HRC targets predatory car sales
By Noel Lyn Smith
WINDOW ROCK, November 29, 2012
P redatory car salesmen are the next target of the Navajo Nation Human Rights Commission.
A meeting on the subject is set for 10 a.m. Friday, Dec. 7, at the Dilkon Chapter House. Consumers who believe they have been duped by vehicle salespeople are urged to attend.
The commission is focusing on this issue based on comments it has received about such business tactics, said Leonard Gorman, HRC executive director.
Questionable tactics are allegedly being practiced by both used and new automotive dealerships in border towns surrounding the Navajo Nation, and there is concern that such practices could result in a number of Navajos being deceived into signing unfair purchase contracts, Gorman said.
Gorman said there is a variety of methods dealerships may use but one specific tactic is the "yo-yo effect."
The "yo-yo effect" is where dealers let buyers drive a new vehicle home in hopes of locking them into a deal and later tell them the financing fell through. This tactic can lure buyers to accepting a higher interest rate, according to the Center for Public Integrity.
Along with testimony, individuals are asked to bring their sales contracts and other related documents to the meeting. Human rights commission staff will be available to make copies of the documents.
The testimonies and information collected from the meeting will be used to determine the level of the problem and which areas are experiencing the most activity, Gorman said.
The HRC is also working with the national group Human Rights Watch to complete a study on places in the United States that have a high number of predatory lending activity along with other unethical types of arrangements, he said.
In recent years the focus on predatory lenders, ranging from mortgage companies to automotive dealers, has increased. A 2008 Gallup poll for the Better Business Bureau showed that only 13 percent of Americans trust car dealers.
According to a publication from the Arizona Attorney General's Office, here are some red flags consumers should watch for:
- A salesperson rushes the consumer to sign paperwork without providing a chance to review the contract terms.
- Advertised minimum trade-in amounts and free gifts. Dealers may raise the price of the car to offset a low value trade-in or the cost of the gift.
- A contract that has terms substantially different than what was advertised or what the salesperson promised.
- A salesperson suggests writing false information on the finance application, such as inflating the consumer's income. Providing false information to obtain financing is a crime and could result in an unaffordable contract.
- A salesperson suggests taking the car home before financing is approved. This practice is designed to "lock you in" to a purchase.
The tribe's Human Rights Commission advocates for the recognition of Navajo human rights and addresses discriminatory actions against the citizens of the Navajo Nation.
In September, the Navajo Nation Council's Naa'bik'iyati' Committee approved Frank Bradley III, Steve Darden, Jennifer Denetdale, Valerie Kelly and Justin F. Tsosie to serve on the commission.
Information: Navajo Nation Human Rights Commission, 928-871-7436.