#autofraud

             A remarkable percentage of car sales involve deception, fraud or unfair conduct. The complexity of car sales combined with the “ingenuity” of auto dealers to make as much money as they can from a multi-billion dollar industry has created this prevalence of auto fraud. 

           You can’t go far in Sacramento or other cities in Northern California before you see an auto mall. There is the Sacramento Auto Mall, the Folsom Auto Mall and the Elk Grove Auto Mall to name just a few. Invariably, just beyond those big dealerships, there are smaller used car dealerships . The stiff competition between these dealers very often leads to fraudulent and deceptive practices that can bilk consumers out of their hard-earned money.

Auto Warranties & Repairs

           California consumers come home from dealerships with defective new and used vehicles much more often than they should. Fortunately, there are both federal and California laws that exist to protect consumers. Unfortunately, many folks don’t know their rights and neglect to consult an attorney. This makes it profitable for the dealers to send people off the lot with a defective car. If more consumers begin to exercise their rights, it would send a message that a salesman can understand.

Adverse Vehicle History

           Many folks from the greater Sacramento area and Northern California are defrauded each year by misrepresentation or concealment of a car’s adverse history. These types of acts include odometer tampering, sale of flooded or wrecked cars, sale of cars with a variety of title problems, misrepresentation of the number or type of prior owners, and many more. Some of these acts are unmistakable and consumers know they need to consult a lawyer. But more often, it takes a trained legal eye to analyze the facts in order to properly protect a consumer’s interests.

Yo-Yo Sales

           A yo-yo sale is a situation in which a consumer signs a contract for a car and is allowed to drive away on the promise that the dealer will arrange financing later. Then the consumer is often told that the deal “fell through” and that deal with a higher price or interest rate is now necessary. If the consumer tries to get out of the deal, the dealer often says that the trade-in car was already sold or refuses to return the down payment.

Credit Reports

           Car salesmen are people often talented in using a prospective customer’s own information against them in negotiations. Many times the dealer will pull a consumer’s credit report without the consumer’s consent. This is illegal. This is easy to detect by looking at the consumer’s credit report. In addition to unauthorized credit pulls, car dealers have been known to report incorrect information to the credit reporting agencies. This could affect a consumer’s interest rates.

           Automobile dealers have been known to use a wide variety of tactics that take advantage of less savvy Northern California consumers. Consumers should always read a contract before signing it. Perform your own calculations and, if the math doesn’t add up, don’t sign the contract. Make sure you understand all the terms, including early termination fees, allowable miles per year and wear and tear fees associated with the lease.

The Extended Auto Warranty - An extended warranty is not necessarily a bad deal. However, if you are leasing a car, you don’t own it. Since most leases are not longer than five years in duration, the warranty is often a waste of money. Some dealers will tell you that the extended warranty will increase the value of the car at the end of the lease. The rule of thumb to remember is: Don’t sign a lease that is longer than the manufacturer’s normal warranty.

Call-Back Scams - Sometimes your dealer will call you after you’ve signed the lease and tell you that there is an error in the contract. They will describe the increased costs as minimal or negligible or they may try to renegotiate the lease. Don’t be fooled: this is often simply a way to get more money from you.

The Vanishing Trade-In - This tactic happens when the dealer leaves your trade-in off the contract. This is one of the scams that you can avoid with a careful reading of the contract and doing your own math. If something is off in the contract, you don’t have to sign it.

The Clandestine Price Hike - This is another scam that can be avoided with careful contract reading and doing your own math. Here, you have negotiated a price with the dealer. After you negotiate and get a favorable price, the dealer leaves to write up the paperwork. When he returns, you sign, not noticing that the overall total or monthly payment has increased. Make you get all the important numbers and they are as they are supposed to be in the contract.

           These are just a few of the tactics that Sacramento auto dealers have been known to use. In any auto sale or lease, the dealer likely has the upper hand in negotiations. But you can even the playing field by educating yourself and reading contracts with a suspicious eye. If you think you may have fallen victim to auto fraud, consider seeking counsel from a local attorney knowledgeable in the area of auto fraud.