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Clark Howard's Tips

Car financing on your own more important than ever

November 30, 2004

A few months ago, Clark talked about a case that was winding its way to the Supreme Court and could affect you. It involves impropriety among banks and car dealers when consumers buy cars.

By a ruling of 8 to 1, the high court decided that Congress created the Truth in Lending Act to benefit dealerships, not consumers. Essentially, it means that a dealership can cheat you in the finance department on your loan and it's perfectly legal.

And it's not just for car loans. It's for any personal property loan. The court also said that Congress will have to change the law if it wants the law to be interpreted differently.

In the meantime, it is now more important than ever to arrange your financing in advance when you're buying a new or used car. Then, if the car dealer can beat your pre-arranged finance deal, great. But if you go to the dealership first, the salespeople will try to make as much money from you as possible.

You can also write to your senators and representatives and tell them how you feel about this travesty. Only they can right this wrong, so let them know about it!

Consumer advice courtesy of