Philadelphia Pennsylvania Consumer Protection Blog

Are you sure you purchased your vehicle?

When you visit any of Philadelphia's auto dealerships to find your next vehicle, you may intend to own it after your final loan payment. You did not intend to "rent" the vehicle for a while and then return it to the dealership as would happen in an auto lease agreement.

You went through the process of choosing a vehicle, going back and forth on the price and negotiating financing terms before driving your new vehicle off the lot. However, at some point, you discovered that you did not actually purchase the vehicle, but instead entered into a lease agreement. How did that happen? After all, that's not what you thought you agreed to and certainly isn't what you wanted.

Why is a car dealer telling me to ditch my old loan?

New cars, these days, are very expensive -- and it's almost impossible to trade in a car that you still owe on without going upside down on the next loan.

Well, some car dealerships have developed an innovative "solution," if you're willing to take a big risk: They're telling consumers to stop paying their existing car loans and ditch their old cars back to the banks that financed them so that they can afford the new car loan that they want or need.

Ford to buy back thousands of defective Fiesta, Focus vehicles

Pennsylvania owners of Ford Fiesta and Ford Focus cars could receive thousands of dollars in compensation for faulty transmissions in the vehicles. On March 5, a federal judge approved a class-action settlement that orders Ford Motor Co. to repurchase some of the affected vehicles for up to $22,000.

According to an attorney with nonprofit consumer advocacy group Public Citizen, which represented consumers in the lawsuit, the settlement agreement could cost Ford up to $500 million. In the lawsuit, Ford owners claimed that their 2011-2016 Fiesta and 2012-2016 Focus cars with dual-clutch "Powershift" transmissions were prone to "shuddering, slipping, bucking, jerking" and other problems, including premature internal wear and sudden acceleration. A July 2019 investigation by the Detroit Free Press found that the automaker knew the transmissions were faulty from the beginning but sold them anyway, leaving consumers to foot the bill for expensive repairs.

Dealing with threats of auto repossession

People in Philadelphia may be very concerned about what they can do if their car is being repossessed. No one wants to go through an auto repossession, but people who are facing this situation may benefit from understanding certain key steps that they can take to protect themselves. When people buy a car, they typically take out an auto loan. Throughout the course of that loan, the lender remains the titled owner of the vehicle until it is paid off, giving the lender the right to repossess the car if the contract terms are violated. In most cases, people may be threatened with repossession after they stop making payments on the car.

An auto lender may not provide notice before repossessing a vehicle if the person making payments is in default. Many people want to avoid repossession because it can remain on a credit report for up to seven years and negatively affect their ability to access credit. In some cases, people may be able to avoid a repossession by speaking with their lender in advance before they miss a payment. It may be possible to negotiate a later payment date, a forbearance or a deferral of a payment. Some people may refinance their loan for a longer term.

Were you tempted by a 0% interest loan for a new car?

Auto dealerships offer all kinds of deals to customers to entice them into coming down to the lot. One of the most often seen is an offer of a 0% interest auto loan. Since most individuals can't walk into a dealership and pay cash for a car, who wouldn't want an interest free loan?

Like most people, you probably immediately realize that only people with the most stellar credit would qualify for 0% interest. Perhaps you believe your credit is good enough to take advantage of the deal. The problem is that you may be in for an expensive surprise once you pick a vehicle.

What to know about rebuilt cars

When buying a used car in Pennsylvania, it can be a good idea to look at the car's title. A clean title indicates that the vehicle has not experienced any major damage. It also means that the car has not had its odometer rolled back or otherwise tampered with. Cars that have major defects will be given salvage titles, which indicates that they are not necessarily safe to drive.

If a car that once had a salvage title has been repaired, it will be given a rebuilt title. It will only receive such a title after authorities in the state where it was granted have had a chance to inspect it. Typically, cars that have been rebuilt will sell for less than those that have not experienced significant damage. However, it can be possible to purchase rebuilt cars that are just as good as they were when they were first manufactured.

How to get started when removing an error from a credit report

A study that was performed by the Federal Trade Commission indicates that a quarter of consumers have identified errors on their credit report that could negatively affect their credit. In many cases, these errors can be fixed. Pennsylvania residents may be interested in learning the steps they need to take to fix credit report errors.

There are three categories of credit report errors. They include fraudulent accounts, identity errors and inaccurate account details. Some errors are benign, while others can be damaging and lead to a denial of credit or a person having their identity stolen.

Can you recognize the signs of auto dealer fraud?

Buying a new vehicle is a significant purchase. Depending on the type of vehicle you want and the extra features, you could have a serious price tag to consider. However, if you believe you have the financial ability to purchase the vehicle of your dreams, you may feel excited about taking such a step.

Of course, you likely want to get the best deal that you can on the vehicle, and you know that the car salesperson wants to make the most money possible. As a result, you need to have your wits about you when handling this type of transaction. Though you may be a bit wary of the dealer, you may not have expected a serious issue like auto dealer fraud to take place.

Protections under the state's lemon law

Buying a new car in Pennsylvania can be exciting. However, excitement can quickly turn into frustration when one discovers that they have purchased a lemon. Like other states, Pennsylvania has a lemon law to protect consumers when they purchase malfunctioning vehicles.

A vehicle is considered to be a lemon car when it has specific types of manufacturing defects while still new. These defects continue to persist even after repairs have been attempted. A lemon car is not an older vehicle with high miles. Instead, the defects must be present when the vehicle is new and appear immediately after the initial purchase.

Car buyers continue to struggle with defective Fords

Pennsylvania car buyers are among some of many across the country who have struggled with transmission problems in Ford Focus and Fiesta cars. Some people have sold their cars or repaired them, but others continue to deal with the costly aftermath of defective vehicles. One man says that he is still making payments on a Focus after five clutch replacements that were unsuccessful. He says that he drove the car home in reverse one time due to the failed transmission and traded it in, but he still owes money on the loan that he originally took out for the vehicle.

The man said that he bought the Focus because of a promotion that promised a low-interest rate on car loans for that specific vehicle, but he soon found himself facing serious problems. Only 16,000 miles after he began driving the car, the transmission failed. He says that he contacted Ford on multiple occasions, only to be told that his vehicle was out of warranty and did not qualify for a return or repair. However, he says that Ford knew that the vehicle was defective when it sold them and argues that the attractive interest rate was meant to offload problematic vehicles.

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