Car Dealership Lied On The Financing Application, So He Got Approved For A Car He Couldn’t Afford. Later He Demanded They Set Things Right With A Free Used Car.

Michael Levanduski

2 months ago

Source: Shutterstock/Reddit

When you are ready to buy a car, you know that you need to be careful with who you are purchasing from.

What would you do if the dealership lied on your financing application to get you a loan you couldn’t afford?

That is what happened to the guy in this story, so he demanded that the deal be undone and got a new used car in the process.

Check it out.

How I got a car dealership to give my friend a “newer” car

Circa 2020 January, my friend makes a stupid decision and buys a brand new car he can’t afford.

His insurance is like $400 a month, he makes like $10.25 an hour working as a shift supervisor at McDonalds.

His car payment is like $795 a month.

Now at $10.25 an hour, 30 hours a week that’s a weekly income of about $300 a week or about $1,230 a month….so yea.

So my friend came to me for help because I used to sell cars and know the industry pretty well.

I go over his paperwork.

Some dealerships are corrupt.

The dealer did rip him off, but my friend is trying to find a way to get out of this mess and ripping someone off isn’t illegal.

They did of course over charge him for warranty, they gave him a higher APR, they had add ons, etc, but none of that is illegal.

I know the only way I can get my friend out of this deal is if they did something illegal.

So I look at his finance application that my friend signed, it correctly listed his income.

Which turned a light bulb on in my head.

No bank is going to approve someone for a $795 car payment if they are only making $1,200 a month.

It does not make mathematical sense to do that.

So, I start searching through his paperwork for the finance app the dealer submitted to the bank.

You often times when you submit a finance application at a dealership the dealership will take the hand filled out application and reproduce it electronically.

This is pretty normal.

That’s a pretty big ‘mistake.’

However on the application the dealer submitted to the bank the dealer said my friend was a GM of the McDonalds and made $70,000.

My friend had good credit, so it doesn’t appear like the bank asked for proof of income.

So I go to the dealership with my friend and tell the sales manager he’s going want to put me in touch with the GM.

Because we are going be unwinding my friends deal and giving his trade in back.

The sales manager thought I was joking, the GM also thought I was joking.

Then I demonstrated how his dealership finance department committed bank fraud.

I showed the GM the finance app my friend filled out.

I then showed the GM the finance app his dealership submitted to the bank and pointed at the income difference.

How did they think he could afford that?

My friend really made $14k a year, the dealership claimed my friend made $70k a year.

That’s bank fraud, that’s a felony, lets keep this simple shall we.

The GM sees his dealership is in a load of trouble.

The proof I am presenting to him is rock solid.

He knows it, I know it, we are all on the same page.

He goes, “ok…so what can I do to make this right?”

I go, “Unwind the deal give me my friend his trade in back.”

The dealership won’t like it, but it is the best option for everyone.

Unwinding the deal is basically the GM agreeing to cancel the deal, and basically erasing the deal and pretending it never happened.

GM tries to avoid that but I remain firm and remind him we can take easily take this documentation and turn his life in a living hell.

He knows i’m right.

My friend also needs a car to get to work the next day.

The GM says he’ll check into it.

He comes back and tells me unfortunately they sold his trade in already.

I said, “That’s fine, unwind the deal and lets put my friend into something as good or slightly better then what he traded in for.”

So the GM goes, “So he’ll buy a car similar to his trade in?”

I said, “No, you’ll give him a car similar to his trade in.”

This guy isn’t understanding how much trouble he could be in.

The GM goes, “It doesn’t work that way.”

I go, “It does when you commit bank fraud.”

Gm is upset with me and I remind him I’m being really nice and this situation can totally get really ugly.

Like felony level charges ugly.

Like losing your franchise ugly.

So, yea this is going hurt, but it’s going hurt less my way.

So the GM goes alright and he looks in his inventory and he tells me they have a 2007 Focus with 10k more miles.

I tell him, “no, the car you give my friend needs to be the same or better then what he trade in.”

Um, no, he is not giving him a free car.

The GM counters, “I’m giving him a free car.”

I say, “no, you took his trade in, you sold it, you made money on that sale, you also committed a felony in the process of selling him his new car, you are now correcting that mistake. This isn’t a free car for my friend, this is a you are correcting your mistake.”

GM insists that’s what he’s willing to do I tell him if he can’t do better then that we will go to a consumer protection attorney and have a conversation with them.

My friend didn’t wanna go this route, but it was our plan B.

We get to get up, the GM says, “Wait’ give me a second.”

Civics are nice cars.

The GM goes, “I have a 08 civic, it has 5k more miles, but it’s a civic and not a focus. I unwind the deal on the new car, and put your friend in the civic at no extra cost.”

We agree

GM has the paper drawn up, the old loan on the new car is canceled, they take in the new car again (but because it’s already titled they’ll have to sell it as used, that sucks for them) and they gave my friend a better car then the one he traded in.

That worked out really well for everyone involved really. Hopefully, the dealership learned their lesson.

Read on to see what the people in the comments had to say.

This is a good idea.