Buying a new car? Feds warn of deceptive auto ads

Buying a new car? Feds warn of deceptive auto ads
auto advertisements

auto advertisements

If you’re looking for a car, it would be wise to kick the tires on any ads that promise an unusually sweet deal.

After facing complaints from the Federal Trade Commission, several auto dealerships from around the country recently agreed to put the brakes on deceptive advertising practices that included:

• Promoting low monthly “teaser” payments when customers would eventually have to pay a higher amount.

• Advertising zero-down leases but actually requiring buyers to pay substantial fees and other costs at the time of signing.

• Claiming that consumers could buy vehicles for low monthly payments without disclosing that balloon payments as high as $10,000 would eventually be required.

When you’re in the market for a new ride, advertising can play an important role. As Jessica Rich, director of the FTC's Bureau of Consumer Protection, said in a statement about her agency’s crackdown and settlements: “Buying or leasing a car is a big deal, and car ads are an important source of information for serious shoppers. Dealers’ ads need to spell out costs and other important terms customers can count on."

If you don’t want to be taken for a ride, it’s important to do business with a reliable auto dealer. Our consumer services research team, after interviewing consumers and top-rated dealers, offers this advice to car buyers:

Find dealerships you can trust

Aim to work with an established, reputable dealer. Ask friends and family for recommendations, and consult online reviews from a trustworthy source.

Locate dealers that provide access to management, respect your individual needs and — especially in the case of used cars — offer a warranty and allow you to have a car inspected by an independent mechanic before you buy.

Ask questions and heed your instincts

Don’t assume a dealership is out to deceive you, but don’t ignore troubling signs you may encounter. Avoid a dealership that requires you to complete a credit application before you can even test-drive a car.

Above all, when it comes to advertising, use your common sense. As the old saying goes, if something seems too good to be true, it probably is.

Angie Hicks is the founder of Angie's List, the nation's most trusted resource for local consumer reviews on everything from home improvement to automotive repair. Follow Angie on Twitter @Angie_Hicks.

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The FTC warns of dealerships that offer extremely low monthly payments and leases with zero due at signing. (Photo courtesy of Angie's List member Jeremy S. of Oklahoma City, Okla.)

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