Think things through; mistakes can be costly
Once you sign on the dotted line, there’s no cooling- off period, writes Lorraine Sommerfeld
“When I got home, I started going over my new car contract, and I realized that I’m getting an extended warranty I’m not even sure I need. Can I get out of it?”
I get a version of this question every week. It could be questioning a service charge, fabric protection, undercoating, paint protection or many of the other lines of minutiae that make up the densely packed wording of most contracts.
I have to refrain from simply saying ‘ No’ because it borders on being snarky and insensitive, which doesn’t help anyone, including a new car buyer who just made an expensive mistake.
That contract is a legally binding agreement. You don’t get to change your mind. You don’t get a cooling- off period. If you said yes to that trade- in amount, yes to the upgraded floor mats and the etchings, yes to an electronic rust proofing device that doesn’t work, you have chosen what’s behind curtain No. 3.
Michael Turk is a lawyer with the Automobile Protection Association ( APA), a non- profit consumer association I work with on my TV show, and he fields the same type of questions.
“It remains the question I can count on getting every week, even after years and years of doing this,” he tells me.
I’ve spoken with advocate agencies such as the APA and I’ve spoken with car dealers, psychologists, and market experts. Some emotional switch gets flicked at some part of the process when the pen hits the paper. A salesman will call it “closing a deal,” but I liken it to that moment a calf falls over and gets its legs tied together.
Buying a new car can be like standing at the gates of a midway: So much going on, so much noise, so many distractions. Educated consumers have already done their homework — and statistics show buyers are more prepared than ever before — but when the heavy artillery gets hauled out ( that would be the airless little room you get stuck in with the financial person), it takes some strong knees not to buckle.
Here’s the thing: if you want some of the products and services offered, that’s fine. But if you don’t, you shouldn’t be beaten or guilted into submission.
Recently, a reader contacted me after realizing she’d been sold a third- party warranty on a brand- new SUV she bought. She misunderstood what it really was, she told me. After she outlined what had happened, I saw why. While the warranty on her new car was excellent, she was informed it wasn’t ‘ bumper to bumper.’ It was.
The salesperson began outlining scenarios that could prove to be precarious: if the backup camera was damaged, it would cost her $ 6,000 to fix, she was told. I told her if something was faulty, it would be covered. If she sustained damage, that would be an insurance issue. And the camera was just one example in a long list of fear- based nonsense with which she was assaulted. None of it in writing, all enough to make her not only second- guess all the research she had done, but to also suck the joy out of the entire purchase.
Fortunately, the same salesperson had screwed up a number on the contract, which delayed the final approval. In the interim, we found a 30- day escape clause buried in the fine ( or, finer) print.
Turk, the APA lawyer, steered her through the process. I warned her it wasn’t enough to send an email cancelling the clause; she needed proof they had received it. Turk told her they wouldn’t rework the numbers on the final contact, but instead would probably refund that portion via a cheque.
What took seconds to do will take a few months to undo, and she’s one of the lucky ones.
A new car purchase is essentially two halves of a transaction. First, there is choosing the car itself, which seems pretty obvious. It takes a lot of work to make sure you’re buying the best car for your needs both now and a few years from now. It is reasonable to assume the bulk of your homework should take place here. The other side of the equation happens after you’ve sorted out what to buy.
“Let’s just go draw this up!” you are told. You can see the exclamation point. It’s a relief, actually.
You’ve finally navigated the reviews, the advertising, the incentives and your brotherinlaw’s advice and found the perfect car.
But all of a sudden, that warranty your salesperson was telling you was one of the best in the industry — you know, to make you want to buy the car — has become one only a fool would trust.
There are times when extended warranties make sense and you should already know if this particular car or your particular driving lifestyle requires it. Period. Decide ahead of time what path you’ll choose for rust proofing or undercoating ( if you’re not sure of the difference, get back to Google). Is the factory warranty for this long enough for you? Could you be having it done yourself for a fraction of the cost? ( Yes). Fabric protection might be good if you’re a slob, but you should know that you can apply any of those products yourself. If you don’t want to, sure, let them. And know that if you have the upholstery cleaned, it removes that protection.
I’m not against salespeople and dealers receiving a fair price for fair work. Anyone who bludgeons a dealer and expects to have an ongoing relationship with them is an idiot. But likewise, any dealer who upsells a customer to the point they’re questioning the entire brand is deserving of every negative stereotype the auto industry pretends they’ve evolved away from. When you sign that contract, you don’t have a cooling- off period.
The final word goes to Turk: “I just wish they’d call us before they buy instead of after.”
A salesman will call it “closing a deal,” but I liken it to that moment a calf falls over and gets its legs tied together.