California is once again at the forefront of consumer protection with a proposed bill aimed at safeguarding used car buyers. This initiative, if passed, will address deceptive lending practices, sales of lemon-law buyback vehicles, and vehicles with frame damage. Buyers would also have a three-day window to cancel their purchase. This article delves into the history, current state, and potential future of lemon laws for used cars, highlighting the need for comprehensive consumer protection.
In 1982, California pioneered the first automobile "lemon law," providing owners of defective new cars the right to seek a replacement or refund if the defect couldn't be repaired within a reasonable timeframe. This legislation quickly gained popularity, prompting other states to adopt similar laws. By 2007, all fifty states had enacted some form of lemon law to protect new car buyers (source).
While lemon laws for new cars are well-established, protections for used car buyers remain sparse. Deceptive practices such as odometer rollback, selling previously bought-back lemons, and undisclosed accident histories are rampant in the used car market. Additionally, deceptive financing terms can add significant hidden costs to the purchase.
The California Assembly recently passed a "bill of rights" aimed at protecting used car buyers. Although not yet signed into law, this bill addresses several critical issues:
If enacted, this bill could set a precedent for other states to follow, much like the original lemon law did in the 1980s. Consumer protection laws for used cars could become a nationwide standard, benefiting millions of buyers.
California's proposed bill represents a significant step towards comprehensive consumer protection in the used car market. If successful, it could inspire similar legislation across the United States, ensuring that used car buyers are safeguarded against deceptive practices. As consumer protection laws evolve, the future looks promising for used car buyers.
For more information on lemon laws and consumer protection, visit the Federal Trade Commission and the National Highway Traffic Safety Administration.
Home Loans – Identity Theft Protection Could Hurt Home Sales
Identity theft has been a hot topic in the news during the last few years. Just a month or so ago, forty million credit card numbers were compromised due to a computer attack on a credit card processor. Consumers are rightly concerned, as it can take years to unravel the problems created when someone’s identity is stolen. New legislation in Texas and California, also proposed elsewhere, is designed to protect consumers by letting them put a “freeze” on their credit reports. Those in the real estate industry are worried, however, that doing so may make it difficult for some people to buy homes.
Debt Consolidation – How to Protect Your Credit Accounts from Theft
Last week, a security exploit at CardSystems Solutions, Inc, a credit card processor, may have allowed thieves to obtain as many as 40 million credit card numbers from unsuspecting victims. The theft was brought about though a virus introduced into the CardSystems that allowed external hackers to obtain access to the account information. Adding to the problem was the fact that CardSystems wasn’t supposed to have the account information at all. It appears that CardSystems “inappropriately” held onto the information after clearing the credit card transactions. At that point, the account information should have been deleted. CardSystems held onto the account information for supposed “research purposes.” Fortunately for those involved, the compromised information only included account numbers and not Social Security numbers, which would have assisted the thieves in identity theft scams. This latest security breach at a credit card processor outlines how anyone can be vulnerable to account or even identity theft. Is there anything that can be done about it?
New Bankruptcy Law – Targeting the Wrong People?
Last April, President Bush enthusiastically signed into law the oddly-named Bankruptcy Abuse and Consumer Protection Act. This bill, representing the biggest overhaul of bankruptcy law in twenty-five years, was written in order to discourage “bankruptcy of convenience.” Proponents of the bill, which included the credit card industry, say that the bill is necessary in order to stop an avalanche of bankruptcy filings by drug users and compulsive shoppers and gamblers. The law makes it harder to have debts wiped away, requires credit counseling for those considering bankruptcy, and holds attorneys responsible for paperwork errors by their clients in bankruptcy cases. The net result will probably be chaos, as fewer attorneys will handle bankruptcy cases, credit counselors will raise their fees, and more consumers with problem debt will be clueless as to what they should do next. Adding to the confusion are some new statistics that suggest that a large number of bankruptcies that are thought to be personal are actually business bankruptcies. As a result, the new law may be unfairly targeting consumers for punishment when they are not actually the biggest part of the problem. Worse, it could be harming small businesses.
