HOW TO IDENTIFY AND DEFEAT TRICKS USED BY UNSCRUPULOUS SELLERS
Most RV Dealers are honest folks that simply want to earn their living selling products they love. They always strive to be in compliance with the rules, treat their customer, as they would like to be treated, and provide value to the consumer. Unfortunately there are those that work differently. They try to gain advantage through deceit and unfair tactics. Hopefully we can shed light on some of their tactics so you can avoid them and the heartache they cause.
We Beat All Prices • If you search long and hard enough, if you travel far enough, eventually, somehow, somewhere, someone will give you a better price. But will you get a better value? The question to ask yourself is: “What am I giving up? What’s missing?”
There is no magic. A better price almost always means a shortcut must be taken…something must be left out. So, before you let a better price get you excited, be sure you know what you’re trading for it. You’re probably giving up more than you think. Remember: No product is any better than the dealer you buy it from.
The Storyteller • Most RVers buy the story as much or more than the RV. This is especially true with private sellers, gypsy dealers, and “curb-stoners”. It can also be true with ordinary RV sellers. The old tale from the car industry of the car owned by the “…little old lady who only drove it on Sundays…” is a perfect example of a story. The stories need not be fabrications to be misleading. Even if they are 100% true, as many are, a story can fuel your belief that this is a special deal.
Always try to keep emotion out of your decision. Work on the facts. Be sure the story adds real value to the RV. Be sure the story is an actual asset to ownership for YOU! Use the NADA Guide to confirm values, also available at nadaguides.com.
The “Low-Ball” Price • This a favorite tactic used to throw a price shopper off course. It goes something like this: a buyer is shopping for an RV. He makes it clear that he is not buying today and that price is a primary consideration. Since they are sure the buyer is not buying today, the salesperson or sales management gives the buyer a price they know to be impossible. The dealer is hoping that the buyer will not find a better deal anywhere and come back at the end of his shopping cycle to buy. At that time the price will no longer be available, or a “mistake” will have been made, or some other problem will make the original quote impossible. The dealer is hoping that he is tired of shopping and is now educated about what is possible elsewhere, so they will sell him at the highest possible price. In the end the buyer saves little or nothing.
Always be skeptical of prices far different than those you get from most sellers. Remember there is no “magic!” Something must be different to make a big difference in the pricing. Be sure to review the section coming up on buy-backs and problem RVs as well (many times this is the magic).
The “High-Ball” Trade Value • This tactic is similar to the low-ball price strategy. A “high-ball” trade value is an inflated value given in an effort to be the last dealer you shop. Typically, the dealer will NOT do a detailed appraisal. Rather they will just throw out a number higher than they will actually give. The hope is that no other seller will give as high a trade value. You will go and do all your shopping and then return to take advantage of the deal, only to find the trade value is actually lower once they do a detailed appraisal or find some other problem. Internet sellers commonly use the tactic. Imagine your position once you have driven many hours and perhaps thousands of miles only to find out the deal you have is not what you thought. These sellers are betting you will accept a much lower trade value rather than make the trip for nothing. You are pretty much at their mercy.
If you do not have a detailed written appraisal and a written agreement on the trade value committing the seller as long as the trade is as it is represented, you ARE very vulnerable to this tactic. Having the agreement in writing protects both parties to the deal. Do not let the seller “wing it”. Make the seller spell out the agreement, including any issue that may change the value and insist on getting it in writing.
Another variation uses a switch to a glitz product (see “The Switch” in the next section) priced far above its real value with an inflated starting price. That enables the dealer to show you a much higher trade value. In reality you’re still getting a cheaper RV but you were fooled into thinking you got a better RV and a better trade value.
Always use the NADA Guide or nadaguides.com to help establish values and do comparisons to be sure any model the seller is trying to sell you is truly in the same class as the others you’re considering.
The Switch • Often dealers will try to switch you to a different model that is “just as good” for less or “even better” for the same price. Often these are glitz products inferior to the model you were originally interested in. This model usually looks better or has more features at first glance. It is designed to have “eye” appeal. The differences are in what you don’t see. One of the biggest differences is the dealer’s cost. He is switching you to increase his profit margin by selling you a cheaper product. Some dealers will inflate MSRP prices to make deals and discounts or trades seem more attractive.
Always compare NADA Guide values. Do comparisons to be sure it is a peer product to others you’re interested in. Do a detailed structural walk-around to identify the quality of materials and workmanship. Don’t switch until you’re sure you’re comparing to an equal product.
A more egregious form of “The Switch” tactic involves having you negotiate and agree upon a particular RV and then documenting all the signed forms and paperwork with the wrong Vehicle Identification Number (VIN). The VIN used will be a model with a lower cost and usually fewer amenities. Imagine disputing a raft of documents you have signed agreeing to the purchase and the sales staff all singing the same tune: “You must be confused. This is the RV you negotiated on and agreed to purchase. All the numbers match. You must be confused. We did look at a lot of RVs that day.”
Trust but verify. Be sure the VIN matches the actual RV you want to purchase. Always have a detailed list of the features included in your deal in writing.
Let’s Just Check To See If You Qualify • This ploy involves getting you to sign a number of documents with the idea being we are just checking to see if you qualify. The representative will assure you verbally that they are just checking your credit and they simply need these forms signed to do so. However you are actually asked to sign the following: Sales Agreement; Credit Application; Bank Installment Loan Contract and Storage Agreement. There is also a statement that states only if the loan is NOT approved are all the documents invalid. If you are approved – you own the RV, regardless of what they have said or promised verbally.
Never sign a blank document. Be sure you read and understand any document you sign. Be wary of signing anything beyond a purchase agreement and perhaps a credit application before you take possession of your new RV. Always know what you are signing.
No Posted Prices • Some pricing should be available to you. It is an important tool required to establish comparable value; to identify features and to prevent “musical pricing” which changes to fit your pocket book. A posted manufacturer’s price sticker, a dealer asking price, a spec-out price list – something. Always get an itemized list of the options and standards included in the price. It is very dangerous to work blindly, not knowing what the price is for a specific vehicle. If no prices are available, it becomes extremely important to check out the numbers you get to be sure you don’t pay too much.
Always use the NADA Book or nadaguides.com as a guide to be sure the starting price is within a reasonable range. Ask the salesperson to justify the price he is asking based on the book value. If he can’t, go elsewhere.
Gypsy Dealers • There are several manufacturers, mostly small operations, which specialize in supplying marginal RV sellers. They excel in building new vehicles as cheaply as possible. Often they are covered by useless warranties from nonexistent service facilities. They sell through very questionable sellers. These sellers will employ all the dirty tricks in the book to take advantage of you. They will tell a great hard-luck story, sell you a cheap “gypsy” brand with no support, and be gone when you go back for some recourse.
Avoid unlicensed dealers, curb-stoners and other low overhead sellers. Use the Dealer Interview Questionnaire (available at Midwest RV) to identify a reputable seller. Use the rating sheet to develop a comparison score to determine the best dealer to build a relationship with for the long haul. Make choosing a dealer as important as choosing an RV.
Low Overhead • Studies have shown that on average, as a percentage of income, low overhead dealerships run at the same expense level as a full service dealer. They must to survive. The result: some of the value is missing. This is important for you to factor in to your buying decision. Understand that you’re giving something up. Once you understand what you’re giving up, make your choice knowingly.
Don’t let a dealer fool you into thinking you can get the same level of value for a low overhead price. Know what is missing before you decide to make the deal. Compare total value – not just price.
Factory Buy-Backs, Problem Units, And Other “Deals” • Quality problems do occur. Problem RVs exist. The frequency escalates with glitz products and manufacturers. Often these RVs become available at discounted prices to dealers, as many manufacturers reduce losses and expenses by selling them rather than shipping them back and repairing them. The dealer is supposed to do the repairs in return for the discount; but many just sell the RV, pocket the discount, and hope the problems will not be discovered. Some dealers specialize in this type of RV buying & selling in order to offer extreme discounts and pricing far below those available for first quality product. Others buy them occasionally and try to fix them or offer them as “special purchase” or some other “deal.” A few refuse to buy them at all. Some of these vehicles are simply the result of buyers’ remorse and have few real problems. Unfortunately, most are real trouble and can be the source of major headaches for as long as you own them (unless they are repaired properly). Some defects are impossible to repair correctly and will always be a source of problems. Again, if a price is significantly lower than comparable RVs from one seller, be sure you are not dealing with a “special” RV. The seller is required to disclose any known defects, but since this is often hard to prove and expensive to litigate, your remedies for such a situation are not very attractive.
Your best bet is to steer clear unless you are VERY comfortable with the seller, their reputation, and their track record for customer care. Otherwise view any “special savings” with a very skeptical eye. Weigh the risks carefully. If the price seems far below the norm be very wary. This is a case where it is even more important to remember, if it looks too good to be true, it probably is!