Car Buyer Law Stalled for Lack of Action

Governor failed to appoint directors to oversee program in a timely manner

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    NEWSLETTERS

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    The law creates a program to compensate car buyers when sellers fail to complete trade-in payments as agreed.

    As if car buyers didn't have enough reasons not to sympathize with auto dealers, the State of California has taken more than six months to implement a law intended to rescue car buyers left in the lurch by bankrupt, or corrupt, car sellers.

    The law, which was approved as SB 729 in 2007 and went into effect in July 2008, was designed to ensure that car buyers aren't left holding the bag if the car dealer who purchased their trade-in fails to make all the outstanding loan or lease payments.

    According to the legislation, dealers were supposed to begin paying a one-dollar fee per vehicle, and the state was required to set up a non-profit Consumer Motor Vehicle Recovery Corporation to oversee the operation.

    For car buyers who find themselves surprised by the unfortunate revelation of owing monthly payments on both a new vehicle, and the trade-in that the dealer was supposed to satisfy, the program is intended to provide up to $35,000 in assistance. The money can also be claimed if the dealer fails to pay license or registration fees.

    Trouble is, the state still hadn't appointed a complete board of directors for the CMVRC as of this week, and consumer advocates aren't happy about it.

    Rosemary Shahan, president of Consumers for Auto Reliability and Safety, told the Daily News that, though the majority of the board has now been appointed, it's likely to take several months before those appointees can get the program up and running.

    -- TJ Sullivan