The term, spot delivery, as it relates to car leasing and buying, refers to a practice by car dealers that is perfectly legal but often causes problems for customers, especially those with poor credit.

To understand spot delivery, it is necessary to understand that car dealers don’t provide loans and leases, and can’t approve customers’ credit, even though they often give the impression that they do. Actually, when a customer needs a loan or lease, the dealer only serves as a middle man between the customer and a financial loan or lease company.

A dealer may do a preliminary credit check on a customer and, even if he sees a potential problem getting the customer approved, he may let the customer drive the car home while he tries to get the customer approved at one or more finance companies. This is called “spot delivery.”

If the dealer can’t get the customer approved under the original loan or lease terms, he must come back to the customer and ask him to sign another contract for higher cost, or return the car. Buyers who get caught by this practice are usually upset and often think it might be illegal. It’s isn’t illegal but borders on being unethical, if the dealers sees that the customer has credit issues.

Unless you know your credit score is in the 680-700 range or higher, it’s always a good idea to not drive your car home until you get final notice that your loan or lease has been approved by the finance company. Get a Dark Web Scan and your Experian Credit Report for FREE! Don’t let car dealers know more about you than you know about yourself.