Critical Scam Alert

Yo-Yo Financing

Also known as "Spot Delivery." It's the most dangerous post-sale scam because it happens after you think you've bought the car.

How It Works

The Simple Version

You sign paperwork and drive the car home. Days later, the dealer calls claiming financing 'fell through' (your car loan wasn't approved) and asks you to come back. The new deal is often worse—higher APR (interest rate, the cost of borrowing money), more money down (upfront cash), or additional fees—unless you push back.

Here is the legal trap: Buried in the stack of papers you signed is a form often called a "Spot Delivery Agreement" or "Bailment Agreement."

This document basically says: "You are taking the car today, but the deal isn't technically done until the bank fully approves the loan."

The Scam: Unethical dealers know your credit score is borderline. They let you take the car anyway (Spot Delivery) to get you emotionally attached. They might not even submit the paperwork to the bank for a few days.

When they call you back, they have leverage. You've already shown the car to your friends. You may have already sold your old trade-in. They use this pressure to push you into a higher interest rate, more money down, or additional fees.

Warning: Some dealers use aggressive threats (like reporting the car "stolen" or sending a tow truck). Laws and contracts vary by state, but don't ignore these calls. Get everything in writing and consider contacting your lender and your state's consumer protection office if you feel pressured or misled.

Immediate Action

How to Protect Yourself

Rule #1: Verify Approval

Before you drive off, ask to see the "Loan Approval Notice" from the bank. If they can't show it, it's a Spot Delivery. Do not take the car.

Rule #2: Use Your Own Bank

If you walk in with outside financing ready (or a true pre-approval), this scam is much harder to run because you’re not relying on dealer-arranged financing.

Avoid Bad Deals From the Start

Dealers who run yo-yo scams often create chaos and pressure. Before you commit to any vehicle, run the VIN to check for title brands/total-loss history, theft flags, and odometer issues (coverage varies by provider).

Check Vehicle History

Sources & Further Reading

Notes: Sources are provided for general education. Rules can vary by state and change over time.

What's Next?

The Deposit Lock

Another trap that locks you in

Battle Plans

Step-by-step buying guides

Negotiation Scripts

What to say when they call you back

Calculators

Verify their numbers