Can A Car Dealer In Texas Raise The Price Of A Car Because Of Sub-prime Bank Fees?

Someone who was in the market for buying a used vehicle asked me, can a car dealer in Texas raise the price of a car because of sub-prime bank fees? The answer is no. Once you purchase a car and the terms of the contract is determined the car dealer can not raise the price of the car after the fact.

A car loan is not like a variable mortgage loan. The interest on most car loans are fixed, meaning it will not change during the course of the auto loan.

If you are delinquent on your payments and violate the terms of your contract, then in most states car dealers have the right to charge a late fee.

Sub-prime APR are determined by market variables, including interest rates set by the Federal Reserves. They do fluctuate, but they have no effect on the loan after the contract has been signed.

Sub-prime is a credit score below 550 – 619 on the Scorex Plus and 601 – 640 on the Vantage Score system

To prevent car dealers from taking advantage of you, get a copy of your credit report. Your FICO score determines whether or not you fall in the sub prime category and how much interest your will be charge on a car loan.

Another note, because credit unions charge less interest than banks for auto loans, visit your local credit union before talking to a car dealer