Alabama Auto Fraud Lawyer Judson E. Crump
It’s no secret that automobile dealers are some of the shadiest businesses around. Unlike banks, they’re loosely regulated, less likely to have permanent locations, staff, and assets, and dominated by a profits-first mentality that not only tolerates ripping people off and lying to them, but actually encourages it. To make matters worse, arbitration clauses are almost always upheld in auto sales contracts, so many of the worst offenses never see a jury. But that doesn’t mean that when you’ve been screwed by a shady car dealer that you have to take it sitting down. You can fight back, but you must be proactive.
Auto fraud can take a number of forms:
“Spot Delivery” scams
You go car shopping. You buy a car, sign the paperwork, and drive away in your new ride. Then a few days, or a few weeks later, you get a call from the dealership. They say that your financing didn’t go through and you have to bring the car back. This can be illegal. And they can never force you to agree to a higher payment than you’d originally bargained for. And they CANNOT KEEP YOUR DOWN PAYMENT.
Inflated Purchase Price
You look at a car with a window sticker that shows a price of $10,000. You negotiate to buy the vehicle, then after they run your credit, the price on the paperwork is suddenly $12,000. This could be a hidden finance charge that violates the Truth in Lending Act.
Running your Credit without your permission
If you go to a dealership and they get your driver’s license and take it to a guy sitting at computer and then chat for a few minutes before letting you look at any actual vehicles, they may be checking your credit. They can’t do that. If you have not given them permission to run your credit report or actually applied for financing, then they cannot run your credit.
Denying your loan application without a written explanation
The Equal Credit Opportunity Act and the Fair Credit Reporting Act require that they notify you when you’ve been denied credit, and that they tell you why. If the dealership handles more than 150 credit applications a year (only the tiniest dealers don’t), they have to give you a written explanation of why you were denied credit.
Falsifying your loan application
If you submit your financial info to apply for a car loan, and then later find out that the dealer had submitted different information, they’re committing bank fraud and violating the Credit Repair Organizations Act.
Not Giving You Clear Title When You’ve Paid them in Full
Perhaps the most painful form of car dealer fraud is when you’ve bought a vehicle, made payments for years, and finally paid everything off, only to find years later that the dealer who sold you the vehicle never owned it in the first place. Yes, this actually happens. In Alabama, once you’ve made your last payment, you have the right to request a title certificate. They have 15 days to give it to you.
Selling Vehicles They Don’t Even Own
Believe it or not, this actually happens more often than you’d think. In just the first few months of 2015, I took on three separate clients who signed sales contracts, made down payments or trade-ins, and thought they were buying a vehicle – only to find out months later that the car they’d been sold had not even been owned by the dealer at the time of the sale. Sometimes there is a lien on the automobile that the dealer never paid off. Other times, the dealer just flat-out doesn’t own the vehicle, and God only knows how it got onto their lot. But as common sense dictates, you just can’t sell a vehicle that isn’t rightfully yours to begin with. Unfortunately, this sort of scam happens every day to unsuspecting customers.
Here’s a video where I discuss some of the more common auto dealer schemes, frauds, and scams I’ve seen in the past year or so: