|
Purchasing a
new or used automobile is a major investment for the
average American today. Not only is there the initial cost
of the automobile itself to consider. In a commuter
society, reliable transportation is a key factor to
financial prosperity for most Americans. Many of us depend
on our cars to get to the places where we can earn more
money, so that we can not only pay off the car loan, but
also the car insurance, the mortgage, the credit card, and
the household bills. Having a dependable vehicle is as
central as ever to the way most Americans earn their daily
bread.
The last
thing an auto buyer should expect after buying a new or
used car are problems that result from auto fraud, which
occurs when the seller of the vehicle either fails to
disclose the complete history of the car you are buying,
or alters or destroys evidence pertaining to any part of
the vehicle's age, condition or inherent or acquired
defects. Auto fraud can come in a variety of forms when
purchasing a used car. Odometer rollbacks, salvage or
flood vehicles, yo-yo sales, credit consolidation sales,
and resale of damaged vehicles without full disclosure are
all examples of auto fraud.
SIX QUICK
STEPS TO AVOID AUTO FRAUD:
Tip 1:
Make friends with a mechanic
A mechanic
can be your best friend when it comes time to purchase a
car. More than anybody else, a good and experienced
mechanic can tell you the specific problems to watch out
for when buying a particular brand or model of a car, and
can also tell you which cars are relatively hassle-free.
Based on what type of car you are looking for, your needs
for the car could widely vary. Once you know the type of
vehicle you want, twenty minutes talking to a friendly
mechanic can help you determine the best manufacturer.
Tip 2:
Arrange for financing through your bank or credit union
Whenever
possible, you'll want to seek financing approval from your
bank or credit union before shopping for your car. Banks
almost always offer a substantially lower rate than what a
used car dealership will offer. If you have a prior
lending history with your bank and are in good standing,
you can usually receive up to 90 per cent financing. Car
dealerships make huge profits by providing their own
financing to auto buyers, so they want you to borrow from
them. By securing an auto loan through your bank for an
amount you can afford before purchasing a car, you'll find
yourself in far more control when negotiating a final
price.
Tip 3:
Ask for a copy of the warranty, take it home and read it
Many used car
dealers are notorious for providing "dealer warranties."
While the big print in these documents promises
comprehensive coverage and prompt service for the vehicle
you buy, it is the small print that dealers refer to when
something actually does go wrong with your car. The phrase
"wear and tear items not included" is a common one in
dealer warranties, and one you will hear over and over
again if your car begins to have problems.
Remember that
car dealers are always trying to increase the final sales
cost of your car through add-ons and features. A dealer
warranty is often pitched as a vital add-on by the car
salesperson, but unfortunately, when push comes to shove
the true value of the warranty is sometimes questionable.
Make sure you clarify exactly what is covered with the car
salesman. If your concerns are not explicitly answered in
the warranty, ask for a signed, authorized amendment from
the dealer with the correct wording that you are seeking.
Tip 4: If
necessary, amend the warranty to protect yourself from
Lemon fraud
After you
have satisfied yourself that you are getting adequate
repair and maintenance coverage for the price of your
warranty, you'll want to make sure the following
statements are somewhere on the warranty:
"THIS CAR HAS
NOT BEEN RETURNED TO A DEALER OR MANUFACTURER BECAUSE OF
LEMON LAW DEFECTS OR COMPLAINTS."
"THIS CAR HAS BEEN INSPECTED FOR COLLISION DAMAGE AND
COLLISION REPAIRS AND HAS BEEN FOUND TO BE FREE OF
COLLISION DAMAGE OR REPAIRS."
If these
statements aren't on the warranty, insist that they be
added, acknowledged and signed by an authorized
representative of the dealership.
Tip 5:
Take it for a long spin
Leave a copy
of your driver's license with the dealer and take the car
out for a while. Drive the car in multiple road
conditions: city streets with heavy traffic, highways with
open spaces, straight and curvy roads, and hills. Test the
brakes, steering, features, air conditioning and gauges.
If you can arrange it, pick up your new friend the
mechanic and bring his highly trained ear along for the
ride. Let him take a look under the hood. If he likes what
he sees, and you have faith in his judgment, then you are
probably in good shape.
Tip 6:
Don't be in a rush
Above all
else, don't let a car salesman rush or cajole you into a
one-day, stop and shop sale. Avoid impulse buying. It is
to the salesman's benefit, and only his benefit, if the
sale happens quickly. It is to your benefit to do as much
research as possible to insure you purchase a safe and
reliable vehicle. You should be prepared to spend at least
two weeks doing adequate research before making a used car
purchase.
Lemon Law
State lemon
laws have been created to protect consumers when they have
purchased a defective vehicle. Typically, a lemon law
requires a manufacturer to provide a refund or replacement
for a defective new vehicle that is not repaired within a
reasonable number of attempts. Most such laws provide for
refund or replacement when a substantial defect cannot be
fixed in 4 tries, a safety defect within 2 tries or the
auto is out of service for 30 days, within the first
12-18,000 miles/12-24 months.
Beyond state
lemon laws, a consumer has the right to a refund or
replacement of a lemon vehicle under the Uniform
Commercial Code (UCC). The main difference is the UCC law
does not define a lemon so it's up to a court to decide if
an auto company must give you a refund or or a new car.
The federal Magnuson-Moss Warranty Act provides for the
award of attorney fees from the manufacturer if you have
to sue to return a lemon under the UCC. Many state lemon
laws also provide for attorney fees.
Practical
Tips for Using Lemon Laws
Success in
using state lemon laws depends upon keeping good records
and providing the right notice to your vehicle’s
manufacturer:
Repair
Record: Keep close track of the number of repair
attempts and the time the car is out of service. Submit a
written, dated list of problems to the dealer each time
the car is in for repairs (keep a copy). List the symptoms
your car has; for example, "stalling" instead of "check
carburetor." This establishes a record of what problem was
addressed even though the dealer may work on different
parts in attempting to fix the problem. Insist on getting
a copy of the repair order that lists the symptoms
described, repairs done, any parts replaced, and the time
the car was in the repair shop.
Notice
Required: You must follow your state's notice
requirement before you are entitled to a refund or
replacement. Where written notice to the manufacturer is
required, send a certified, return receipt letter stating
your vehicle's need for repair to the manufacturer's
consumer relations office and to the nearest zone/regional
office listed in your owner's manual or warranty booklet.
Make sure you send this notice by the time you take the
car in for the repair attempt that qualifies it as a
lemon. Give the dealer a copy of this letter when you
deliver the car for repair; keep a copy.
Your
Refund Or Replacement: After you believe your vehicle
qualifies as a lemon and you have followed the above
steps, ask the manufacturer for a refund or replacement.
You may have to pay a small offset for use of the car but
no more than for the mileage up until the first repair
attempt which qualified you for the lemon law. If the
manufacturer has a valid arbitration program that is
incorporated into your written warranty, you may be
required to go through arbitration to get your refund or
replacement. |
