I am a victim of several of Uncle Mel's used car and financing scams in my first and only purchase from his dealership. I researched these types of activities later to understand how naive I had been, and how to protect myself in the future: First, the "Financing Fell Through" scam: I'm a 21 yr old mother, earning $9 an hour, attending school in the evening, relying on friends, coworkers, schoolmates, family and the bus to get around. This burden to the people around me would be eliminated with the receipt of my $2000 tax refund which I would use to purchase a car.
Enter Uncle Mel and Mike Rowe. I found them through an Auto Shopper ad with a picture of the car I wanted, a 1999 Dodge. The ad print read "Absolutely No Turndowns. No Credit Checks. Everyone Rides. Low Low Interest Rates. Low Payments." Finally, I would be independent. We agreed on the $7400 price. I was told that with the $2000 down payment they would have no problem getting me financing that evening, on the spot and putting me on the road. I was axious to get rolling.
After 29% interest, 6% sales tax, $600 dealer fee, doc stamps and 36 month payment schedule, I wound up with a $6500 finance agreement with Premier Auto Finance. Three weeks later, one week before my first payment was due, I received a call on my job from the dealer telling me to leave my job immediately and get into the dealer or my car would be towed before end-of-day.
When I asked for an explanation, they refused to give me one. Imagine the stress, confusion and anxiety this caused me at the workplace. At the first opportunity the job gave me to leave, I hurried the 8 miles to the dealer. I was told the original financing fell through but in-house financing is guaranteed with an additional down payment of $1000 which they would give me no more than a day and a half to bring in. If I came in with the additional down payment, my in-house financing would be for one year, 52 weekly payments at $125 per payment. After two days and my best effort, but failing to raise the $1000 or secure other financing.
Uncle Mel's and Mike Rowe repossessed my car 4 days before my first payment was due and refuse to return my initial down payment of $2000. And I'm back on the bus. When I called the finance company, I was told that if the financing had gone through that Uncle Mel would be only given a check for about $4000, not the original financed amount of $6500.
With some research and asking around, I found out that this is referred to as the "Markup" scam; therefore, making my effective interest rate double or triple the rate actually stated. If I had accepted the in-house financing, this would have been scam number three, called "Loan Bouncing."
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