Car dealerships unfairly boost their profits by packing the contract. Packing is when a car dealership tells a consumer that they have to buy extras like a service contract, GAP, or some other extra if they want to get approved for financing.
Some dealerships lure consumers to their showrooms by advertising cars at low prices. But, once the consumer tries to buy the car, they may find that the low price is offset by overpriced extras. For example, we recently saw a dealership require a consumer to buy a package for future oil changes for $1,500. That's enough to pay for oil changes for 25 years for most vehicles!
Frequently, the dealership will just add these extras to the contract, hoping that the consumer won't notice. If the consumer objects, then the dealer might claim that the extra is required by "the bank." This is almost certainly a lie.
Dealerships guilty of Packing may violate laws regarding unfair trade practices or truth in lending when they make consumers buy unwanted extras as a condition of buying or financing a car, truck, or SUV. Consumers can recover up to $2,000 for truth in lending claims, and dealerships that violate unfair trade practice laws may be liable for punitive damages. The dealership may also be responsible to pay attorney's fees.
How to protect yourself: Look over your contract papers carefully BEFORE SIGNING to make certain there isn't anytihng included that you did not request. If a dealership claims that a bank requires extras like a service contract, GAP, VIN Etching, or some other added service, ask them to confirm that in writing so that you will have proof. If the dealership refuses, walk away - you are being scammed. If you were forced to buy extras in order to buy or finance a vehicle purchase, you should contact an attorney. Courts have held that this is an unfair trade practice.