Three car dealerships in New York have agreed to return more than $100,000 to customers who unknowingly bought cars previously used as rentals or failed to get their deposits back after their auto financing applications had been denied.
In the first case, the settlement with Attorney General Andrew Cuomo's office calls for two dealerships in New Rochelle and Lynbrook to refund 10% of the purchase price to 75 consumers who bought cars they didn't know were used as rental vehicles. The refunds by J.M.Hyundai and Legacy Infiniti total $90,246 and $19,254, respectively, and are in the range of $840 to $4,000 apiece.
"The car was used -- I knew that, but thought it was used by an individual. Owners usually take good care of their cars," said Robert Remling of Mahopac, N.Y., who paid J.M. Hyundai more than $16,000 for a Toyota. "If I knew it had been a rental, I wouldn't have bought it."
Another customer of the same dealership, Edward Barra, told Consumer Ally he was assured by an employee that the Hyundai Sonata he was considering had not been a rental, despite its 27,000 miles. Barra bought it for $13,000.
The attorney general's complaint also accuses Middle Country Motors, a now-defunct Centereach, N.Y. dealership, of requiring cash deposits from consumers who sought financing before they knew the precise terms of the financing agreement. In violation of New York State property law, the car seller worded those contracts in a way that suggested the deposits were not refundable in order to discourage consumers whose financing applications were rejected from seeking refunds.
The company is to refund all consumer deposits and pay $12,000 in penalties and costs to the state.
"Buying a car is a major purchase and consumers should expect honesty and integrity, not fraud and deception, from these dealerships," Cuomo said in a statement.
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