Never Leave With Your New Car and No Paperwork

Jeff Ostroff Author Circle
By , Consumer Advocate, Editor-In-Chief
Published February 13, 2012 | Updated March 10, 2019

Every once in a while, our consumer advocate team receives emails from our visitors here at asking "did I just get ripped off?" Well you know if they have to ask us that question, then the answer is probably going to be yes, they got ripped off, without even needing to read their story.

This is why as consumer advocates, we created way back in 1999 to empower car buyers like you and prevent them from getting scammed by the morally challenged. Before you even step foot inside any car dealership, educate yourself first with our consumer advocate advice guide on How to buy a new car and avoid dealer scams first.

After that, be sure to read all the sections of our Car Loan Financing Tips and Scams. Don't go to buy a car until you have read both guides thoroughly or you will not be properly prepared to buy a car.

Sometimes car shoppers do some very foolish things when shopping for new cars, that have us wondering if they need to be committed to an insane asylum. One of the worst-case scenario examples that we have seen several cases of over the years is some consumers buying their new car and leaving the dealership with no paperwork or anything in writing that confirms the deal they just signed.

This Sounds like a no brainer, to make sure you get all your paperwork, right? But it's amazing how many suckers fall into this common car dealer scam; they simply don't want you to know how badly they scammed you out of a lot of money, so they make up bogus excuses why you they are not giving you the paperwork to your new car purchase.

The reason dealers pull this scam is so they can change the numbers on you, meanwhile you already drove off with the car and put miles on it, so no matter what the car dealer salespeople do to the paperwork, the car is yours and you're stuck. We got another such email from a frantic consumer on this topic and we'll talk about this car dealer scam and how to avoid this scam below.

How the Paperless Car Sale Dealer Scam Works

The dealer usually will make up some bogus excuse as to why they can't give you the paper work for your new car that you just bought from them, maybe their computer crashed, or waiting for some manager approval, or (insert any bogus excuse here). So, they promise to mail you the paperwork for your new car purchase later. Their story does not hold water at all, it does not sound remotely believable.

A Big red flag should go up on this, because if they can itemize everything they just sold you enough to collect your money, surely they can print out the invite and receipts for everything they charged you. Have you been to any fast food restaurants lately where they ask you if you want your receipt?

Giving a customer their receipt itemizing what they just purchased is standard business practice, and now some unscrupulous car salespeople want to deprive you of your basic right to have confirmation of what you just shelled out tens of thousands of dollars for, not to mention the financial debt instruments which you just obligated yourself too.

Don't forget the Truth in Lending Act requires car dealers to give you all the paperwork with specified financial terms of your car loan in writing for you to see at the time of purchase. The law forbids them from keeping you in the dark about your vehicle financing and what the terms of your auto loan are.

Sometimes the salesperson will tell you to come back tomorrow to pick up all the paperwork. The problem is by time you finally get your hands on the paperwork, you are shocked to find the terms have changed, the APR on your car loan went up, or they gave you less for your trade-in then they promised. It's one of the oldest tricks in the scheming car salesperson's book and it is still used to this day.

Case Study: Actual victim of the Paperless Car Sale scam

A car buyer and user of emailed us to say they went to a car dealer 100 miles away with a pre-approved new car finance loan check from a lender with 14% APR. Our client told us that they agreed on a deal for a new car purchase but the total out the door price was more than their pre-approval car loan check limit. That was the car buyer's first mistake, they were trying to buy more car than they were approved to purchase by their lender.

The dealer lied and said to the car shopper no problem that they were a "gold dealer" for that lender, whatever that means, probably another lie. The car salesman said they could get the loan increased from the approval amount already shown on the buyer's car loan check. That was mistake number 2, believing the scams of a lienance manager.

If a lender approves you for a certain amount of purchase price based on your credit score, that's final folks, it is now set in stone, no one is going to get that bumped up for you. Any finance manager that makes a statement that they can get the lender to up the amount that they just approved for you is just lying through his teeth.

The lie-nance manager said they made the call to the lender and everything was fine, they falsely claimed the lender agreed to bump up the amount financed to match the higher selling price of the car. He told our client they just had to do the paperwork, so the buyer went home with their new car and no paperwork at all. That was their fatal car shopping mistake.

Three hours later the crooked car dealer calls the customer back and told him the lender said no. Well wait a minute, the dealer had told the customer they had called the lender and convinced the lender to raise the amount financed on behalf of the buyer. Wow, are you as shocked as we are that the lender said no? Guess what, the dealer never even called the lender, you can bet on that, it's all part of their scam, where they tell you anything to get the car sold.

But wait, this case study gets even better from here. Two hours later still, the finance manager said they got him a deal through BMW credit for 6.5%. Sounds like a much better interest rate than the other auto loan which the buyer had, right? Not so fast. They raised the price on the car by a whopping $5,000 and said something about an interest rate buy down. Keep in mind, this really does not exist on auto loans, only on mortgages. If there was a buy down, it's the dealer doing it and charging him $5,000 for processing the car loan for him, that is illegal.

Had the buyer simply found a car within the price range of his pre-approved car loan check, he would have dodged this scam with excellence by accident. But instead, the buyer has no paperwork or odometer statement or anything at this point when he left the dealership with his new car.

The odometer papers and loan papers were not given to the buyer because the car dealer told him their "system crashed." hey, we've never heard that one before have we? But this very thoughtful and kind car dealer promised to mail them the papers! If the car salesperson tells you their system is down, tell them over your shoulder as you're leaving to call you when their system is "back up and running", and they printed out your paperwork and have it read for you to review and sign.

How to Prevent this Scam from Happening to You

The bottom line is you don't need this kind of nonsense in your life. When you go to buy something in a store, they have signs that offer to pay you money if the cashier forgets to give you your receipt. It's that important to get your receipts and paperwork. You never walk away from the electronics store without a receipt for a new TV, so why on earth would you walk out of a car dealership with a $30,000 car and no receipt? You owe it to yourself to be more thorough and demanding.

Car dealers would never have a leg to stand on with this scam without uninformed car shoppers enabling them. If all consumers simply stood their ground, put their foot down and demanded their paperwork, this scam would never be able to perpetuate, let alone get off the ground.

Any time a car dealer tries this trick on you, with this scam, or tries to send you off with your new car and no paperwork, just say no and walk out. Tell them to call you when the paperwork is 100% ready for you to sign, and that includes all the finance and Truth in Lending required paperwork.

Tell these lying salespeople to get any and all managers approval ready, and all computers back up and running before you come back to complete the deal, and don't accept any excuses for them not giving you full documentation on everything you just bought and signed for.

Even if you must drive back home 100 miles empty handed with no new car, always make sure you get it all done in one transaction, so they cannot change numbers on you pull the rug out from under you.

Now if you read the rest of, you will be ready for any trick they throw you way. Be sure to read our Top 10 Car Dealer Scams page.

Author Jeff Ostroff

About The Author: Jeff Ostroff

A lifelong consumer advocate with over 20 years of unparalleled expertise, Jeff is the Founder, CEO and Editor-In-Chief of As chief consumer advocate, he oversees a team of experts who cover all aspects of buying and selling new and used cars including leasing and financing.

For decades, Jeff has been the recognized authority on vehicle purchasing, sought out often by the media for his decades of experience and commentary, for live call-in business radio talk shows and is cited often by the press for his expertise in savvy car shopping methods and preventing consumer scams and online fraud. Jeff has been quoted in: CNN, MSNBC, Forbes, New York Times, Consumer Reports, Wall Street Journal and many more.

Jeff also has extensive experience and expertise in new car brokering and selling used cars for clients on eBay and Craigslist. Connect with Jeff via Email or on Twitter. has affiliate relationships with multiple web sites. We are paid referral fees for leads or sales generated from visitors that click on some links or fill out certain forms on this site. Please view our advertising policy page for more information.