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I pulled my wifes Autocheck report for her last week on a car she paid full price(28,888USD) on, charged a total of 44,500 after 3% interest.
Come to find out it has Major "Unibody/Frame Damage". The dealership Dick Hannah sold it to her knowing this damage occurred due to the auto report stating that they, "Announced at auction to have sustained structural damage". The car was used commercially until the accident in 2012. Dick Hannah is sponsored by Carfaxs' buyback guarantee and so they had one ready before the bidding of this car. Even though the aution papers stated it was in a severe wreck the carfax did not reflect this(nor that it was a Fleet vehicle). They then sold this car to her 87 days later at full price with a three year warranty.
I arrived to said stealership to ask for more info and they presented me with a new carfax that states it was used for fleet and was in an accident. That carfax received the report in 2012, days after the accident and repair occurred but did not begin reporting this accident and repair until Feb, 2015.
If she goes to Dick Hannah, she will recieve a new loan and have the left over balance from this car tacked onto it. She cannot get her money out of it in a private party sale due to these blemishes. She has been paying $52 more for her insurence due to this issue.
Here are the three reports in order of: Autocheck, Carfax on day of purchase, Carfax 3 days ago. What type of behavior would a lawyer call this? I need to resolve this issue before I can purchase my Dream W221.
Do you have this documentation?:
GUARANTEED - None of these major title problems were reported by a state Department of Motor Vehicles (DMV). If you find that any of these title problems were reported by a DMV and not included in this report, CARFAX will buy this vehicle back.
Just reviewed the document. It's not reported by DMV so likely excluded by the guaranty.
So technically Carfax can report Damages and Repairs anytime they damn well please?(in this case two years)
So Stealerships can work with carfax to target cars on the premise that they for one reason or another will not update damage or repairs until well after the car is sold, and the buyer is stuck with a car worth many thousands less that it should have been?
Who is responsible? Is this one of this things you just have to bite the +/-$20,000 bullet in loss?
EDIT: What Difference would it make is DMV reported them if it was insurence, ect.
Last edited by mercedesbenzs55; Dec 31, 2015 at 01:07 AM.
There is a State complaint form: http://www.odot.state.or.us/forms/dmv/6504.pdf
This will not recover funds for you directly. You could potentially use this ( or the threat of it ) as leverage to obtain a refund or recovery for the diminished value. It takes some specific lawyer like skills to accomplish a negotiation like this.
I would be disinclined to purchase a vehicle from this dealership. So a trade-in is not what you want.
Really, this has nothing to do with a Mercedes. But it is a unique problem.
You may need a lawyer to obtain satisfaction.
If they bought the car at auction and it was announced as dirty the dealer absolutely knew from the get go the car is bad. There are big signs above the auction desk and dirty cars are indicated as such. However since carfax was clean they decided to risk it as they bought it for 1/2 off and could (and they did) turn a tidy profit.
Carfax and autocheck sometimes are in sync some times are not and reporting can be off by couple years. Just an FYI.
The only legal questions I see are 1) Did the dealership know before the car was sold, and can you prove that? And 2)In your state does a dealer owe a statutory duty to disclose known issues that might affect future merchantability (the value when you attempt to resell it.)?
The dealerships defense, and it may be valid, was just as the information was unavailable to you at the time of sale, it was unavailable to them. If that's true they're off the hook. It appears they did know or should have known based on the auction report, so the question is if they owed a duty to disclose. Unfortunately it's not the kind of case a lawyer takes on contingency. You'd be paying hourly and that adds up quickly.
CarFax is a different story. The entire premise of their business is that they protect consumers by either exposing known merchantability issues or guaranteeing a car has none. I don't think they can induce a sale at full market value and then disclose years later a major accident that occurred before they issued the guarantee.
The problem there is the disclaimer that warns that only information that has been disclosed to CarFax appears on the report, and buyers should not rely on the report alone, but rather have an independent inspection done as well.
How does the car look and drive?
Last edited by Mike5215; Dec 31, 2015 at 09:37 AM.
It's a 4 year old Ford Explorer with 90K plus miles on it. I doubt there is much difference in what this car is worth vs one without the accident report on the carfax. I highly doubt there is a concerted effort here on the part of a large dealer like this and Carfax to screw someone out of a few bucks because of an unreported fender bender. If she paid 29K for the car not sure how she managed to pay 44.5K with 3% interest. 3% APR is like 1900 bucks over 2 years. And it does not say anywhere on the carfax that it has uni-body damage or major damage. It simply states it was in an accident and repaired. You will spend more on attorneys than you will ever get so I would just move on. It is not the catastrophic loss you seem to think it is.
So technically Carfax can report Damages and Repairs anytime they damn well please?(in this case two years)
So Stealerships can work with carfax to target cars on the premise that they for one reason or another will not update damage or repairs until well after the car is sold, and the buyer is stuck with a car worth many thousands less that it should have been?
Who is responsible? Is this one of this things you just have to bite the +/-$20,000 bullet in loss?
EDIT: What Difference would it make is DMV reported them if it was insurence, ect.
Well....the good thing is that your $20k "bite the bullet" figure is way off. Your Explorer, with your mileage, in average condition with your high miles would only be worth around $15-16k in trade-in. Perhaps it might only be worth $10-12k in trade with the now reported damage....but that's a hit of only $3-6k.
Maybe you can negotiate with the dealer for a settlement of around $6k by them giving you full avg book value and buy another car from them at a discount. It's hard to say whether they knew about the damage or not and I think you'd have a hard time proving it....even though the later report lists the damage. If you've driven it for 2+ years and didn't notice anything wrong, then the repairs were obviously done to a high standard and it shouldn't be the end of the world. IMO, to get any kind of monetary satisfaction, you may need to work with this dealership again for your next vehicle.
I agree, not seeing a $20k loss here. Mostly this is depreciation on a Ford Explorer where the original price paid was likely high since it was high mileage when purchased.
Was the frame damage fixed properly? Maybe just keep it, you have the extended warranty, just use it fully. It should be paid off fairly soon. I don't understand the additional insurance you mentioned, what would cost $52? Is this some sort of credit insurance?
Actually when you look at the carfax, it states hit while parked. No mention of airbag deployment. Although it technically had a structural repair, it may not be much of an issue in use.
As per superpop, there's no reasonable way to get to $44k from a $29k loan @ 3%.
So you rolled in $8k in negative equity....plus taxes, license, registration, extended warranty, etc. Then the insurance is GAP insurance to cover the lender in a loss since you put yourself so far upside down when you bought it. Honestly, I'm shocked any bank would give a 3% loan on that. You must have been really desperate to get out of your previous vehicle that you decided to buy a high mileage Explorer. I'm sure that dealer is hoping you'll be back as I'm sure they likely made well over $5k profit on it.
Hate to ask but why did you trade in a 1 year old Malibu. That's a big hole to dig out of, I would just pay it off when you can and only pay cash for cars in the future. Sorry to sound like a grumpy old dad here but that purchase was a colossal mistake.
I would have never allowed this to happen on my watch. She made this decision when she was on her own.
Hoping She learned from this event.
Currently I would like to A) Have her keep the vehicle and continue paying on it. or B) Sell it private party to thwart depreciation(currently valued at an optimistic KBB of $20,435) and buy a humble vehicle while she saves cash to buy a nice 4-5 y/o car outright the Slovic way.
If you can sell it and get out from under it I would do that and spend no more than around 5K on a reliable Accord or Camry. Buy what you can pay cash for on any depreciating asset. Sounds like you already know that.
I'm worried that even if she sells it for full price(20k) she will still be upside down on it as she still owes (31k).
Yet, I still believe its worth it for her to sell it and drive a car worth 5k which gets better gas mileage and has cheap maintenance. At least for a year. She will then accumulate enough money to buy a very nice car outright. at that point is she keeps up her payments she will still owe 4k on the loan and possibly less because she can use the saved money from paying a more humble car towards the balance of the loan.
After she gets her Nice vehicle for cash she can sell the humble vehicle and with it pay off the remainder of the loan.
What do you think?
Last edited by mercedesbenzs55; Dec 31, 2015 at 04:21 PM.
Reason: I see mike hasn't placed his roll of coins on this one yet.
depends on a few factors, if she needs a nice car for work, how much does she drive, lots of variables. May be better to just keep it and drive it into the ground, that is the only way you will get any value out of it at this point.
There's no reason to add to this by another purchase. It would seem best to liquidate the extended warranty and just use and maintain the Explorer for a while, unless the car is totaled by an unfortunate incident, in which case the Gap insurance would cover the loss and negative equity.
This way you could put away some savings. There is no need to go into debt like this for either car. A friend of mine leased a last gen Honda Pilot EX--L for $289 with an all in cost of about $349 with tax and fees ( basically all end to end costs divided by the number of months in the lease) The buyout is $22k. This sort of thing seems like a more secure path even though there are some double tax implications.
@ Superpop - She drives 6 miles to work, mostly highway. She works at a hospital so no need to be flashy.
@MrRat - What do you mean when you say liquidate?
I'm with MrRat. Keep driving the truck. Stop paying for the service contract and save $191/month or $2292/year. If she's driving 6 miles to work a day, probably a lease makes more sense if she wants a nicer vehicle in the future.
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