Auto Dealer Fraud

Car and Truck Dealers must comply with state consumer protection laws, the Motor Vehicle Sales Finance Act, the Pennsylvania Code, the state “Lemon Law”, and the Uniform Commercial Code.

Under these laws, a car dealer cannot:

  • Sell you a used car without disclosing it has serious defects from a prior accident or was previously a rental car
  • Give you unfair credit terms
  • Change the credit terms after you leave the lot with your car

Car Dealer Scams

Not disclosing prior damage, such as

  • Selling a wreck rebuilt after one or more accidents
  • Selling used cars as new cars

Significant prior damage must be disclosed to you before you buy your car. You can cancel the deal and receive money damages.

Spot Delivery (Financing Fraud)

After you purchase the car, the car dealer calls and tells you:

  • Financing was not approved
  • Return to the dealership to sign new financing documents
  • New financing documents then increase the interest rate, length of the loan and/or the monthly payment.

This is fraud. Consumer laws protect car buyers from this fraud by dealers or finance companies.

False Loan Applications

Watch out for:

  • Inflated sales price with a phony down payment
  • Other debt of yours are excluded
  • Phony cash down payment they say is payable outside the contract or sometime after delivery