing company. This gives you a clear idea of what you can afford and provides a benchmark to compare against the dealership’s financing offer. If you get pre-approved, you can use that offer as leverage to negotiate better terms with the dealer or opt for the external financing if it offers a better deal.
What to Do If You’ve Been Overcharged
If you believe you have been charged for add-ons you did not agree to or if you feel you have been discriminated against, you have the right to report these practices. The FTC encourages consumers to report any suspicious or fraudulent activity to help protect others and hold businesses accountable. You can file a complaint with the FTC at ReportFraud.ftc.gov.
Conclusion
Buying a car should be an exciting experience, not a stressful one filled with hidden fees and unwanted charges. By being informed and vigilant, you can protect yourself from deceptive practices and ensure that you only pay for the add-ons and services you truly want. Remember, car dealerships cannot legally charge you for add-ons you have declined. Always read your contract thoroughly, know the full cost of your purchase, and shop around for financing to secure the best deal possible. Your diligence is your best defense against scams and unfair practices.
Legal Disclaimer. Originally published: 08/26/2024. This article provides general information only and is not legal advice for any particular matter. Laws, policies, procedures, fees and agency practices may change; their application depends on the facts and jurisdiction. Consult a qualified attorney about your circumstances before acting on this information. Reading this article or contacting Blumsack & Canzano does not, by itself, create an attorney-client relationship. Past results do not guarantee future outcomes. This material may be considered attorney advertising in some jurisdictions.
