Consumer Alert September 14, 2000

Vol. I No. 2 September 14, 2000 CCONSUMERONSUMER AALERTLERT A Publication Of the South Carolina Department of Consumer Affairs Philip S. Porter, Administrator/Consumer Advocate Spot Delivery Could Affect You A Lesson On Spot Delivery Are you in the market for a new or involves verification of various forms of The lesson to be learned is that you used car? In today’s complex and credit information. Often times, it is hard must read everything you sign and in financial world there are many to verify credit information after standard today’s market beware of ‘spot delivery.’ opportunities awaiting you. You can buy business hours. cars after customary business hours and From time to time, consumers are See the checklist below before purchasing a even into the very late evenings at some contacted one or more days after the sale car. places, but is this really for your and asked to return the vehicle. The convenience? consequences of returning the vehicle Car buyers beware! There is a sometimes cause the consumer distress CCONSUMERONSUMER confusing and sometimes frightening and embarrassment as he or she has CHECKLIST concept out there called ‘spot delivery.’ become attached to the vehicle. CHECKLIST Spot Delivery is a term used most In one instance, a South Carolina Buying a car can be a difficult commonly in the auto industry. Spot couple suffered the consequences of spot process. Below please find some Delivery occurs when a dealer allows a delivery without knowing they had agreed questions about credit and loans that consumer to take possession of a vehicle to it. you should ask. Remember that a before completing all aspects of the The couple entered a dealership on a call or a visit to a dealer should help credit verification process. The vehicle Saturday afternoon to purchase a new clarify details about low interest is delivered to the consumer based upon vehicle. The couple and the salesman loans and car credit. a conditional credit approval. reached an agreement on the price. They Questions About Car Credit: Generally, if the buyer and seller sign gave information for credit approval and a 1. Will you be charged a higher price for the a contract it is binding on both. If the contract with credit terms was signed. car to qualify for the low-rate financing? Would the price be lower if you paid cash, or dealership demands the car back just The couple was asked to sign other supplied your own financing from your bank because it did not know how good the paperwork and was told that it regarded or credit union? customer’s credit was, this would be an insurance and warranty. The couple soon, 2. Does the financing require a larger-than- thereafter, left the dealership feeling usual down payment? Perhaps 25 or 30 illegal act. Even so, some dealers sought percent? to avoid this problem by having happy with their new purchase. 3. Are there limits on the length of the customers sign or initial disclaimers To their surprise, three days later they transaction? Are you required to repay the indicating they (consumers) agree to received a call from the dealership asking loan in a condensed period of time, say 24 or 36 months? return the vehicle if the customer does them to return their new car because their not meet the finance’s underwriting. credit was not approved. The couple 4. Is there a significant balloon payment - possibly several thousand dollars-due at the The credit application process returned the car and after asking end of the loan? questions they learned that they had 5. Do you have to buy special or extra actually signed a disclaimer, which they merchandise or services such as rustproofing, CONTENTS an extended warranty, or a service contract were led to believe was insurance and to qualify for low interest? Spot Delivery...... 1 warranty, saying that if they were not 6. Is the financing available for a limited time Consumer Checklist...... 1 approved for credit then they would have only? Some merchants limit special deals to a Consumer Education...... 2 to return the vehicle. few days or require that you take delivery by a certain date. Fast Facts...... 2 They ended up feeling as though they Scams...... 2 had been tricked. 7. Does the low rate apply to all cars in stock or only to certain models?

S.C. Department of Consumer Affairs 3600 Forest Drive, Suite 300/P.O. Box 5757 Columbia, SC 29250 (803)734-4190 or 1-800-922-1594 *All information in this newsletter may be copied and distributed. 2 Consumer Alert September 14, 2000

Consumer report inaccurate or missing labels. Education: Teachers please discuss this Facts for SCAMS concept with your students! ` Consumers: The busy vacation season is Do you know your Closet Cues: Care coming to an end as is a Clearwater, Florida based travel agency. After Consumer rights? Labels and Your Clothes hundreds of Virginia customers were Right to Safety: The right to Your favorite sweater shrank, given the runaround, steered to places expect your health, safety and your new pants puckered and the they didn’t want to go, or told nothing is available for trips and financial well-being will be protected. colors in your new shirt ran. You’re vacations they have been looking Right to Information: The right furious! However, don’t toss the to have access to full and fair forward to, Virginia Attorney clothes out just yet. If you followed General Mark L. Earley decided to information and to be protected the cleaning instructions on the care against false or misleading claims. take action. Along with the FTC, labels, you can return the garments Mark L. Earley has filed a federal Right to Choice: The right to and ask the retailer for an exchange complaint accusing Med Resorts make an informed choice among or a refund. International of travel-related fraud. products and services at fair and Also known as and World competitive prices. Under the Federal Trade Commission’s Care Labeling Rule, Connections Travel, Interval Right to Be Heard: The right to a International, and Destination manufacturers must tag their full and fair hearing and, if possible, a Unlimited, Med Resorts International satisfactory resolution when clothing with at least one safe requires their customers to pay an up dissatisfied. cleaning method. Garments sold front fee to join. This fee includes 15 Right to Consumer Education: without a care label-or with weeks of accommodation at various The right to receive continuing inaccurate cleaning instructions-may locations to be used over the next 40 consumer education that will help violate the Rule. Manufacturers may years. Med Resorts International ensure you have the information you use certain care symbols in place of guarantees accommodations at many need to exercise your other rights as a words on labels, to help consumers resorts located throughout the United consumer. understand the new symbols. States. Many Virginia customers in Right to Service: The right to particular however, found out that convenience, courtesy and Med Resorts International did not responsiveness to needs and problems Fast Facts: uphold to their guarantee. Since and to take the steps necessary to 1991, more than 300 complaints have ensure that goods and services meet been filed in Virginia against Med * Care labels are required by law on the quality and performance levels Resorts International. The Med claimed. all clothing, except: garments made Resorts complaint is part of a primarily of suede or leather; “Operation Travel Unravel.” This To Request Free Educational Materials footwear, gloves, hats or other items program targets fraudulent travel or Arrange for a Speaker Contact: operations such as Med Resorts for the head or hands; and household Sherry King International that are being S.C. Department of Consumer Affairs items, such as linens. investigated by the FTC and state law 3600 Forest Drive, P.O. Box 5757 * If you follow the care label’s enforcement agencies around the Columbia, SC 29250 instructions and the garment is country. Sou 1-800-922-1594 damaged, return it to the store. If the (803)734-4195 rce: store will not resolve the problem, The [email protected] Wa Consumer education should write to the manufacturer. shi * You can help the FTC assure that ngt on start now! care labels are accurate and attached. Ti mes Brandolyn Thomas C. Pinkston...... Deputy Public Contact FTC (6th and Pennsylvania Information & Education Avenue, NW, Washington, D.C. 20580 Sherry Gore King...... Education Coordinator Shana Kinard...... Newsletter Editor or call them at (202) 326-2222) to

S.C. Department of Consumer Affairs 3600 Forest Drive, Suite 300/P.O. Box 5757 Columbia, SC 29250 (803)734-4190 or 1-800-922-1594 *All information in this newsletter may be copied and distributed.