C.A.R.S. in the News

 
"Military borrowers pay higher costs and face greater financial risks than civilian borrowers when taking out credit to buy a car - according to a new report from the Consumer Financial Protection Bureau.

The report found service members tend to borrow larger sums, at higher interest rates over longer terms.

Rosemary Shahan, president of the Sacramento-based nonprofit Consumers for Auto Reliability and Safety, said yo-yo scams are common - where the victim signs an initial contract on good terms but then the dealer claims the financing fell through....

Last year under former President Joe Biden, the Federal Trade Commission finalized the CARS rule, which would combat dishonest sales tactics. Automakers sued and last month a federal judge put it on hold.

Shahan said the CARS rule would require dealers to tell you the price up front before you even go to the lot.

'It also has additional protections for military service members,' said Shahan. 'It prohibits car dealers from representing that they're somehow affiliated with the military, or have been approved by the military when that's not true, and would also require them to be more honest about the price of the add-ons and actually get your affirmative approval before adding them.' "

Read more: Public News Service: Report: Military service members pay more for car loans
 

 
"Starting this year, changes to California's 'lemon law' will make it harder for consumers to get a refund or a replacement vehicle.

The changes mean instead of just taking the car to the dealer for repairs, you're now going to have to formally notify the manufacturer via email or certified mail and include your name, the vehicle ID number, a summary of the problems and a demand for a refund or replacement.

Rosemary Shahan, president of the nonprofit Consumers for Auto Reliability and Safety, said if you do not take the step, you forgo lemon-law protections.

'They're going to feel like they can ignore you and refuse to fix the problem,' Shahan contended. 'Or just do a real, cheap, temporary Band-Aid kind of fix until the warranty expires, and then they'll tell you how much they want you to pay for the repair out of your own pocket.'

Gov. Gavin Newsom said he signed Assembly Bill 1755 reluctantly in order to cut down on lemon law lawsuits clogging the courts. Shahan noted lawmakers agreed to the changes only after General Motors and Ford threatened to support a ballot initiative capping attorneys fees in consumer lawsuits, something vigorously opposed by consumer attorneys, who are big political contributors....

Shahan noted the new lemon law said consumers who have negative equity, meaning they owe more on the lemon car than it is worth, can be forced to come up with the difference before the manufacturer will buy it back.

'The manufacturers will say, "Oh, we'd be happy to buy back your lemon but first you have to come up with whatever the negative equity is before you can give us clear title to the car,"' Shahan asserted. 'Most people can't afford to pay out of pocket, so they're going to be stuck with a lemon car.' "

Read more: Public News Service: New for 2025: A Weaker CA Lemon Law
 

 
"The year 2025 is shaping up to be a confusing one for Californians unlucky enough to buy a new or used car that turns out to be a clunker.

Starting Jan. 1, car buyers who purchase a faulty vehicle will have to navigate a new version of California's "lemon law" that for five decades has given consumers the right to demand car companies fix or replace defective vehicles they sell.

That is, unless lawmakers quickly pass a law that allows some of the car companies to opt out of the new requirements.

The confusion stems from a law Gov. Gavin Newsom reluctantly signed in late September, after the bill was hastily jammed through the Legislature in the waning days of the session following secret negotiations between lobbyists.

Newsom said it was important to address the problem of California's courts getting clogged with lemon law cases, even as critics said the bill significantly watered down consumer protections.

But Newsom said he signed it only after lawmakers said they'd introduce legislation next year to make the reforms voluntary for automakers....

As the Legislature sorts this out, Rosemary Shahan of Consumers for Auto Reliability and Safety said car buyers next year are going to have a tough time figuring out what to do if they drive a lemon off the lot.

'It's going to be really confusing for consumers,' she said....

...Shahan and other critics argue the changes will primarily benefit U.S. car companies, since they're the ones most commonly sued under the state's lemon law at the expense of consumers. Foreign car companies largely opposed the measure."

Read more: CalMatters: California's lemon law is changing and car buyers have fewer protections in the new year