I found this interesting/disturbing... figured i'd post it here in case anyone was wondering what your rights are as a car buyer... BORROWER BEWARE: Why Georgia can be a bad place to buy a car Ann Hardie, Carrie Teegardin, Alan Judd – AJC Staff Sunday, October 23, 2005 You live in a state where . . . • You have no recourse if the used car you bought falls apart just after you drive it off the dealer's lot. • Legislation to protect you when buying a car has been scuttled by lawmakers' self-interests. After Rickie and Ronda Coleman purchased a Pontiac Grand Prix from a car dealer who turned out to be a crook, they discovered why Georgia is among the worst places in the country to buy a car. Not only did the Eastman couple have to give their car back, they got stuck paying the note on a vehicle they no longer owned. Then legislation to protect used car buyers from the Colemans' fate got snarled in industry opposition and a lawmaker's self-interest. Rep. Alan Powell, himself a used car dealer, exerted his influence last year to gut the bill, which he says would have cost him money and put some mom-and-pop dealers out of business. "I am a businessman," said Powell (D-Hartwell), "and if you ain't figured it out, Georgia is very much a pro-business state." The lawmaker's strong industry tilt --- as well as his efforts on behalf of his own business --- is commonplace at the General Assembly. And it helps explain why Georgia consumers like the Colemans have little recourse when a car deal goes sour. As part of an ongoing examination of state consumer laws and lending practices, The Atlanta Journal-Constitution found that almost every state does more than Georgia to protect car buyers. • Georgia law, for instance, does next to nothing to look after a consumer who buys a used car only to have it break down on the way home from the dealership --- even if a salesman told the consumer the car runs like a dream. In Mississippi, dealers must provide at least a basic warranty on used cars less than 6 years old and with fewer than 75,000 miles. • Georgia does not regulate "spot delivery," a common sales practice in which a consumer takes possession of a car after the deal has been negotiated, but before the financing has been approved. Once the transaction is final, consumers can find themselves facing higher payments or other less favorable terms than they thought they were getting. Louisiana is among the states that require dealers to refund deposits and return trade-ins should the financing fall through. A 2003 bill with similar requirements died in the Georgia Senate at the hands of a powerful car dealers' lobby. • Georgia was among the last states in the nation to cover new cars with a lemon law --- and still has no such legislation for used cars, even though about three-quarters of the vehicles sold in Georgia are secondhand. In Massachusetts, lawmakers passed a lemon law for used cars years ago, requiring dealers to pay for repairs for up to 90 days on automobiles with fewer than 125,000 miles. • Georgia requires used car dealers to post a surety bond of $20,000 --- hardly enough to compensate even one or two consumers should a dealer go belly up or fail to legally transfer ownership of cars, as happened with Rickie Coleman's dealer in Eastman. The bill that Powell opposed in 2004 would have boosted the bond to $50,000, the amount that North Carolina, among other states, requires. The added protection for consumers would have cost most dealers only two or three hundred extra dollars every two years --- about double what most pay now. In Georgia, decades of legislative decisions have left consumers mismatched against some automobile dealers, the newspaper's examination found. And in a one-two punch that has further handicapped consumers, Georgia courts essentially have given dealers a license to deceive. To a degree unmatched by virtually any other state, Georgia courts repeatedly have put the onus on consumers to be savvy --- not on dealers to be honest. The courts' interpretation of the state's chief consumer protection statute is so unusual that the National Consumer Law Center, a Boston-based advocacy group, has dubbed it "the Georgia Exception." Even the two state agencies charged with protecting car buyers --- the Governor's Office of Consumer Affairs and Georgia's used car board --- rarely provide relief to people taken by a car dealer. In fact, the agencies often seem sympathetic to the dealers they regulate. This climate can be treacherous for Georgians who buy cars, 1.8 million last year alone. Middle- and low-income consumers, most of whom finance their automobiles, are especially vulnerable. They are people like Rickie Coleman of Eastman, who pursued avenue after avenue looking for help after being swindled by a childhood friend who owned a used car dealership. Those avenues all resulted in dead ends. "Basically, I lost $14,900 and I ain't got nothing to show for it," said Coleman, a 38-year-old paramedic. "I was thinking there was something out there to protect the consumer. Come to find out, there wasn't." 'It kept messing up' On a recent swing through Atlanta, Alan Powell jokes that his wife can't tolerate his presence at their Hart County farm more than two days running. As his cell phone blares with calls from constituents and as lawmakers drop by his legislative office to talk shop, you get the sense that it is the 53-year-old Powell who relishes the on-the-go life of a Georgia legislator. The folksy eighth-term Democrat --- who chats openly about everything from his battle with weight to his addiction to cigarettes --- describes himself as a fiscal conservative with a heart. "I've actually read the [U.S.] Constitution," said Powell, who chaired his County Commission before his 1990 election to the Legislature. "Good God, I've been in politics half my life." Powell's political life can take center stage, he said, because his businesses in Hartwell, the county seat of 4,200 residents on Lake Hartwell, largely run themselves. Powell's Grocery on North Forest Avenue is a gray stucco convenience store that sells gas, beer, snacks and lottery tickets. He also owns some rental property, he said. Then there's his used car business, which Powell said he got into around 1993 after a retired sheriff's deputy in town approached him about opening a lot on a piece of Powell's property. In the early years, Powell said, he was more involved in the business, traveling to auto auctions and car sales. But he never managed the day-to-day. "My sitting in an office and waiting for someone to buy a car, that ain't my bag," he said. Powell called the business a difficult one. "You can lose your butt in the used car business, trust me," he said. As for his company --- Highway 77 Auto Sales --- Powell said he "never made any money to speak of. I think it was more fun than anything." (continued...)
GA Auto Purchasing Laws pt 02 The sign has been painted over at the dealership, which now has a new owner. Even though his used car license remains active, Powell said he shut down the business about a year ago after his most recent partner became ill. He hasn't decided whether to open another dealership. Several of Powell's former customers described Highway 77 Auto Sales as a friendly, easygoing business --- one willing to tolerate a late payment every now and then. As with any dealership, they said, you had to check out the vehicles to avoid getting stuck with a lemon. Briana Baker didn't --- and says she got stuck. The single mother said she financed a Mazda 626 in 2002 after hitting a deer and totaling her car. Now 21, Baker said she had bought a vehicle from Highway 77 before and had a good experience. This time, however, the transmission went out 10 days after she drove the car off the lot, she said. Like most used car buyers in Georgia, Baker bought the car "as is," so there was no warranty. The dealership did fix it, but only after tacking the cost of the repair onto her loan, said Baker, who does not remember exactly what she paid for the car. "It kept messing up," she said. "Finally, it blowed up." Baker defaulted on her loan. In early 2004, Powell's dealership sued to force her to pay the $3,573 remaining on her loan, according to records at the Hart County Courthouse. So for eight months, the hospital where Baker worked an $8-an-hour job as a nursing assistant docked her check to pay off the loan, the records show. Baker's experience represents the downside of "as is" sales. The working poor, in particular, can find themselves stuck with no transportation but still having to pay a car note --- even if their vehicle breaks down days, or even a few miles, after being driven off the lot. Powell said he does not know Baker or about her situation. As a general rule, he said, consumers have to make a decision: Do they want more protections, such as required warranties, or do they want cheaper cars? "If they expect someone to warranty a car, they are going to have to pay more for that car," he said. "The consumer ultimately has to make that decision. You can't do all things for all people. A consumer has got to do their due diligence at some point." Large print, small print In Georgia, consumers have to do their due diligence at every point. Compared with other states, Georgia does virtually nothing to protect consumers from getting taken on a car deal. "Georgia's a good place to buy a car --- if you're a car dealer," said Tim Ryles, who became the first head of the Governor's Office of Consumer Affairs in 1975 and left that post in early 1982. Most Southeastern states do little to protect car buyers. Aside from Georgia, the states that offer the fewest consumer protections in the region include Alabama and South Carolina. But even within the Southeast, Georgia often stands out for leaving car buyers at risk. The Legislature has made it difficult for the average Georgian to challenge a car dealer in court. Georgia is among a handful of states banning class action lawsuits for deceptive practices by car dealers and other merchants. As a result, many lawyers aren't willing to take an individual's case because there is not enough money in it. In 1990, Georgia lawmakers passed the Motor Vehicle Warranty Rights Act, commonly called the lemon law, to look out for consumers who purchase defective vehicles. The legislators were among the last in the country to enact such legislation --- and even then they passed a law that applies only to new cars. "We didn't even think about a used car lemon law," said Joyce Kinnard, an Atlanta consumer advocate who pushed for the measure. "It was hard enough to get a new car lemon law." In recent years, consumers and their advocates have been no match for the automobile industry, which has succeeded in killing several measures designed to boost protections for consumers. In 2004, Rep. Rob Teilhet (D-Smyrna) introduced a bill to address one of the most prevalent complaints among consumers: used cars sold as is. In Georgia, that means if you drive a defective car off the dealer's lot, you almost always get stuck with it. About half of the states require dealers to provide a basic warranty or offer minimal assurances about a car's operation and safety, usually based on an inspection. Not Georgia. With Teilhet's bill, only cars older than 6 years and with more than 75,000 miles could be sold as is. "If you buy a car that is not super old or does not have a lot of miles on it, it is reasonable to assume that the car will operate," Teilhet said. "In Georgia, by putting the words 'as is,' they can sell you a car that doesn't run, a truck to haul things that doesn't haul." As a practical matter, Teilhet said, the bill had little chance of passing because of the strength of the car lobby. His proposal did not even get a hearing. The lobby representing new car dealers historically has been among the strongest at the state Capitol. As an indication of the industry's strength, two new car dealers sit on the powerful Board of Regents, which oversees Georgia's public colleges and universities. The trade association representing independent used car dealers has not been as influential. But it has benefited from its relationship with new car dealers, many of whom also sell used cars. The car lobby was effective in stopping Rep. Mary Margaret Oliver (D-Decatur) in her efforts in 2003 and 2004 to rein in abuses in spot delivery. That's the practice in which a dealer negotiates a deal with a consumer, then delivers a car "on the spot," with details, such as a bank's final approval of the financing terms, to be worked out later. Dealers refer to the practice as "puppy dogging" because customers who take cars home typically fall in love with them, flaws and all. The Governor's Office of Consumer Affairs has seen a spike in the number of complaints from less-enamored customers who thought their deals were final, only to have received calls days, even weeks, later from dealers demanding more money through higher down payments or interest rates. Among those filing a complaint were Ida and Wilson Lawrence of Union City. In April 2002, the Lawrences bought a 1999 Buick Century from Bill Heard Chevrolet for $11,990. When they drove the car home, they thought they had an 11 percent loan with monthly payments of $279. Their sales contract and other papers they signed, however, said the deal wasn't done until a lender approved it. And about a week and a half later, the dealership told the Lawrences their loan hadn't gone through. A substitute deal was offered: 17.99 percent interest, which increased the monthly payment to $300. Executives with Bill Heard Chevrolet say they shopped the original deal to seven lenders before finding one who would approve the loan. They say their company, the largest car dealer based in Georgia, offers spot delivery as a convenience to customers. (continued...)
GA Auto Purchasing Laws pt 03 "We're never going to please everybody," said Bill Heard Jr., chief executive of Columbus-based Bill Heard Enterprises. "But the majority of the customers like spot delivery. . . . That's the way things are in America. You kind of have to structure yourself with what the majority wants." The Lawrences reluctantly accepted the less favorable deal, which included $1,500 more in finance charges than they had expected. "I felt like we were forced to take it," Ida Lawrence said. "We had the insurance. We had the new car already." The consumer agency declined to investigate. "I took my lumps after that," Lawrence said. "I realized there was nothing I could do." Some states have attacked the practice of spot delivery with new laws and enforcement actions. Oliver's bill would have voided sales not completed within a 30-day period and prohibited a dealer from selling a customer's trade-in until the deal was finalized. The measure passed the House, but died in the Senate. The new car lobby argued that current law was sufficient to punish dishonest dealers. Oliver has reintroduced the measure for lawmakers to consider when they convene in January. Three decades ago, in an unusual period of pro-consumer action, the General Assembly attempted to give Georgians an advantage against unscrupulous merchants. In 1975, lawmakers passed the state's landmark consumer protection statute, the Fair Business Practices Act. Like similar laws in other states, the act threatens dishonest car dealers and other businesses with fines and the prospect of lawsuits. However, the Georgia courts repeatedly have interpreted the law in ways that have hurt consumers --- and that differ sharply from rulings in other states on similar consumer protection statutes. In a 1980 ruling, the Georgia Court of Appeals said a misrepresentation by a merchant does not entitle a consumer to recover damages "if he had an equal and ample opportunity to ascertain the truth but failed to exercise proper diligence to do so." Or as lawyers in the attorney general's office put it, only somewhat in jest, "The large print giveth, the fine print taketh away." "It rewards cunning and guile, as opposed to honesty, in consumer transactions," Ryles said of the courts' interpretation of the statute. "It's roughly the equivalent of taking something that's supposed to be a nice birthday cake and turning it into cow dung." Victims of fraud In April 2000, Ronda Coleman spotted a white Grand Prix at Gatlin's Used Cars. The 1998 model, with 21,850 miles, felt sporty and came with a sunroof, a requirement of hers. The heated seats were not --- especially in Eastman, which doesn't get too many bone-chilling days. But Ronda liked the idea of having them, her husband said. "I went to see Glenn and he gave me a good deal," recalled Rickie Coleman, a tall, soft-spoken man, seated in his front porch rocker on a warm September evening. "Of course, it turned out not to be such a good deal." Like Coleman, Glenn Gatlin, 39, was raised in Eastman, a town of 5,400 about an hour southeast of Macon. He had taken over the used car business after the death of his father, Ben. The dealership had sold cars on Oak Street as long as anyone could remember. In fact, 20 years ago, Rickie Coleman, then 18, bought his first vehicle, a '78 Pontiac Firebird, from the daddy. "What Ben said, you could bank on," Coleman said. To come up with the $14,900 for the Grand Prix, the Colemans --- she's a nurse and he's a paramedic with Dodge County Hospital --- emptied their savings account of its $4,000. They traded in Ronda's 12-year-old vehicle, but still had to borrow $6,900 from the Bank of Eastman. The Colemans had made a couple of car payments when they received a call from an officer with an Atlanta bank, Rickie Coleman said. The officer told them that Gatlin had failed to pay off the original owner's note, which came to $17,000. They could pay the outstanding note --- money the Colemans did not have --- or the bank would have to come and get the car, the bank officer said. Rickie Coleman couldn't believe that Glenn Gatlin would stiff anyone, especially him. "Oh man, I was floored because this guy had been a friend of mine ever since I was a little boy," Coleman said. In the first half of 2000, it turned out, Gatlin had found himself in over his head. He was so strapped for cash that he was selling cars for less than what was owed on the vehicles, as he did with the Colemans. He was buying cars from auto auctions with checks that bounced, then selling automobiles without titles to customers. He was failing to pay off the notes on customers' trade-ins as promised, then selling those cars to other customers with the loans still in effect. And he was shuffling many high-end vehicles trying to stay afloat. "These were not fishing cars --- they were not pieces of junk," said Timothy Vaughn, the Oconee Judicial Circuit district attorney, who prosecuted Gatlin. By the time his actions came to light around Memorial Day 2000, Gatlin had cheated more than 70 individuals and businesses of an estimated $300,000 to $500,000. "It was me being proud and greedy and trying to be a big-time car dealer," Gatlin said in a recent interview. "I feel really bad. These people, I love them. You just have to face it, you can't run from your mistakes." In 2002, Gatlin pleaded guilty to 106 felony counts and was sentenced to 10 years in prison and 20 years on probation. He was paroled in April. Gatlin, who now works for a lawn mower factory in a nearby town making $7.27 an hour, also was ordered to pay restitution, the details of which are still being worked out. "Absent him hitting the lottery, it is unlikely he will be able to repay his victims," Vaughn said. The Atlanta bank got a court order to force the Colemans to turn over Ronda's car with the sunroof and the heated seats. Meanwhile, the Bank of Eastman demanded its money. If the Colemans didn't pay, their loan would be in default, their credit wrecked. "It seemed like my hands was tied," said Rickie Coleman, who had to buy another car to replace the Grand Prix. "We finally did get out from under it. It hurt us financially, big time." Like the Colemans, many of Gatlin's victims ended up on the hook for loans on cars that they had to return to banks and other creditors. Some ended up with two or three loans. Some filed for bankruptcy. "It put everybody in a bad situation," said John Jessup, president of the Bank of Eastman. The bank required that its loans be repaid, saying that the contracts were not contingent on consumers receiving legal title to the cars. Gatlin's victims didn't even bother to try to get their money by going against the surety bond that all used car dealers in Georgia are required to have. The bond is like an insurance policy that each dealer purchases from a private company. Consumers who lose money when dealers are unscrupulous or go bust can seek restitution from the bonding company. But Georgia requires dealers to have a bond that offers only $20,000 in coverage. That's not per victim --- it's for the total business. In many instances, the requirement, on the books since 1988, would cover only one bad car deal --- nothing close to the dozens in the Gatlin case. "The $20,000 total bond is just a joke in my opinion, with the price of cars and the number of cars that these dealers sell," said Vaughn, the district attorney. After the Eastman fiasco and similar, though smaller, events around the state, members of the used car board decided something had to be done. The state entity that regulates used car dealers decided to push for legislation to boost the bond from $20,000 to $50,000. The higher bond would not have covered all of the Eastman victims, but it was a small step in the right direction, members said. And it wouldn't have cost most dealers that much. Jeff Wilkinson is a Milledgeville dealer who serves on the board. A $20,000 bond runs him $125 every two years, he said. The $50,000 bond would probably have added about $250 to the bill. "I'm on the used car board and I see the problems," Wilkinson said. "Yes, it was going to cost me more. But it was something that needed to be done." If dealers couldn't afford the higher bond, some board members said, then maybe they shouldn't be in business in the first place. "I don't think adding another $200 to $300 is prohibitive," said Diana Waldrop, the board chairwoman. 'Wanted to cushion it' Rep. Alan Powell lists his favorite time at the General Assembly as the years he spent on the old House Industry Committee, which weighed in on legislation affecting everything from public utilities to economic development. The committee was dissolved three years ago. "I just love business and commerce," Powell said. "I love the fact that by being logical, we don't overburden the right of people to do business. We don't go so far as to take away the consumer's right to think for themselves." It is just that kind of thinking that has made Powell a favorite among industries seeking a sympathetic ear at the Capitol. Of the $132,000 in campaign funds that Powell had on hand as of June 30, the vast majority came from corporations and political action committees, almost all from outside his northeast Georgia district. Many of his most recent donors paid to play in the lawmaker's annual golf tournament.
GA Auto Purchasing Laws pt 04 In 2004, lobbyists representing a wide range of industries, from car dealers to bankers to health care providers, spent $8,200 on Powell, according to reports filed with the State Ethics Commission. Last year, the lobbyists bought Powell, among other things, 66 meals, a dozen days on the links and a trip to the Kentucky Derby valued at $3,250, the reports show. Powell has since disputed the Derby expenditure, saying he sat with a lobbyist but paid his own way. Lobbyists involved back Powell's account but have not amended the report. Although Powell is unapologetic about his ties to industries, he insists that business does not get a free pass. He points to his efforts to create a state board to license general contractors and home builders, which was established in July. "I think that every profession should be regulated in terms of oversight," Powell said. Although the Industry Committee may have been Powell's first love, it is his seat on the Motor Vehicles Committee --- on which he has served his entire time in the Legislature --- that has given him considerable influence. Rep. Bobby Parham (D-Milledgeville), who chaired the committee 14 years, thought so highly of Powell's opinion, in fact, that he was willing to alter his own legislation. After speaking to members of the used car board, Parham had agreed to sponsor the legislation upping the bond requirement for used car dealers from $20,000 to $50,000. Parham initially thought the higher bond sounded like a good idea, given how many Georgians buy used cars. But colleague Powell viewed the measure as bad for his industry. The used car lobby opposed it, Powell said in an interview, saying the additional cost would prompt some dealers to go out of business, or worse still, operate without a license. Even though the higher bond would have cost most dealers an additional few hundred dollars every other year, it would be higher for those with blemished credit. Some dealers with financial problems might not have qualified for the higher bond at all. "You've got a lot of good used car dealers in the state," Powell said. "You can't have car dealers that just go out of business." The used car board wanted the higher bond to cover more consumers. But it also wanted to weed out dealers with bad credit who are prone to going out of business, leaving consumers in the lurch should problems arise. "We made this decision knowing full well that it was going to be difficult for some people to get a license," said Waldrop, the board chairwoman. "We believe if we can get people with better credit, they will run better operations." That rationale angered Powell. "What business is it of any licensing board of anybody's credit?" he said. "Anybody in business can have a downturn. Some of the best people I know have been broke once or twice." After Parham's bill to increase the bond to $50,000 came up for discussion in the Motor Vehicles Committee, Powell recommended upping it to $30,000 instead. The committee went along, as did members of the used car board. But when the bill came before the full House, Parham offered yet another version, which introduced a complicated scheme in which the amount of the bond depended on how many cars a dealer sold each month. Parham said the change came from Powell. "Alan was worried about some people in his area," Parham said. "And he is in the business, the truth be known. He wanted to cushion it." Powell said he didn't recall whether he proposed the change, but that it sounded to him "like a pretty good idea." But the measure would have been unenforceable because the used car board does not have the resources to track dealers' monthly sales. No other state agency collects that kind of information, either. The board no longer pushed for the measure and it died in the Senate. Georgia consumers were right back where they started. "I felt they handed us a carrot," the used car board's Waldrop said of the General Assembly. "Then they ate it." (finish, all content is taken from the AJC article)
yeah i know it's a lot to read and that really is the short version... but it's always interesting to read the context of who's involved with decisions (and who's in who's pocket)
yeah my favorite part is that he was a used car salesman before he became a govt official... fucking classic.
yea Ga sucks at all thats stuff...just in the end be really careful who you purchase a car from and i usually see if i can have a mechanic take a look at the car first.
i would just prefer to buy my car from somone i know and can easily get the history on or buy one brand new..