1. Secret Price Hike
Many experts believe that this is the most
common scam in leasing. Capitalizing on peoples trusting nature and
aversion to complex financial calculations, the salespeople simply inflate
the price of the vehicle before calculating the lease payment.
How it Works: You
negotiate like a mad man for hours to get to a fair price on the vehicle.
The salesman gripes and complains about losing his shirt on the deal and
tells you what a great negotiator you are. He goes off to write up the
papers, then presents a lease contract with a payment $30 higher than it
should be. What happened? The salesman gave himself a nice fat bonus by
adding $1000 to the price you negotiated before calculating the payment.
Unless you check the numbers yourself, this secret price hike may go
unnoticed, especially after many hours of haggling.
How to Prevent: Before
you begin negotiating, insist on disclose of the residual, money
factor or interest rate, and any applicable fees, rebates, or incentives.
After you agree upon a price for the vehicle, calculate
the payment yourself. Be sure to account for any down payment, trade
equity, rebates, incentives, taxes, and fees. If the payment on the
contract does not agree with your calculations, do not sign anything.
Once you sign the contract, it is very difficult (if not impossible) to
change. The salesman may try to explain away the difference with lies
such as, "The cap cost has no effect on the monthly payment."
Or, "The difference is the interest on the lease."