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“Yo-Yo” Car-Dealer Scams Rig the Game, Push Buyers into Bad Loans

Wednesday, April 4, 2012
Delvin Davis

Car dealers often target consumers with poor or no credit for yo-yo scams, a new CRL report demonstrates. "Yo-yo scams occur when a dealer leads a car buyer to believe financing is final," says CRL senior researcher Delvin Davis, author of the report, Deal or No Deal: How Yo-Yo Scams Rig the Game against Car Buyers. "The dealer lures the consumer back to the dealership, claims the financing fell through, and then pressures the consumer to agree to a new loan at a higher interest rate." For the full report go to:

The report also found that dealers involved in yo-yo scams frequently use coercive tactics to force consumers into accepting more expensive deals. Such findings correspond with previous CRL research showing that car buyers who experienced a yo-yo scam received, on average, an interest rate five percentage points higher than what someone with the same risk level would normally pay.

This report surveyed five organizations that help consumers with auto finance-related issues, who reported information gained from over 2,100 clients. Respondents reported that 27% of their clients had experienced a yo-yo scam. This latest research provides critical data on the prevalence of yo-yo scams and the tactics dealers use in the yo-yo scam to create an unfair bargaining advantage.

For more information: Kathleen Day at (202) 349-1871 or; or Ginna Green at (510) 379-5513 or