Last week, after leaving the office I stopped off to get some gas - and as I was leaving the parking lot my car stalled out on me! A little miffed...ok, really not happy about this I called a guy I used to go to school with (he sells cars) and told him how much I thought my car was worth, how much I owe, how much I would be willing to put down and asked him to find me something to trade my car in on. My car is only a few years old and has a LOT of miles on it (what can I say, it's my mobile office!!) so I know I owe alot more than what it's worth and I was ok with that. My husband and I went to the car lot to pick something out and went in so we could discuss the terms, payment, etc. Of course, as in all car buying scenarios I've ever been involved in - they bring out the "sales manager". He makes friends with us and goes into this long story about his girlfriend that had a 350Z that she was way upside down on and then tells us that while he is not "advising" this, only "suggesting" it.... his suggestion is that we just take my car back to the dealer and drop it off... What???? Seriously? That's your suggestion... Ok, I'm not actually saying this out loud - but this is what is going on in my head.. He tells me that it would really only hurt my credit for about a year and that I would have no trouble buying a car now or in the future.... At this point I tell him this is not even an option for us... He says well, it might become an option if something big goes wrong with the car and that we should just go home and think about it.. I am amazed at this point!! I then go on to tell him that I know for a fact this would hurt us much longer than a year and that we will not at any point consider this - that even if the car breaks down and I have to show clients on a bicycle we will continue to pay our payment for the sake of our credit - and not to mention the obligation we took on 3 years ago when we so happily signed on to pay this note.
I understand that alot of people are in a situation right now where they have to choose between feeding a family or paying their car payments, mortgages, etc -- but for a business to "suggest" that this is the option we should take to alleviate our temporary situation just appalls me. I have been thinking about this alot lately, and there was a time when I was younger that I might have thought this "sales manager" knew what he was talking about and taken his "advice" - thank goodness I'm old enough and well, I like to think - smart enough, to know this only benefits the car company and not me. They get to sell a car - and I get to walk away with my credit ruined!
The point behind this blog is to let buyer's and seller's out there know - whether when you are looking for a car or making a real estate purchase - use a professional you can trust to give you sound "suggestions" and make sure to use your own best judgement when someone else is giving you advice. If it sounds a bit fishy to you - it probably is! Use your noggin people, these sort of "mistakes" will haunt you for a very long time to come!
If you're looking for an honest agent to help you with your next home sale or purchase - think of me -- and don't worry- I won't suggest any of that crazy nonsense!
Visit one of my websites for more information on homes in the Lake Texoma / Pottsboro/ Grayson County areas www.HomesByLainie.com, www.ViewPottsboroHomes.com, www.PottsboroHomes.com, www.AllDenisonRealEstate.com, & www.SearchShermanHomes.com
- Lainie Ramsey
Walking away is always an option. Why not consider it? (with all the consequences) and all the other options too, including the possibility of calling a repair shop.
WOW what a terrific post! You are right! 100% It really is funny that people don't take a fudiciary pledge to all consumers. THank you for the post.
Wow Lainie! I think I'm as surprised as you are. I bet he wouldn't have said that if he was the one that was owed the money on it.
I bet he wouldn't have said that either if I owed him money -- or if he knew I would write a blog about his advice!! Lucky for him, I didn't mention his name. And Ron, for me walking away is not an option (and I hope it never has to be) - I learned early on in my life how important my credit is and I certainly don't plan to ruin it now.
WOW, I'm shocked! I can't believe he would advise something like that. I hope you're not buying a car there even though your friend works there. It's people like this that help contribute to our nation's debt.
Great story and a great similarity to what people are doing with their homes right now. It is a tough environment now and this guy sounds like he is just trying to make a sale.
So it's morphed over into the car business - 'just walk away.' I have always heard a car reposession is one of the worst things you can ever have on your credit report.
I've never heard this advice before. Walk away from a car. Doesn't surprise me at all. We have people telling sellers to just walk away from the house. Give it back!!!
What a situation! And, you are right. It's important to be sure of the qualification and perhaps the qualities of the people from whom you take suggestions.
Amazing! I have never heard of such a thing as willfully going into a car repossession! I guess for some people, the idea of doing the morally responsible thing is not important. I also do hope that you will not support that company & shop elsewhere for your next car.
'Do the Hustle' ?!? Anyway, congrat on the feature and did you see the other 'like-blog' about Joe Isuzu?!? Pretty timely.
great story and just shows how people are willing to go back on their word on just about anything anymore
This is the same thing that has happened with many homes so I'm not surprised. Buy a new one while your credit supports it then give back the old. one. This is never a good idea.
Have a great day
Tony
All too common, stories like this. But we have a problem in our industry also. There are agents out there who are selling current homeowners a new house while they "rent" the old house, but then actually just do a short sale or deed in lieu on the first house. That is fraud on a grander scale.
Good advice! There is an old expression which states: "Consider the source" (for advice)
Lanie,
That's a pretty bizarre recommendation, even coming from a competitor.
Rich
Yes, I was as surprised as you all that someone would suggest this.... I guess in this sort of economy nothing should surprise us! I do understand that some people have no other choice with having lost jobs but I do feel that if there is any possible way to honor your obligations - you should. Because Karma (or maybe it's just what goes around, comes around) will bite you in the butt when you do things that are not ethical.
The unwinding of the moral fabric in the country is amazing to me. I guess I'm hoping it's not for real. It can be destructive and hurt our society as a whole.
I am astounded that he would say such a thing. I have heard of people doing that with houses but never with cards. Good thing you walked away. -Marian
The sad part is that that is the shape our economy is in, people are willing to just "walk away", what really bothers me is that a supposed professional suggested this option>
Oh how horrible, this is just not right.
The walk away mentality is really growing isn't it?
Gosh cars and especially cars for Realtors are always upside down.
Lainie...My favorite analogy for this suggestions is: Humpty Dumpty didn't have a net...and all of the kings horses and men couldn't put him back together again. All we have is our integrity, and a promise to pay a note is our word and bond.
That is just not right! But what is these days? He's the reason why the public do not trust a car salesman. I'm glad you said something to him. You let him know you are not stu-pid! Have a great day Lainie!
Unfortunately this was done often in the past (the 80s). Now with the Internet, it is gaining more momentum.
Lainie - this is crazy. I wonder if the owner of the company knows he's making these types of "suggestions." Makes you distrust anything else he says.
Lanie:
Do you know how long he has been in business? It doesn't seem like a long term plan to be telling customers to deliberately ruin their credit. With all that is happening right now I can't say that I am shocked, but certainly concerned.
I wrote about my recent car shopping experience at How car dealers and real estate sales people do Business and think just how lucky I am that I have no car payment.
A few years back, my aging father, just had to have a car and a drinking buddy from a local gin mill gave him a ride over to his dealership. Bing, bang, boom he was driving a junk used car while his only income at the time was from social security which happened to be used for the small rent he paid. Anyway, my brother took the car back within a couple of days and explained why our father could not afford to own the car or could safely operate one at his advanced age(They won't do cataract surgery under medicare until you kill someone).
The dealer took the keys and, of course, could not sell the junk for anything near what my Dad had agreed to pay for it. They set out to have a collection agency harass him for the difference of what he paid for the car and what they ended up selling it for to another buyer for years. It was a good thing the harassment was stopped at our phone and address so he could enjoy his remaining years.
I am with everyone on this one. Unbeliavable. Gregory: I hate it specially when sales people take advantage of our senior citizens.
It's about more than a car that you owe more for than it is worth, it is integrity, morals, doing the right thing, like you said. Where is it heading, scary thought~ Good for you saying take a hike, how many younger consumers will follow that exact advice though and continue to erode the economy as they try to recover their credit for years?
Just drop it off at the dealership??? I wonder if the bank or finance company would appreciate you giving "THEIR" car away to someone who doesn't own it. Few if any dealerships finance cars with their own money. They get you financing from a bank or finance company and do not hold any paper except the green paper with some presidents picture on it which was their commission for placing the loan through them.-----Some used car dealers may hold paper on less expensive cars and charge you high interest rates because you aren't able to get bank financing on the car either because of the credit problems you have or the bank knows the car isn't worth much now and won't be worth anything next year.
You chose wisely to walk away from this guy....credit score intact.
Larry Mennetti Five Star Real Estate Grand Rapids, Michigan
Lanie,
Some people believe that walking away from obligations and debt is just "okay", but it's not. It's wrong. But our system helps them to be able to get new credit in just 2 years!
Most people know that when they have a fairly new car it will never be worth what they owe on it. They are what is called upside down in the loan. In the past banks have let this go and be rolled into the new car purchase. It sounds like apparently they may be cracking down on this procedure. Just like with homes that people buy and try to sell within a few years. Good thing we do not have a system of just trading in houses, one for another like cars.
Great post Lainie - well written. Thanks for sharing. I always tell people if it sounds too good to be true, then it probably is, especially with people trying to take advantage of people facing foreclosure.
We do live in interesting times.
Hey, if you are going to just bale on the current car... Why not go out and buy another one FIRST and then drop the old one off. That's called "Buy and Bale"... it works on houses.. why not cars. Then it won't matter how it hurts your credit... in the short term. Just Kidding... Just Kidding...
Lainie, Great post! this is exactly whats going on in our economy for years and now it is obvious! I wrote a very similar post "True Character in hard times will determine your wealth in good times" covering very similarly the sames issue but with regards to housing. You are a person of character and I commend you for writing this post.
Joel Silberstein
This is an interesting post about sales tactics - the only thing the guy cared about was making that sale, didn't care about you at all. In light of the other featured post from today, this is why I don't think of myself as a sales person on the buyer side. Because I have my client's interest top-of-mind, it can't be about my next paycheck when someone's making a decision about buying a home.
My first inclination is to tell this guy," Ill talk to your sales anager now, thank you." and proceed to rip someones ass apart...pardon my french!.
What idiocy!
I agree-- just walk away. FROM THAT SALES MANAGER!
Personally, unless I felt that I had been taken advantage of, I would feel that it was my moral obligation to pay my debt as I 'promised' to do when I signed the loan papers. Too bad so many people do not feel that type of moral obligation.
Way to stick up for yourself!!! Great post!!!
Amy in TN
Skipping out is not an option. I am sure there are people out there that don't have a choice but just deciding to bail on a debt is wrong. And the Sales Manager should know better. I wouldn't want to do business with that guy.
I am thinking this car dealer is not in the finance business, and expects no return business either.
Stick the next guy with the bill, but bring me a sale.
Wow...this just stunned me. What's so concerning is how many people do you think actually will listen to this guy as he is supposed to be "the professional." Walking away from your debt and responsibilites is just wrong. Good for you in standing your ground and keeping your honesty, intregrity and credit score intact. Great Post!
Those that drop off the car at the dealer (voluntary repo) will be penalized greatly with higher rates on future purchases. I don't think the penalty is steep enough.
The bailout mentality of America will be her downfall
Character is easier to keep than to restore...
What about following through with your commitments? Sounds like this guy just wants to have everyone take an easy way out. Steer clear of people like that and you will be much better off in the long run.
Hi Lainie, Yikes ! This guy is dangerous ! I would report him to the BBB and or the states attorney. This is so wrong on so many levels ! You are a much better person than this guy !
Lainie - great post, I agree, you need to know who you're going to work with, their experience and their character.
Also - I love your car saleman photo. I've been looking for one like that for an upcoming presentation. Where did you find it?
Thank you!
Monica
I've heard some crazy advice lately, too! It's mainly about walking away from credit card debt , since the CC companies are now using the "fine print" on the contracts to change payments, interest rates, etc. I can't wait until all this nonsense is behind us!
I find people today are very conservative in what they want to buy and how far they will stick their necks out.
I'm not surprised at all. I spent 10 years loaning and collecting money before going into Real Estate and this type of comment from a car dealership is no surpise to me. He want's to make the sale and it needs to be profitable, he didn't think he could do that with you trading your car in... so he gave you a "quick, simple" option that many people would consider. He was hoping you would consider so he could make a sale.
This is a good example of what is wrong with our economy- not just the fact that you could "drop the car off", but what he was willing to do to make the sale. It's greed; pure and simple. The lenders ran rampant for years loaning money to everyone (NINJA Loans), then selling the debts left and right, and are now suprised that many can't or won't pay it back?
I have to live with myself and sleep at night too Lainie. Unfortunately, not everyone is like us.
It's amazing how low some people will go! No wonder the public views real estate agents one step above a used car salesman. It's people like this guy that give all "sales persons" a bad reputation.
Hi Lainie...At least he made it easy for you in one respect, you know that you do not want to deal with his company. I bet you could not get out of there fast enough.
Good job!
Kate
Lainie, Don't you just love that everybody's an expert. May we never act like that.
When are people going to start learning that rampant consumerism has huge consequences and you can, but shouldn't just throw things away because the situation doesn't work for you anymore. It is amazing to me how quick folks are to just walk away instead of try to work their problems out. I think the whole bigger, better, newer gig has gotten the better of too many people!
Lainie, and we wonder why the economy is struggling in some areas!
Ty
Lainie,
Good information. That definately is the time to walk out the door.
Amazing! But, Isn't a 'suggestion' actually in most cases really giving advice. Some are good 'suggestions' and some are bad! Seems like many people give out too many bad 'suggestions' rather than trying to come up with a good 'solution'. By the way, great picture of a cheesy car dealer.
Maybe I missed something, he was advising you to buy after a year not right then wasn't he. What do you tell a seller that is upside down and the banks want refi, re-mod and she /he cannot make the current high payment.
Well, if he didn't want your car as a trade in, that really says a lot about his desire to have you as a client. Most dealers have an incredibly lucrative side business of shipping used cars across the entire country if they can't sell it locally.
Look on the bright side, at least you won't have to compete with this guy for buyer clients in real estate!
That is really crazy. People are thinking of anything to make a buck these days.
Wow! I am amazed at all the comments I have received today! Thanks so much everyone!
Consider the Source..... always rings true with me! Kathy
Lainie - Apparently some people will do anything for a sale, even if they are the manager.
I love it! What a crazy story and then great advice that comes from it. It's heartwarming to hear about people who take their responsibilities (financial and otherwise) seriously. There are too many folks who would have taken the manager's "advice". Good for you for being honest, responsible and thinking for yourself. Bravo!
What he meant to say is that you take the car back to where you bought it and do a volutary repossession. Where he is screwed in the head is that he thinks that it will ONLY affect your credit for a year. Repossessions will sit on your credit report for a minimum of 3 years. Whether or not another company will overlook it remains to be seen. Ultimately, it will also affect your credit score and this in turn can hurt you with credit cards, insurance, buying anything on credit, and on and on.
Smart for walking away. I'd turn the guy in to somebody, BBB, AG, NADA etc. I'd also blog and use his name. You can't allow this stuff to go on.
Thanks, Courtney! I did feel very responsible telling him that this sort of a situation was not even up for negotiation with us...as I walked out of the dealership with my head held high! And Danny, you are very right! Of course it stays on your credit for forever! Mike, I wish I was mean enough to post his name, but alas - I just can't bring myself to do it :-(
great looking cigar...yet so true
Wow - I have never heard of a car salesman doing that - or being upside down on a car for that matter. Thank God there are responsible people out there like you!
I wish I had never heard of being upside down on a car, Emily!! I have pretty much always been upside down on the vehicles that I own because I drive so very much! However, I am going to make sure to, if not stop the cycle, at least severely decrese the negativity by just paying this car off - and like I said, if it ends up not making it - I guess my clients and I can just be "green" and ride a bike to look at homes...LOL!
I am with all the other kids.. wow wow .... next we will be dropping off applicances and furniture back to their place of origin.
That is a sad statement about the values of some businesses or sales companies. How low will some businesses go to make a sale?
Unfortunately, it is true that some sales people are desperate and will manipulate the consumer in order to close the deal. I don't think that people are as apt to agree to deals and signing a contract unless they really understand the consequences. The fine print has many out with their magnifying glasses.
Amazing - but I'm guessing it will happen a lot after the "Cash for clunkers." At the time I thought that a lot of people who really couldn't afford a new car were buying when they shouldn't - just to take advantage of that program.
As for being upside down on a car - that's not unusual at all. I remember once thinking about trading in a car that I had been paying on for about 4 years - and the interest rate wasn't too bad. When the salesman told me that I would NEVER get enough from a trade in to pay off the loan, I told him yes I would... because I was keeping it until it was paid for. And that's what I did.
Another time I had a car stolen from the dealer's lot - I had taken it there for repairs. When I called my insurance man he told me the insurance wouldn't pay what I owed on the car.
Those things depreciate so fast it can make your head spin!
Lucky for me, my car was found - undamaged. A boy who worked at the lot had been fired, so to get even he took a car and drove it for a couple of days, then parked it at the High School and left it to be found.
Forgot to say... I love your sleazy car dealer photo!
Hi Lainie,
Wow what a story. It is amazing what people will suggest. You are right you always have to consider the source! I also love the sleazy car dealer photo!
Wow, if it doesn't feel morally right to you, don't do it. I can't believe that was a suggestion but then we live in a throw away, solve it quick society now don't we. Makes me feel bad YOU even know this guy.
Upside down on a car???? I've heard of jingle keys for houses, but cars now?
I've bought many cars from dealerships and have little trust in anyone that I've ever dealt with. I buy over the phone now. They tell me I can't do that. I don't care, I just do it. I know I can't test drive it, but I'm sure a towncar drives pretty nice, I trust that.
Good one, Lainie. The key thing is, sometimes people want to hear things so they can feel validated. He probably said this many times before and a lightbulb went off in the buyers head and they did what he told him, too. The same is true for homeowners. They list there house with a person who tells them what they want to hear because it validates all they have been thinking. Regardless of the fact that it's not reality, it will hurt them now and later because the house won't sell or it will sell for lower than it should have and with more headaches. We all need to be strong enough to be able to look in the mirror and actually understand what we see. We might not agree with it, we might not like it, but we need to understand it correctly.
I can not believe a SM would say such a thing....just goes to show what a low life he is
Wow. I'm in the same boat with my car, I still owe more on it than it's worth and it's not maintaining well these days. I'm just trying to get as many miles as I can out of it so I can minimize the amount I'll have to PAY someone to trade it in. I've gotten some shady advice on what I should do with the car, but not from a dealership!
Reviewing some old featured posts, this one clearly needed a comment. It is so important to use qualified experience and trustworthy professionals in all transactions (cars or houses). As more scary people are around it is more and more important too.
Feel free to visit me back at my lethbridge real estate blog and leave me a comment to let me know you stopped by.