Wednesday, September 6, 2017

Houston Tropical Storm Harvey Will Drown Market With Deceptive Flood Cars

As waters rise following Tropical Storm Harvey, the used car market will soon be swamped by flood cars with washed titles. Find out why these cheap cars aren’t worth the money.

Paging through the Internet, you could get a salvage 2013 Jaguar for $10,950 or a 2015 Toyota RAV 4 for just $7,950. You might be able to fix it, resell it and make a bundle - or sell to an unsuspecting buyer.

"Submerge your dreams," says Dani Liblang, founder of The Liblang Law Firm.P.C. in Birmingham. “The thought of a late model, low priced car is enticing, but even the muffler or leather seats from a car submerged in the hurricane waters flooding Houston, Texas, and Louisiana, could be damaged beyond repair.” 

Tropical Storm Harvey Causes Widespread Flooding

Southern Texas has been hammered by six days of rain from Hurricane Harvey. Parts of the Houston area had more rainfall from a single storm than anywhere in the continental United States. By Tuesday, August 29, the area had seen over 50 inches of rain. All together, 25 to 30% of Harris County was underwater. 

Flood Waters Lead to Washed Titles

After a flood like this, the unscrupulous seek to acquire cars. Huffington Post estimates over a million fraudulent used cars are on the market today with "washed" titles. Individuals or car lot owners intentionally hide flood cars’ histories by leaving information off the table or deliberately erasing important details.

“Re-badging” or “title washing” is a federal crime, according to the Department of Justice and should be reported immediately. The Federal Trade Commission’s Used Car Rule requires dealers who sell six or more vehicles to post a Buyer's Guide form in every used car on the lot. This poster would list all the possible defects that could occur on this vehicle.

The Uniform Commercial Code states that a used vehicle automatically includes an implied warranty of merchantability. To be “merchantable,” the vehicle must be fit for its intended purposes – that is, safe to operate on the road. Many used car dealers try to avoid responsibility by selling vehicles “as is.” However, an “as is” clause does not protect a dealer who fails to disclose that a vehicle was previously flood damaged. Also, if the vehicle is sold with a warranty or service contract, the federal Magnuson-Moss Warranty Act prohibits “as is” disclaimers.

If one of these laws are violated the customer could have a case against the dealer or owner who sold the flood-damaged vehicle. The more you know about car purchases and legal aspects the better the chance of a good experience.

What to Look For To Avoid Flood Cars

 When a car sits in water it slowly corrodes the engine and electrical components. Flood waters leave mold and mildew in the insulation between interior and exterior car body that could circulate every time you put on the heater or air conditioner. The door jambs could malfunction and the instrument panel could fail its commands. 

A thorough inspection is essential before purchasing a used vehicle. The Federal Trade Commission suggests inspecting for musty odor. Don’t be fooled by strong air freshener. Check the carpet to see if it’s new, stained, damp or mismatched. You might find mud or silt in the glove compartment and brittle wires that break when touched.  Be sure to turn on the ignition to check the instrument panel lights are working and the commands are followed. Check all the systems twice to make sure it works.

Ask a trusted mechanic to look over the vehicle. Flood cars can sometimes be spotted through rusting wheels or damage to the undercarriage. You can use your Vehicle Identification Number to get a free CARFAX flood damage check. The Department of Justice also helps consumers identify cars in floods or severe accidents. Check

Deceptively selling flood cars is illegal, but that doesn’t stop many used car dealers. Cars damaged by Tropical Storm Harvey will be showing up on the lots soon. Be prepared to make sure you don’t drown in a deal that’s too good to be true.

Dani K. Liblang is a lemon law lawyer at The Liblang Law Firm, PC, in Birmingham, Michigan. She defends consumers against car dealers who sell bad cars. If your recent purchase turned out to be a flood car, contact The Liblang Law Firm today for a consultation.

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