Fraud by auto dealers and other sellers can take many forms. All of them can leave a consumer with a vehicle that’s not what was represented to them. For example, the seller may have turned back the odometer or failed to disclose the vehicle’s accident history.
These in themselves can cause financial loss. You may be driving a car that’s not going to last as long as you think it will or have serious problems that will need repair. There may have been recall fixes that weren’t made. However, the financial costs may not stop there.
Car insurance
While your insurance rates are typically based on your driving record, who is driving your car and where you live, if you’re unknowingly driving a car that isn’t in the condition you believed – even if it’s not a “lemon” – you could be more likely to get into an accident.
That could significantly raise your rates because the accident would likely be deemed at least partially your fault. For example, the brakes might fail to work or a tire might blow out.
Car loans
Some types of dealer fraud involve financing. Dealers, of course, make more money if consumers get their financing through them rather than go to a financial institution. There’s nothing wrong with getting financing through the dealer if they’re offering the best terms and they’re honest about them. However, dishonest dealers use unscrupulous techniques to get customers to pay much higher rates than they signed up for (or thought they did).
A common scam is called “yo-yo financing.” This is when the salesperson offers an auto loan at a low rate, which is stated on the documents you sign. Then they call you days or weeks later to say you didn’t qualify for that rate and either need to take a higher one or return the car.
By then, you may have sold your other car or simply become used your new one and not want to return it. That’s what they’re counting on. Therefore, you’re stuck paying a higher rate than if you’d gone to your bank or credit union.
These additional financial losses are important to keep in mind if you file a lawsuit against a dealer for fraud. You have every right to seek compensation to cover them. The same may be true for medical bills and other expenses connected with an accident or other event caused by a vehicle where the age, history and/or condition were misrepresented. To help ensure that you get the compensation to which you’re entitled in an auto fraud claim, it’s crucial to have experienced legal guidance.