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April 2013 Archives

Who would have guessed it - forgery by car dealerships is BAD!!

Some things should be obvious.  But, apparently, a columnist in car dealer publication Automotive News felt that car dealerships need to be told that: "Signing a customer's name is forgery.  Period."  Check out the article, which suggests that the reasons for forgery are somewhat benign.  Our experience with car dealer forgeries suggest that there is frequently a more sinister motive.We have handled several cases where a consumer signed a contract at the dealership and later discovered that a completely different contract - with a forged signature - had been assigned to a bank or finance company.  In some cases, the terms were the same, but in others, the terms were different. Sometimes, those differences do not favor the consumer.  In a few instances, it appears that someone at the dealership figured out how to juggle the numbers to make more profit.  In other instances, the dealership had trouble assigning the contract to a bank and changed the terms to get approval.  For example, if a bank determines that the interest rate used in the contract was too high, the dealership might increase the purchase price or add "extras" that the consumer never received.  Although the payments might stay the same (or about the same), the consumer will lose out if they want to trade-in, refinance, or pay-off the loan early.How can a consumer tell if there is a forged contract?  Check the account statement from the bank and compare it to the finance contract.  If there is a difference, however small, call the bank and ask it to send you a copy of your retail installment contract.Car dealers shouldn't need a columnist to tell them that signing a customer's name is forgery. It is also wrong. And, it is quite common.

Buying a decent car with poor credit

Buying a decent car without good credit can be tough.  In Connecticut, car dealers can charge up to 19% interest.  All too often, dealers charge prices are well above book values, and that is before the cost of conveyance fees and other "extras" are added to the price.  Consumers without good credit frequently wind up paying too much for cars of questionable quality. Our clients frequently ask us what they can do to get a decent car at a fair price.  Our advice is    to avoid the "easy credit" dealers and to purchase from a private seller.  We know that it can be difficult to come up with the cash to purchase a car, but if you can can get by without buying a car and set aside the amount that would otherwise go to monthly payments, in less than a year, you can save several thousand dollars.  That might be enough to buy a car that would cost much more at a dealership.  Private sellers usually are willing to sell for somewhere between the book "trade-in" value and the retail value, which is quite a bit less than what most "easy credit" dealerships charge for cars.  Look for cars that are recommended by Consumer Reports as being reliable.  The most important tip of all is not to buy a car without having it inspected first by a mechanic that you know and trust. When looking to purchase a car from a private seller, beware the "curbsiding" scam. If a car is REALLY bad, most dealers will not want to put them on the lot.  Many of those cars wind up in the hands of unscrupulous people who will pretend to be private sellers.   Do not be shy about asking for the seller's identification to confirm that the person you are dealing with is the actual owner of the car. You can get a serviceable car at an affordable price if you avoid the curbstoners and get an independent inspection.  While this may not be the car of your dreams, you can "upgrade" soon enough by continuing to set aside the amount that would otherwise go for car payments.

Our Auto Dealer Fraud Practice and Representative Cases

 
In our experience, consumers have more problems involving motor vehicles than with any other type of purchase.  State and federal laws provide consumers who lease or purchase motor vehicles with many protections, and an alarming percentage of motor vehicle sales or leases violate those laws.  In most cases, a consumer who successfully brings suit under these laws can obtain a court order requiring the dealership or the finance company to pay the consumer's attorney's fees.
  Consumer Law Group has handled hundreds of cases involving auto dealer fraud or violations of credit disclosure requierments.  Although our past successes in no way guarantee that a similar result could be obtained in other matters, our representative cases include:
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Krack v. Action Motors Corp. - An auto dealership sold the plaintiff a used sport utility vehicle that had previously had a salvaged title.  The consumer initially brought the action in small claims court, where the most she could have obtained was $3,500.  The dealership transferred the case to the regular docket, and the consumer retained Consumer Law Group to handle her claim.  Following a trial, the court awarded the plaintiff over $9,000-- the difference in value between the amount paid for the SUV and its fair market value, plus all of her attorney's fees.  
Benham v. Wallingford Auto Park - The dealership advertised that if a customer was not satisfied with their vehicle, they could exchange it for another car.  The consumer attempted to exchange a car but was told that she could receive only the trade-in value rather than the amount that she had paid for the vehicle.  The consumer returned the car to the dealership and sued to recover her money.  Following a trial, the court awarded the consumer $5,000-- the amount that she had paid to the dealership-- plus $35,000 in punitive damages, plus attorney's fees.  
In re Shoreline Motors Corp. - Consumer Law Group mediated and settled the claims of more than 120 consumers who had purchased vehicles from a dealership that was convicted in federal court along with multiple employees.  
Drayton v. New Britain Auto Sales - A consumer prevailed in an arbitration against a dealership that had violated federal law by not properly disclosing the finance terms in a motor vehicle sale.  The consumer was awarded a return of all amounts paid for the vehicle plus $1,000 for violating federal credit disclosure law and attorney's fees despite his use of the vehicle for more than a year.  
Tirado v. James Motor Cars - A consumer brought suit against a car dealership and motor finance company for not properly disclosing the finance terms for a contract and for refusing to repair when it broke down after one week.  Following a trial, the court awarded a return of the purchae price, $5,000 in punitive damages, $1,000 for violating federal credit disclosure law, and attorney's fees.  
Consumer Law Group has also settled hundreds of cases against auto dealerships and finance companies for violating various consumer protection laws, and it has assisted hundreds of its clients in cancelling their motor vehicle contracts.

Trans Union Now Considering Metropolitan Area When Evaluating Credit Risk

Trans Union is now using "metro ratings" to evaluate credit risks for collective groups based on where they live.  Attorney Chris Kittell of the Kittell Law Firm writes
Trans Union contends that a low metro rating does not just reflect a geographically localized group of lackluster bill payers, but could indicate places where the unemployment rate is high or that were hit hard by home foreclosures.
Read Attorney Kittell's full article Now whether your neighbor pays his bills affects your credit score?! which includes a summary of how the new ratings work and a list of the worst metro scores. 

Dealing With New Car Warranties: Part 2

Good Morning! If you've been following our blog, you might know from yesterday's post that Attorney Dan Blinn bought a brand new car over the weekend and that, less than 24 hours later, the car wouldn't start.  Yesterday's post detailed some of the things that we recommend for consumers to do if they find themselves in a similar situation. Dan's car is back and running for now but, when he returned to the dealership, the service record did not accurately or completely describe the problem. So, before any problems reoccur, Dan will write a letter to the service manager and clarify what happened to the car.   That way, there will be a record of the problem, which will make it easier to establish a lemon law claim. More information on New Car Warranties and the Connecticut Lemon Law.

It Can Happen To Anyone: Dealing with New Car Warranty Issues

It can happen to anyone - CLG attorney Dan Blinn bought a new car this weekend and, less than 24 hours later, it wouldn't start.   So, he follows the advice that he gives to clients facing similar situations involving new car warranty problems:
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      1.  Promptly notify the dealer;
      2.  Start a log of all problems, communications, and costs;
      3.  Make sure the dealership accurately records the problem on all repair orders, and request and retain copies; and
     4. If not repaired after second attempt,  call the manufacturer's customer service representative (whose number is in the consumer warranty information booklet).
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The lemon law kicks in if a manufacturer can't repair a defect in a new car after being given a reasonable opportunity to do so  (usually 4 attempts or out of service for 30 days). If a car isn't repaired by then, call a lawyer for advice BEFORE taking the car back for another repair attempt.
 ...
We hope that Dan's situation is resolved quickly.  If not, he'll be in a good position to make the manufacturer either repurchase or replace the car.

Cell Phone Calls, Debt Collectors and the Telephone Consumer Protection Act

Many consumers have told us that they get several calls a day on their cell phones from a debt collector or creditor who is trying to collect a debt.  Collection calls to cell phones can be particularly frustrating because most consumers always keep their cell phones with them.  As a consequence, these consumers may find their cell phone ringing during business meetings, job interviews and important family functions.  What can be even more frustrating for consumers is answering the call only to discover that there is nobody else on the line.  We've heard about consumers who have had to say "Hello? Hello? Hello?" many times before they're connected with an operator.  For others, they're greeted by a machine or hung up on.

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