Got cheated by car finance

Hello everyone,

Today I bought a used car from a dealership. The cost of the car is $14,100 + $800(other govt. charges). I payed $8,000 by bank cheque and for the remaining $6,900 I took loan.The interest rate was 6.87% which I was fine with. When the finance guy explained me about the loan he did not say anything about any other charges. Neither the invoice that he gave today said anything about any other charges. There was this loan booklet which he asked me to sign in every page. Instead of giving this booklet to me for reading he just kept it in his hands and just turned the pages and asked me to sign. I know it is my mistake and I should have read it before I signed it but it had nearly 30 pages to read. In one of the page he has included $1,504 (Loan acc establishment fee + On-charged dealer agency fee + Total account adminstration fee) into the loan amount. Which is too much and he never told me about this before.

My question now is, Is there any chance I can cancel this loan without incurring any major loss? Is there a cooling off period or something? I'm now ready to pay the remaining amount(6800) to them without going for the loan.

Your help is much appreciated.

Cheers!

Comments

  • Do you have a copy of the loan booklet that you signed?

    • Yes. I came home and read it.

      • +1

        Was there any cooling off period or anything stated inside? Usually it should say so near where you signed?

      • Yes. I came home and read it.

        You read the loan booklet AFTER you signed the agreement? That's just seriously financially irresponsible.

    • +1

      For (any1) Next time:

      Find & View YouTube video (or similar to):

      • How Car Dealerships Rip You Off (The Truth)

      "Arrange your own Financing with you"

      "Negotiate on Price, Not Trade-In"

      "Don't tell them you have a trade, until the end"

      • Dealership finance can actually be cheaper than the bank, but people don't know how and what to negotiate on

  • +4

    Just about every loan has establishment fees etc

  • +1

    Establishment fee, probably about $400-$500, account administration fee probably about $10/month for the contractual period of the loan, plus a few hundred to the dealer for being the loan agent. Nothing ridiculous there.

    • It was bit of a shock to me since this is my first loan in Australia. I asked that loan agent many times to send me the loan details(including any fee) but he avoided my question. Instead he kept saying about the 6.8% interest. It looks like I'm going to pay half of the loan amount towards interest and other fees which is a lot to me. I would have instead paid the amount in full. My question is these loan fees are the same independent of the loan amount?

      • +9

        No that's ridiculous on a 7k loan… an extra $1500 in fee they OP was not aware of. Transferring the dealer delivery fee as a 'seperate charge' on the loan schedule is particularly dodgy.

        By the sounds of it the dealer finance guy played on the OP's lack of knowledge here and made himself a good payday.

        My advice in this instance is make a complaint to the dealer principle outlining the non disclosure and your preferred remedy (to reverse the loan and simply pay the amount yourself). If you get an unsatisfactory response approach the Financial Ombudsman Service. Hope this guy has his licence challenged.

        http://www.fos.org.au

        I had a similar thing happen to me when i was a bit younger and more naive, not a nice feeling knowing you got fleeced.

        • +1

          It's not a dealer delivery fee, that is part of the cost of the vehicle. It is a loan agent commission, for the dealership acting as a loan agent for whichever financial institution is actually funding the loan. Basically a broker fee.

      • +1

        he avoided my question

        Red flag alert. If sales person isn't being 100% upfront with you, and isn't allowing you to read/help yourself. Walk away.

      • -2

        IF you're Not getting the info you Requested
        CANCEL & Go to a REPUTABLE Dealer, of course.
        using tips from above & other YouTube videos

        Don't tell 'em it's your first Loan.

        Do your Homework first

        (Eg, see what "The Barefoot Investor" says
        about all sorts of money-saving / -growing
        matters)

  • What State are you in?

    If you are in NSW you have a 1 day 'cooling off' period. You must terminate the Contract in writing by 5pm the day after the Contract is signed. Expect to pay a 2% termination fee.

    QLD has a similar law, but you do lose the right to a cooling off period if you take possession of the car.

    • I'm in SA

      • +2

        You may find what you are looking for here -

        https://www.positivelendingsolutions.com.au/resources/inform…

        • -5

          They show SA's Cooling Off rules
          but Don't take their Loans, ie,
          just because they helped with Cancelling

          ALWAYS Shop Around!

          (Isn't that why you're here on OzB…? ;~)


          Hold on… You say you bought it TODAY?
          Your OP is ~9.5 hours old => Bought it ~1 AM..?!?

          What am I missing?


          If you bought it on Saturday,
          you may be OK, for Cooling-Off
          period. If they're open today,
          GO TODAY

          Cancel the Deal IN WRITING
          & take a witness OR
          get them to Sign a copy (that you keep)
          for them having Received it.

          IF they Refuse, your friend
          can (later) sign a Stat.Decl'n
          that s/he watched you offer &
          leave your Cancellation Letter
          AND that they Refused to sign,
          that you did.

          WOULDN'T WE SAVE LOTSA TIME,
          if everyone played more Fairly?


          A Story from the early 2000's:

          My first car (in AU):

          An ancient] Volvo 245 bought
          (by the mechanic I bought it
          from) at wholesale [auction]

          Asking-price in Gumtree ad: $750

          I paid: $550

          (He said he paid $500 for it, &
          needed $50 towards his shop rent)

          I later drove that car thru Marree
          & back (several times) over 12 mon
          problem-free. (OK, once - on dirt
          road - its speedo died, after hit-
          ting a hole…)

          Living modestly is Not impossible

          • +5

            @IVI: It's times like this I wish I'd invested in ozbargain premium

            • @brendanm: I want the algorithm for which words to capitalise and which to abbreviate. It hurts my brain to read every time

              • @timthetoolman: I think if you do acid for about 10-15 years it will simply come to you.

                • @brendanm:

                  I will Try it - - (Later t'ght)

                  {If Able to get (acid)}

                  [have got in Past w'out issue so should be ok this time] >>>>>>^^

                  Man this is hard work
                  Need more tabs

                  • +1

                    @timthetoolman: I think you're getting the hang of it already, I have a headache after reading it so you are heading in the right direction.

  • +6

    *sigh. Never sign anything without reading the details. Never trust s salesman to tell you everything.

    • True. Like I said this is my first loan. Lesson learnt in a hard way. Thx

      • -1

        It's just like FIRST-TIME SEX…

        Do your due-diligence,
        check-out the "deal" (person)
        oh… & wear protection.

        There's Never any Need to Rush!

    • +5

      Never trust a car salesman, they have no integrity.

      • +1

        Business manager isn't a car salesman 😉

  • -1

    what's 14100$

    • Cost of the vehicle

      • I Never pay dealer loan fees, i tell em to get stuffed and they always re neg on it, i am talking $50k plus car every 5 years, its never $1500 though. Take the car back and throw the keys on his desk, don't pay another cent till they refund you.

      • so you meant $14,100, no wonder you got ripped off.

    • Price read in hebrew

  • Sounds normal to me

  • The interest rate was 6.87% which I was fine with.

    Is that advertised rate or comparison rate?

    • You might find a New Car
      w/ MUCH LOWER Interest Rate
      (via the car's Maker)

      When you sell, you may get
      more for a "1-owner" car.

  • included $1,504 (Loan acc establishment fee

    Yep, pretty common.

  • +6

    Can we please amend the thread title to… I CBF'd reading the contract I signed. Now I want out.. LEL?

  • +4

    Welcome to OzBargain … the place where "cheated" is defined as "I didn't read what I was signing, now have buyer's remorse, and think someone else should be responsible for my actions."

  • +3

    Taking a loan to buy a car negates any savings you have negotiated with the dealer. And suddenly you are able to fork out the extra $6800, why take the loan in the first place?

  • +2

    Today I bought a used car from a dealership.

    I think you bought a car from a stealership.

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