One more reason not to buy a car from a car dealer: when you do, they force you to give up your right to sue them if they cheat you. So say good-bye to being able to take advantage of consumer protection laws.
Think a dealer wouldn’t dare roll back the odometer? Think again. They just slip a clause in your contract that says you can’t sue. Then when you find out your low-mileage car actually has over 100,000 extra miles that “disappeared” from the odometer — good luck trying to sue them under the Federal Odometer Act.
Car dealers used to face tough sanctions, including punitive damages, for ripping off consumers. But with rare exceptions, those days are gone. That’s because car dealers insert “arbitration” clauses into their contracts. Then, after you’ve been shopping, test-driving cars, and negotiating for an average of 4 hours, they shove a stack of documents across a desk and tell you to “sign here, here and here.”
What they don’t tell you is that when you sign, you are giving up your rights under state and federal consumer protection laws. So forget hauling them before a judge or jury, who can throw the book at them. Instead, if you get any hearing at all, it’s before an “arbitrator” whose company just happens to be paid by — you guessed it — the dealer.
Under rulings by the Republican majority on the U.S. Supreme Court, this is perfectly legal.
Ironically, the dealers got a special exemption from Congress that allows them to sue anyone they please. They’re free to use the courts. But you can’t.
Evidence is mounting about how biased and unfair arbitration is. Check out this new report, issued by the Consumer Financial Protection Bureau. No wonder car dealers HATE this consumer watchdog agency. It shows how rigged the game is, when you buy a car from a dealer:
Don’t end up like Jon Perz, who has been waiting over 7 years for justice, after a car dealer in San Diego sold him an unsafe car.
Be a smart shopper. Check out CARS’ car-buying tips for how to get a safe, reliable used car — without having the hassle or risk of buying from a dealer:
Happy, safe car shopping!