New York City's new rules governing marketing practices by used car dealers went into effect late last month.
According to the New York City Department of Consumer Affairs, the new rules "will help tackle common deceptive and predatory practices employed by used car dealers," such as failing to inform consumers about financing terms, misleading consumers about whether add-on products are required in order to obtain financing, and misrepresenting monthly payment amounts.
The new rules require used car dealers to:
- Provide consumers with, and then have them sign, a Consumer Bill of Rights;
- Post the Consumer Bill of Rights where consumers negotiate or execute sales contracts;
- Provide consumers who finance a used car with a Financing Disclosure Form, which includes the lowest annual percentage rate offered by the company for the type of transaction;
- Provide consumers with a Contract Cancellation Option, which allows consumers to cancel within two weekdays.
In addition, these notices must be in the language in which the contract was negotiated.
Combating predatory practices in the used car industry -- including enforcement actions against car dealers -- continues to be an important priority for the New York City Department of Consumer Affairs.
Buying a used car is a major financial commitment. By requiring used car dealerships to offer additional disclosures, we ensure that hard-working New Yorkers are able to have a fair and transparent deal when purchasing a car. These rules provide added protections for all consumers, especially those who fall victim to predatory practices.