Yo-Yo Scams and the NC Lemon Law

Imagine driving your new car off the lot, taking it for a spin, and showing it off to all of your friends, only to get a call a couple days later from the dealership regarding some "discrepancies in your financing."
The next thing you know, the deal you thought you had agreed to has collapsed, and all of a sudden you find yourself looking at a higher interest rate, being pressured to buy additional insurance, or something along those lines.

Here's what so many people don't realize--if you drive a new car off the lot before the lender has approved financing, you could be the one getting that dreaded call. If you are on the receiving end of such an injustice, there is a pretty good chance you're being set up for what's called a yo-yo scam. Driving a car off the lot before receiving final approval of financing arrangements is called "spot delivery." This term refers to the dealer putting the customer in a vehicle "on the spot" in order to secure the sale, only to "yo-yo" them back in later to try to get more money by renegotiating the original loan agreement.

Most people don't know to do anything other than what the dealer tells them, which is why consumers fall victim to yo-yo scams on a daily basis. Just because you've negotiated the deal already doesn't mean it has been sealed on the financial end. If a yo-yo scam happens to you, don't simply return to the dealership and renegotiate on the dealer's terms. First, find out what the options are and what, if anything, the "discrepancies" will cost you. Next, ask the dealer for the name, number and address of the lender that supposedly rejected the financing. Go back and read your agreement thoroughly to see if it says anything about what happens when financing falls through. Remember, if your financing was truly rejected, you have a right to speak to the lender about it. If you can't get that information, contact the office of your state's Attorney General, or an attorney specializing in lemon law, North Carolina or wherever you may be.

Now keep in mind that the dealer may have you sign a contingency clause stating that you were allowed to drive the car while awaiting financing approval from the lender. The dealer can take the car back if financing isn't approved. And in fact, this might be your best option. Even if a dealer claims that you can't bring the vehicle back, you may be within your rights to do so, as long as financing hasn't gone through. Many times the finance office will state that you must go through with the deal at a higher monthly payment or interest rate than what was originally negotiated. Exercise extreme caution under such circumstances, and contact a North Carolina lemon law office for an explanation of your rights.
Written by Penelope Holiday. Learn about the North Carolina lemon law. Find out if you have an Asheville Lemon Law case. Get a free quote and more info from your lemon law attorney, Asheville NC: Sean Soboleski at http://www.nclemonlawattorney.com