Consumer Protection Brochure
Contract
Issues | Consumer Warranties
| Automobile Issues | Landlord/Tenant
| Credit Issues | Deceptive/Misleading
Ads | Contests/Sweepstakes/Lotteries
| Preventio
Door to Door Sales
Selling door-to-door is a difficult
task for the salesperson. Many people may be contacted before
a single sale is made. Therefore, door-to-door salespeople
have to make a larger commission on each item they sell, in
order to make any profit. Items sold by door-to-door sales
may, therefore, turn out to be more costly than they would
be if purchased elsewhere. Here are some useful tips on how
to deal with door-to-door salespeople:
-
Take your time. Don't buy
on the spot. It's best to do some comparison shopping
first. A reputable salesperson will be willing to come
back after you have done your comparison of prices and
quality.
-
Find out if the salesman
has a solicitor's license. Ask to see the salesperson's
solicitor's license. The license will usually be issued
by the city where you live.
-
Be careful about letting
the salesperson into your home. A person who claims he
or she is a salesperson may really be someone intending
to burglarize your home or commit another crime. Once
in, if the salesperson refuses to leave, threaten to call
the police. If he or she still refuses to leave, place
the call.
-
Make checks payable to the
company. If you are paying by check, make it payable to
the company, not to the salesperson.
The law requires that the door-to-door
salesperson must, at the time he or she first contacts you,
make you aware that the purpose of the contact is to make
a sale. The salesperson must tell you his or her name, the
company name, and describe the kind of goods or services being
sold. He or she must show you identification which contains
the address of the business (B&P §17500.3). The salesperson
will want you to sign a sales contract if you make the purchase.
Here are some helpful tips which you should keep in mind before
signing a sales contract:
-
Don't sign anything until
you know exactly what you are signing and understand it.
-
Get all promises in writing
and keep a copy. We suggest as well that you have the
salesperson sign your written record of these promises
stating, "seller and buyer have on this date agreed
to the provisions as stated above."
-
Look carefully at the contract
to be sure it has no blank spaces or hidden/covered portions.
If it does have blank spaces, cross or line them out so
that the contract cannot be filled in with terms you have
not agreed to after you leave.
-
Make sure your copy of the
contract is the same as the seller's.
Canceling Door to Door Sales Contract
You have the legal right to cancel
your contract until midnight of the third "business"
day (not Sundays or holidays) after the day you sign a door-to-door
sales contract worth $25 or more, including any interest or
service charges. This cancellation must be in writing. This
three-day "cooling off" period gives you the chance
to make some comparisons and to rethink your purchase (Civ.
Code §1689.5). Assuming that there was a written sales agreement,
the contract you have signed is required by law to be dated,
signed by the buyer, and to contain near your signature an
easily read and conspicuous statement notifying you that you
can cancel the contract at any time prior to midnight of the
third business day after you sign the contract. The law requires
at the time you sign your contact, that you be provided with
two copies of a "notice of cancellation" form attached
to the contract, and the address to which the form should
be mailed.
You may cancel the contract without
penalty or obligation, by mailing the "notice of cancellation"
within three business days of signing the contract. If you
cancel, any payment you have made and any negotiable instrument
you have signed must be returned within 10 days of receipt
by the seller of your cancellation notice and before they
pick up their merchandise (Civ. Code §1689.10).
If you cancel and make the goods
available to the seller, but the seller does not pick them
up within 20 days of the date of your notice of cancellation,
you can either keep the goods or get rid of them without any
further obligation. If you don't make the goods available
to the seller, or if you tell the seller you will return the
goods and then fail to do so, you remain liable for performance
of all your obligations under the contract.
You do not have to use the notice
of cancellation form to cancel the sale. A letter or telegram
stating you are cancelling is sufficient to effect a cancellation,
so long as it indicates your intention not to be bound by
the contract. It is wise to send the notice, letter or telegram
of cancellation by certified mail so you will have a receipt
to prove you sent it on time. Your notice will be effective
once it is deposited in the mail.
If you have not been given a
notice of cancellation form, you have even longer to cancel
the contract. Until you are given this form, you can cancel
at any time. Once you are given the form, you have three days
to cancel. It is important to remember that the three-day
cancellation period we have discussed applies to purchases
worth $25 or more (including interest, mailing, and other
charges) in door-to-door sales contracts, or when a company
calls you at home. The goods or services purchased must be
for personal, family, or household use.
Telemarketing
Telemarketers are people who
sell products and services over the telephone. Similar to
door-to-door sales, you should not allow a sales person to
rush you into purchasing a product over the telephone. While
there are many telemarketers who are selling legitimate products,
consumers pay billions of dollars each year to fraudulent
companies.
Before you buy from a telemarketer,
check on the reputation or credentials of the company. To
do this, you can use any number of these methods:
-
Ask the company to mail you
information about themselves;
-
Call the Better Business
Bureau (listed in the white pages);
-
Get the physical address
of the company (Post Office Boxes may mean fraud);
-
Check to see if the company
is listed in the phone book (or ask directory assistance);
-
If you are investing over
the telephone, check with the Securities Exchange Commission
to see if the company is registered. Also, get a prospectus
from the company itself before committing yourself.
-
If donating to a charity
over the telephone, check with the Attorney General's
Registry of Charitable Trusts before you donate, to be
sure of the organization's status.
When and if you decide to buy,
be extremely careful when you give the telemarketer your credit
card or bank account numbers. Unless you are familiar with
the company, it is not a good idea to give them these numbers.
Mail Order
When purchasing something through
mail-order, you should be more careful than if you were to
purchase from a store. As with any purchase, you should avoid
impulse purchases. Give yourself time to do a little comparison
shopping to compare prices, guarantees, return policies and
the like. You should also check the business' reputation by
asking around or by calling the local consumer protection
agency or the Better Business Bureau. Here are some tips to
follow to help you make a better purchase:
-
When comparing mail-order
prices, do not forget to include the applicable shipping
and handling charges;
-
Find out the seller's return
policy (including who pays for return postage);
-
Find out about the guarantee
on the merchandise (including if the item can be repaired
locally and if not, how long it will take to have the
product returned;
-
Find out how long it will
take the business to deliver your order (If no date is
stated, you must wait only 30 days);
-
If you are unfamiliar with
the company you are ordering from, make a small order
to determine how it is handled by the company before you
make a large one;
-
Finally, if you have any
doubts, ask the business for a more detailed description
of the merchandise and/or the guarantee.
To protect yourself, you should
keep a copy of your order form and any letters sent to or
from the company. You should also pay by check, money order,
or credit card rather than cash, to have a record of payment.
Note: Do not give a credit card number to a company unless
you have checked out its reputation. A final method of
protection is to check the merchandise immediately upon arrival.
If the product is not what you ordered, return it with a letter
explaining the problem (be sure to keep a copy of the letter.)
Membership Plans:
A membership plan, like Book
of the Month Club, is a form of mail order buying which provides,
at regular intervals, a product such as candy, compact disks,
tapes or books. For example, each month a book is sent out
to Book of the Month Club members. Members are given advance
notice of the book to be distributed in the next mailing.
The book is then sent out to the member unless, within a reasonable
time, the member returns a form saying not to send the book,
or to send an alternate book for that month. The FTC specifically
defines the rules of operation for these types of membership
mail-order plans, in order to protect the consumer. The FTC
regulations require that all advertising and other promotional
materials for a membership plan must clearly state:
-
The nature of the plan.
-
Exactly how many items a
subscriber has to buy over how long a period of time.
-
How often the company sends
offers.
-
How the subscribing consumer
can inform the company that a selection is not wanted.
-
Whether billing charges include
shipping and handling.
-
That the subscriber has a
right to cancel membership once the membership club contract
has been fulfilled.
Additionally, membership plan
regulations require that subscribers be provided at least
10 days to decide whether they want a selection sent to them
by the club. If the subscribing consumer is not allowed at
least 10 days for this decision, the seller must give full
credit and pay shipping costs for the selection returned (Civ.
Code §1584.6).
Unsolicited Goods:
If you receive something in the
mail that you are certain you did not order, the law allows
you to keep the merchandise without paying for it, unless
the merchandise is related to your participation in a "membership"
plan which is discussed below. This includes any merchandise
selected by the company and offered to the consumer which
will be mailed to him/her for sale or on approval unless he
exercises an option to reject the offer of sale (Cal. Civ.
Code §1584.5) This includes free samples, small articles which
may be included in a charitable solicitation, and every other
kind of un ordered merchandise you may receive through the
mail. You are under no obligation to pay for or return these
goods. You may want to send a letter to the seller of the
un ordered merchandise you have received, stating that you
intend to keep the merchandise as a free gift. Keep a copy
of the letter. This will help you prove later, if necessary,
that you did not order the merchandise and may clear up what
was an honest mistake by the company in shipping you the merchandise.
If you learn from the seller that un ordered merchandise was
indeed sent due to an honest error, write to the seller and
offer to return the merchandise if the seller pays postage
and handling. Give the seller a reasonable time (i.e., 30
days) to pick up the goods or arrange to have them returned
at no expense to you. Let the seller know in writing that,
after a specified time has passed, you reserve the right to
keep the goods or dispose of them as you wish.
The Song-Beverly Consumer
Warranty Act of 1970 (Civ. Code §1790 et seq.) defines
the different kinds of warranties which may accompany new
consumer goods (excluding clothing and consumables) purchased
in California for use primarily for personal, family or household
purposes. The goods must be purchased from a person or company
engaged in the business of manufacturing, distributing or
selling such goods at retail. A warranty is the manufacturer's
or seller's promise to stand behind a product. A warranty
may be written, verbal, or "implied" (that is, created
by law, even though not oral or in writing). If you buy a
new toaster, a written warranty may accompany the purchase.
Sometimes, you will not find a written warranty attached to
the toaster or in its packing box even though you may have
been told by the store clerk that it was "warranted".
Express (Written) Warranties
Written warranties come with
most major purchases of new goods, although they are not legally
required. It is not necessary under the law that the written
warranty use words such as "warrant" or "guarantee,"
but if these words are used, an express warranty is created.
A written statement as to the value of your toaster, or an
opinion that the toaster is a good one, for example, is not
legally a warranty. Likewise, a written statement that it
is the store's general policy that you, the customer, must
be satisfied with the toaster, is not a warranty. The protection
afforded by written warranties vary. Here are a few questions
that you should ask about a warranty before buying the product.
What parts or repair areas
are covered by the warranty?
See what is excluded. (Some major problem areas may
be excluded, thus requiring you to pay for the repairs)
Are any expenses excluded
from coverage?
For example, a warranty may require you to pay labor
costs or shipping and handling.
How long does the warranty
last?
Some products take longer to exhibit their problems.
What will you have to do to
get repairs?
For example, the warranty might require expensive pre-conditions
to repair, such as the requirement that you ship a heavy product
to a factory for service.
What will the company do if
the product fails?
Find out if the company will repair it, replace it,
or return your money. Repairs take time and it is nice to
be able to get a refund and start over. California law does
not require a manufacturer ti refund money - reapri or replace
at their option.
Does the warranty cover consequential
damages?
Most warranties do not. This means the company will
not pay for any damage the product caused, or for your time
and expense in getting the damage repaired. For example, if
your freezer breaks down and the food in it spoils, the company
will not pay for the food you lost.
Are there any conditions or
limitations on the warranty?
Some warranties will only provide coverage if you maintain
or use the product as directed. For example, the warranty
may cover only personal uses, as opposed to business uses,
of the product. Make sure the warranty meets your needs.
The Magnuson-Moss Act of 1975
requires warranties be available for you to read before you
make a purchase. Under the law, a written warranty must be
written in simple, easily understood language.
As purchaser of a new toaster,
you have the right to have it repaired or serviced during
the warranty period. The warranty period will be extended
by law for the number of whole days the product (in this case,
the toaster) had been out of your hands for warranty repair.
If a defect exists in your toaster within the warranty period,
the warranty will not expire until the defect has been fixed.
The warranty period will also be extended by law if the warranty
repairs have not been performed because of delays due to circumstances
not within your control. If the warranty repairs did not remedy
the defect, and you notify the manufacturer or seller of the
failure of the repairs within 60 days after they were completed,
the warranty period will again be extended by law (Civ. Code
§1795.6)
If you make a reasonable number
of attempts and the defect in your toaster is still not fixed,
you can return the toaster for a replacement or refund, subject,
in either case, to deduction of a reasonable charge for use.
At the time you buy the toaster,
if it comes with a written warranty, the seller must provide
you personally or by listing at the store with the name and
address of all service and repair facilities located within
California, or with the name, address, and phone number of
a service and repair central directory within California,
or with the toll free number of a service and repair facilities
central directory outside California.
Remember, when you buy a product,
save the sales slip and file it with your warranty -- you
may need it to document the date of purchase, or if the warranty
is limited to first purchasers, to prove you were the original
buyer.
Verbal Warranties
Let's say your new toaster did
not come with a written warranty. The salesperson who sold
you the toaster may have made you a verbal promise that the
store would make free repairs if needed. But, be careful here
-- if the promise is not in writing, you may not get the service,
so get it in writing!
"Implied" Warranties
Although written warranties are
not required by law, another type of warranty is. That is
the "implied" warranty, created by state law. The
warranty of merchantability is the most common type of implied
warranty. This warranty means that the seller promises that
the product will do what it is supposed to do. That is, the
law requires that your toaster will toast (Civ. Code §1792).
If the sale is accompanied by an express warranty, the duration
of the applicable implied warranty will be the same length
of time as the express warranty, as long as the duration of
the express warranty is reasonable. In no event shall an implied
warranty have a duration of less than 30 days or more than
three months following the sale of used goods to a retail
buyer. When the express warranty does not state how long it
is to run, an accompanying implied warranty will run in no
case less than 30 days or more than three months. A warranty
period may be extended if, when the product breaks down, the
size, method of installment, or the nature of the break down
prohibits you from delivering it to the service and repair
facility. In this situation, the buyer must notify the manufacturer
or its nearest service and repair facility within the state
in writing of the need for service or repair of the product.
Once the manufacturer receives notice of the broken goods,
it can, at its option, service or repair the goods at the
buyer's residence, pick up the goods for service and repair,
or arrange to transport the goods to its service and repair
facility. All reasonable costs of transporting the goods to
the repair facility and of return to the consumer in this
situation shall be paid by the manufacturer. During the repair
period, the warranty is "tolled." This means that
the warranty period ceases to run. This period begins once
you have either delivered your toaster to the manufacturer
or seller for service or repair or, (in the case of a large
product where such delivery would be impractical, as discussed
above), once you have notified the manufacturer or seller
of the need for service or repair. The period runs up to and
including the date upon which the repair or service is completed.
The warranty period then begins to "run" once again.
If you have fulfilled all the notice or delivery requirements,
regardless of the stated warranty period, the period will
not end if either or both of the following occur:
-
the warranty service or repairs
have not been performed due to circumstances beyond the
buyer's control; and/or
-
the service or repairs performed
did not fix the product and the buyer notified the manufacturer
or seller of this failure within 60 days after the repairs
or service were completed. Once the problem is fixed,
the warranty period will expire in accordance with its
terms, including any extension to the warranty period
for warranty repairs or service.
Waiver of Warranty
If the product you have purchased
is accompanied by an express (written) warranty, the seller
is providing you with a specific guarantee regarding the product.
You may find that a product comes with a card, called a "warranty
registration card." The card may ask for a range of information
about you, including, for example, your age, yearly income
or family size. The card may state that you are "required"
to send in the card within a specified time in order for the
warranty to be enforceable. If you do not send in the card
within the specified time, the manufacturer in this situation
is attempting to "waive" the express warranty accompanying
the product. This is illegal under California law (Com. Code
§2801). Any express and implied warranties accompanying the
product are enforceable even though such a "warranty
registration card" has not been returned to the product
manufacturer.
Under the law, no implied warranty
of merchantability shall be waived, except when consumer goods
are sold on an "as is" or "with all faults"
basis. In order for waiver of the implied warranty to be effective
in this situation, a conspicuous, simple and clearly understandable
writing must be attached to the goods informing you, prior
to the sale, that (1) the goods are being sold on an "as
is" or "with all faults" basis, (2) the entire
risk as to the quality and performance of the goods is with
you, the buyer, and (3) should the goods prove defective following
purchase, you assume the entire cost of servicing or repair.
Resolving Disputes Involving Warranties
To review what we have discussed,
if you are faced with any problems with a product or with
obtaining the promised warranty service, here are a few helpful
suggestions:
-
Read your product instructions
and warranty carefully. Do not expect features or performance
that your product was not designed to give, or assume
warranty coverage that was never promised. Having a warranty
does not mean that you automatically get a refund if the
product is defective. The company is entitled to try to
fix it first. But if you reported a defect to the company
during the warranty period and the product was not fixed,
the company must still correct the problem.
-
Discuss your complaint with
the retailer. Disputes can usually be resolved at this
level. But if you cannot reach an agreement, write the
manufacturer. Your warranty should list the company's
mailing address. Send all letters by certified mail and
keep copies for your records.
-
If none of these actions
resolves your dispute, you may want to consider a lawsuit.
Both federal and state law allow you to sue for damages
or for any other type of relief the court awards, including
legal fees. An attorney will be able to advise you whether
to proceed with a lawsuit
New Cars: the Lemon Law
The "Lemon Law", part
of the Song-Beverly Consumer Warranty Act (Civ. Code §1793.2)
applies only to new cars, vans, or trucks sold in California
or leased for terms exceeding four months. The vehicle must
be leased or purchased primarily for personal, family, or
household use. The Lemon Law does not apply to commercial
or fleet vehicles, motorcycles, motor homes or off-road vehicles.
The Lemon Law provides that you
are generally entitled to a refund if, within the first year
or 12,000 miles (whichever comes first) the warranted problems
cannot be fixed within a reasonable number of attempts. The
dealer may be required to repurchase or replace a vehicle
if a warranty repair cannot be completed within four attempts,
or if the vehicle is out of service for more than 30 days,
while being repaired for any number of reasons.
To obtain a replacement or refund,
the "Lemon Law" requires that:
-
The specific problem is covered
by the warranty;
-
The problem substantially
reduces the use, value, or safety of the vehicle;
-
You notify the manufacturer
directly about the problems you are having with your vehicle,
if you are required to do so;
-
If the warranty requires,
you must submit your dispute to a certified arbitration
program, rather than the courts.
The Lemon Law favors the consumer
in that it presumes you are entitled to a refund or replacement.
Yet, if the manufacturer or its dealer has not made the required
number of unsuccessful attempts (four or more) to repair your
car, or if the manufacturer can prove no reasonable opportunity
to repair, or that it has made a reasonable number of repair
attempts, then the protection of the Lemon Law may not apply.
Nor will the lemon law apply if you abused the car or damaged
it in an accident. If the problem with your car pertains to
safety, the dangerously defective car may be returned even
before the requirements of the Lemon Law are met. A reasonable
number of repair attempts may be as few as one or two in a
situation involving violation of a vehicle equipment safety
standard (such as brake failure or a steering wheel that locks).
In this case you may want to consult a lawyer for advice.
Your responsibilities under the lemon law:
Your new car, whether purchased
or leased, is covered by a warranty. In order to receive the
benefits and protection of the warranty, you must make sure
to service and maintain the car under the terms of the written
warranty and owner's manual that comes with the car. For example,
if you do not add oil when needed and the engine is damaged
as a result, the warranty probably will not cover repair costs.
Also, you should check your warranty
and owner's manual to see which repairs and service are required
to be carried out by the dealer. You may invalidate your warranty
if you perform do-it-yourself repairs and services. Keep copies
of all your repair records to help prove that you have maintained
the car as required by the warranty and/or owner's manual.
Insist that work orders and final invoices for all car repairs
and services list each of the repairs that were performed.
This will show that the car is a "lemon" and that
you have cared for the car as required by the warranty and
owner's manual. If the dealer or manufacturer claims that
a problem is the result of misuse or neglect, and you do not
agree, you may wish to consult with an auto diagnostic center
or competent mechanic in order to obtain an unbiased opinion
of the cause of the problem. If you are required by your warranty
or owner's manual to have repairs carried out by the dealer
and you have a problem with your car, you must allow the dealer
repair it, or at least give them the chance to do so. If they
refuse to repair your vehicle, try to get it in writing then
get it repaired by another mechanic.
If the first attempt at repair
is not successful, let the dealer know right away. Then check
your warranty. You may be required to notify the manufacturer
directly of any need for further repair. The manufacturer's
address should be included in your owner's manual, the warranty,
or available from the dealer.
It is also a good idea to keep
detailed notes of any phone or personal discussions you have
about your car's problems. After an important conversation,
write a short letter to the person you spoke with to confirm
the contents of the discussion. You may want to send the letter
by certified mail, return receipt requested. Keep a copy of
the letter and the receipt. This letter may help you later
to prove what was said and may help avoid or clear up misunderstandings.
Example
Let's say you have made repeated
efforts to repair your car under the terms of your warranty
and/or owner's manual. If you have obtained financing for
the purchase of your car, or if you have leased, let your
lender or leasing agency know about the problems and attempted
repairs. Do not discontinue payments until consulting an attorney.
If you haven't let the manufacturer know, as yet, about the
problems you are having with your car, you should do so at
this point. You should send letters to both the manufacturer
and the dealer describing the problems and requesting needed
further repairs. Make sure to include copies of all repair
orders and invoices.
Dispute Resolution
If you wish to make use of the
Lemon Law to obtain a refund or a replacement vehicle, some
warranties require you to use what is called a "third
party dispute resolution program." This program consists
of arbitration panels set up to resolve difficult car repair
problems and to avoid lawsuits. Before you can use the Lemon
Law in court, you are required to take your complaint to an
arbitration panel if you are notified in writing by the manufacturer
that such a program is available (this information is found
in the warranty or accompanying the warranty), and the program
is "qualified." This means that the program complies
with the Federal Trade Commission (FTC) guidelines and additional
standards required by the Lemon Law.
Arbitration programs are free.
You will normally submit your written complaint to the program
or panel, along with copies of your service records for the
car. If your account of what happened differs from that of
the manufacturer, the arbitrators must allow you to submit
additional information and explain your side of the story.
Your case must normally be decided within 40 days of the time
your complaint was received. You may either accept or reject
the program's decision. If you accept, the manufacturer (or
dealer) must comply with the decision of the arbitrator within
30 days. There is no appeal process available for the manufacturer
(or dealer). If the manufacturer or dealer refuses to comply,
it may be required to pay a penalty of up to three times your
actual losses, reasonable attorney's fees, and court costs
for intentional violation of the Song-Beverly Consumer Warranty
Act. You may wish to consult a lawyer in this situation.
If you do not agree with the
arbitrator's decision, you can reject it and go to court to
assert your right to a replacement, refund, or other relief.
You can also go to court if you have accepted the arbitrator's
decision, but the manufacturer has not promptly complied with
that decision within the 30-day limit.
You should be aware that, while
your case is involved in arbitration, the time limit on your
right to file a lawsuit is extended. In court, a judge may
consider the arbitrator's decision in ruling on your case.
If your car's only defects are
ones which do not substantially affect its use, value, or
safety, you are not entitled to refund or replacement under
the Lemon Law. But, if the defect is covered by your warranty,
you have the right to have it repaired. If the manufacturer
or dealer cannot or will not repair the defect, you can have
the car repaired elsewhere, then file suit in Small Claims
Court to recover reasonable repair costs from the manufacturer.
Used Cars: Buying From a Dealer
If you are buying a used car
from a dealer, you may benefit from the Federal Trade Commission's
"Used Car Rule" (16 CFR 455). The Rule requires
all used car dealers to place a large sticker, called a "Buyer's
Guide" in the window of each used car they offer for
sale. The Buyer's Guide will provide you, the prospective
purchaser, with the following information:
-
Whether the vehicle comes
with a warranty, and if so, the specific protection offered
by the warranty;
-
Whether the car is sold without
warranty ("as is") or with "implied warranties"
only.
-
That you should ask to have
the car inspected by your own mechanic before you buy;
-
That you should get all promises
made by the dealer in writing;
-
What some of the major problems
are that might occur in any car.
When you purchase the used car
from the dealer, make sure you receive the original or an
identical copy of the Buyer's Guide that the dealer placed
in the window of the car you bought.
Warranty
Make sure that the Buyer's Guide
indicates any changes in warranty coverage that you verbally
negotiated with the dealer. The Guide becomes part of your
sales contract and its provisions override any contrary provisions
in the sale contract.
Dealers are required to post
a Buyer's Guide on all used vehicles (except motorcycles).
A used car is defined as one which has been driven further
than the distance required to deliver it to the dealership
as a new car or to test drive it.
One of two boxes will be checked
on the Buyer's Guide. One will be marked "As Is -- No
Warranty" and the other "Warranty."
As Is -- No Warranty -
Means the used car is sold without a warranty. This means
that, should you have problems with the car after you buy
it, you will have to pay for the repairs yourself regardless
of any oral statements made. The dealer has no further responsibility
for the car once the sale is complete.
Written Warranty - If
a written warranty is offered on a used car, this will be
indicated on the Buyer's Guide. Before you purchase the car,
read the warranty carefully to see what is and what is not
covered. Check the percentage of repair costs the dealer will
pay for labor and parts, check which specific systems are
covered, and check the duration of the warranty for each covered
system. A list of descriptive names for the major systems
of a car is found on the back of the Buyer's Guide.
Note: If the dealer makes
any promises to repair the car that are not listed on the
Buyer's Guide, ask the dealer to add the promises, in writing,
to both the Buyer's Guide and the sales contract.
Full/Limited Warranty
The warranty may be "full"
or "limited." A "full" or "limited"
warranty need not cover the entire vehicle. The dealer can
specify only certain systems as covered under the warranty.
A "full" warranty provides the following:
-
Warranty service will be
provided to anyone who owns the vehicle during the warranty
period when a problem is reported.
-
Warranty service will be
provided without cost, including return of the vehicle
or removal and re installation of the system covered by
the warranty, when necessary.
-
If the dealer is unable,
after a reasonable number of attempts, to repair the vehicle
or system covered by the warranty, the dealer will provide
either a replacement or full refund, the choice being
left up to you.
-
Warranty service is provided
without requiring you to return a warranty registration
card.
If any of the provisions listed
above are absent, the warranty is "limited." When
you buy a car with a "limited" warranty, you should
realize that there are costs or responsibilities that the
dealer will not assume for systems covered by the warranty.
Manufacturer's Warranties
It is also possible that the
original, unexpired manufacturer's warranty still applies.
This will be indicated on the Buyer's Guide for the car. You
should look at the specific provisions of the unexpired warranty
before you buy, to see what is and what is not covered. The
dealer is not required to offer it's own warranty in addition
to the provisions of the unexpired warranty. For a more in
depth discussion, see the section in this pamphlet on consumer
warranties.
Mechanic's Inspection Before
You Buy -- Before you buy a used car, you should ask the
dealer whether you may have the car inspected by your own
mechanic either at the car lot or elsewhere. It may not be
possible for the dealer to allow such an inspection off premises,
due to insurance or other regulations, but on premises inspections
should present no such problems. An independent inspection
will allow you to find out about the mechanical condition
of the car before you buy it!
Service Contracts -- A
service contract may be offered to you when you buy your car.
This contract may be called an "extended warranty,"
although it is not a warranty which would be included in the
price of the vehicle. The service contract comes at extra
cost.
Before you pay for a service
contract, make sure to do the following:
-
Make sure that any warranty
that comes with the car does not cover the repairs you
would get under the service contract;
-
Determine whether the car
will need repairs, and the cost of those repairs;
-
Find out how long the service
contract will be in effect;
-
Investigate the reputation
of the dealer offering the service contract;
It is important to note that
when you purchase a service contract within 90 days of buying
a car, federal law prohibits the dealer from disclaiming implied
warranties on the systems covered in that service contract.
To illustrate: if you buy a car "as is", the car
will not normally be covered by implied warranties. But, if
you also buy a service contract covering the engine for six
months, you automatically get implied warranties on the engine
as well, which may give you additional protection beyond the
scope of the service contract.
Used Cars: Buying From a Private Seller
If you buy a used car from a
private individual, for example, through a classified newspaper
ad, the sale is not covered by the FTC Used Car Rule we have
discussed. Therefore, private sellers are not required to
use the Buyer's Guide. In most private sales, the car is sold
"as is" and there will be no written contract with
specific repair provisions. The private seller, in these cases,
will have no further responsibility for the car following
the sale. If you do have a written contract from a private
seller, the seller is under a legal obligation to fulfill
any promises in the contract.
It is also possible that the
car is covered by an unexpired manufacturer's warranty or
a service contract. Before you buy, make sure to ask the seller
to allow you to examine any manufacturer's warranty or service
contract which is still valid for the car. As with a used
car purchased from a dealer, it is important to have the car
inspected by an independent mechanic before you buy.
There are three types of landlord/tenant
relationships. These are periodic, term of years, and at will
leases. An example of a periodic tenancy is the typical month
to . The period of the lease does not need to be a month,
but can be any length of time (3 months, 1 year, 5 year, etc.)
When the lease period ends, a new lease period automatically
begins, for the same length of time, unless either party tells
the other party that the lease will end, so long as adequate
notice is given.
A term of years lease is one
that the start date and the stop date are set out in the agreement
(lease). The length does not need to be a set number of years,
but only a determinable number of days (30 days, 180 days,
1 year, 5 years). At the end of the lease period, no new lease
exists, the landlord/tenant relationship has ended, unless
both parties have agreed to continue the lease for another
period.
An "at will" lease
is usually a verbal agreement that the tenant will be allowed
to stay at the residence until either party decides to end
the relationship. If it is no longer the desire of either
party to continue the lease, it is ended. This type of lease
also ends automatically when either party dies.
Your rental or lease agreement
does not have to be in writing unless you are leasing for
a period longer than a year. Nevertheless, it is advantageous
to put your agreement in writing, for both your and your landlord's
protection.
When looking to lease a residence,
you should carefully consider the advantages and disadvantages
of each type of lease before you commit yourself. While a
"term of years" lease does tie you to a long-term
commitment, it offers you certain protection that a month-to-month
(periodic) rental agreement does not provide.
Under a fixed term lease, you
have the assurance that you can remain in the residence for
a specified period of time and that the rent cannot be raised
during this time unless the lease states otherwise. In contrast,
under a periodic rental agreement, your landlord may be able
to evict you, raise your rent or change other terms of the
agreement. Note that the length of the notice period for raising
the rent must be at least as long as the period between your
rental payments, normally one month.
Know Your Landlord
It is possible that the person
you talked with about renting or leasing may not be the landlord
(owner), but, only the representative of the landlord or from
a rental management company which has been hired by the landlord
to manage the property. It is very important that you find
out who your landlord is or who is legally empowered to act
on his/her behalf. An agreement you make with a manager may
not be honored by the landlord. Also, if you have problems
with the manager, you may need to contact the landlord to
help resolve the dispute.
If you are dealing with a multi-unit
dwelling such as an apartment complex, by law, the owner or
his/her representative must disclose the name and address
of each person who is authorized to manage the premises, and
each person who is an owner or who is authorized to act for
or on behalf of the owner to receive legal notices and demands
(Civ Code §1962 et seq.). If you have a written rental agreement
or lease, this information must be contained in the rental
or lease document. If you have only an oral agreement, and
you make a written request, this information must be provided
to you in writing. Even if you do not request the information,
it must still be posted in two conspicuous places, such as
hallways, lobbies or elevators.
Make Sure You Understand Your
Agreement
It is worth your time to get
every agreement and statement in writing, even in the case
of an agreement of less than one year's duration, for which
the law does not require a written agreement. Unfortunately,
tenants have been taken advantage of because they didn't get
their agreement in writing.
Deposits/Inventory Checklist
Normally, once you have located
the place you hope to rent or lease, you will pay your landlord
or his/her representative a "holding deposit". This
deposit is usually non-refundable, but is applied to the first
month's rent. It serves to "hold" the premises for
you to the exclusion of other potential tenants, until you
pay, for example, first month's rent and any required deposits.
Make sure that the purpose of the holding "deposit"
is clear and in writing.
Before you pay your first rental
or lease payment and begin occupancy of the premises, you
should closely inspect the condition of your prospective residence.
You and your landlord (or your landlord's legal representative)
should go through the premises together with an inventory
checklist so that you are able to agree on the condition of
things before you move in. Both you and your landlord should
keep a copy of the checklist. Have the landlord sign the checklist
so that later on you won't be blamed for causing any of the
damage you found. When you move out, you should go through
the premises again and make note of any changes. If it is
possible, take pictures of any problem areas when you move
in. This can be very helpful when it comes time to discuss
the return of your cleaning and security deposit with your
landlord.
If there are problems with the
residence, try to have the landlord make a written promise
to make all needed repairs by a certain date. If you can only
get the landlord to give you an oral promise, try to find
witnesses to his/her statements. The landlord may agree to
reimburse you for labor and materials if you agree to carry
out repairs. Again -- get it in writing!
Once you have completed your
inspection of the property, and have decided to move in, you
will normally be asked to pay a "security deposit".
Under the law, a "security deposit" is defined as
money held by the landlord as security for either: (1) compensation
for unpaid rent; (2) repair of damages caused by the tenant
(apart from ordinary wear and tear); (3) cleaning of the premises
upon termination of the tenancy (if not satisfactorily cleaned
by the tenant) (Civ. Code §1950.5(e)). Often, the landlord
will request a variety of deposits: for example, security,
cleaning, key, pet, parking, and last month's rent. All of
these different deposits should be considered part of the
security deposit. This is because, by law, the landlord cannot
require more than two month's rent for the security deposit
on an unfurnished apartment, and more than three month's rent
on a furnished apartment, unless special circumstances exist
(Civ. Code §1950.5(c)). In publicly subsidized housing, the
maximum deposit is one month's rent. If the last month's rent
is required, it is considered part of the security deposit,
even if the landlord lists it separately -- this will help
you avoid paying too high a security deposit.
Note that, by law, the landlord
cannot automatically charge a tenant for painting and cleaning
at the end of a tenancy because it is the landlord's "policy"
to do such cleaning at the end of all tenancies. Additionally,
the landlord is not legally permitted to deduct for ordinary
wear and tear to the premises. Rather, he/she must prove that
you damaged or damaged the premises beyond ordinary wear and
tear, or left the premises dirty, if he or she wants to deduct
from the security deposit (Civ. Code §1950.5(b)(2)).
If the landlord wants to charge
you for any cleaning or repairs, he/she is legally required
to provide you with an itemized list of the required repairs.
You must receive the portion of the deposit owed you within
three weeks of the date you move out (Civ. Code §1950.5(f)).
If you don't receive your refund
within three weeks, you should contact your landlord, in writing,
preferably by certified mail, return receipt requested, to
find out why you haven't received a refund. Keep a copy of
your letter.
If you disagree with your landlord's
actions regarding your refund, you can file a lawsuit in the
Small Claims Court. If you can show that your landlord's refusal
to refund your deposit was intentional and in bad faith, rather
than the result of an honest dispute, you may be able to collect
"punitive damages" (i.e., money collected from the
landlord in order to "punish" him/her) against your
landlord (Civ. Code §1950.5(k)).
Sale of Your Apartment Building
Note also that if your landlord
sells the premises while you are living there, he/she must,
within a reasonable time and after deducting the proper amounts
from your deposit, either: (1) transfer the remainder of your
deposit to the new landlord, and notify you of the transfer
and the new landlord's name and address; or (2) return the
remainder of your deposit to you. The landlord must use either
certified mail or personal delivery to notify you and must
provide you with an itemized written account if he/she returns
only a part of the deposit to you.
Moving Out -- When It's Your Decision
If you decide to move out, the
law requires you to give a written 30-day notice if you have
a month-to-month rental agreement, so long as your rental
contract does not stipulate to a shorter notice period of
not less than seven days. Your notice of departure does not
have to correspond to a due date for rent. To illustrate this
point, you can pay rent on June 1, give 30 days notice on
June 10, and move out July 10. This means, of course, that
you must pay rent for the first 10 days of July. You must
pay for every additional day you remain on the premises (Civ.
Code §1946). If proper notice is not given, you may be required
to pay rent for the next rental period.
If you breach your month-to-month
rental agreement, the landlord is under a legal obligation
to make a reasonable effort to re-rent the premises. When
a new tenant moves in, you are no longer responsible for the
rent for the remainder of the 30-day period. The landlord
can only charge you for the time the premises were vacant
and for any expenses related to re-renting the apartment,
such as advertising. (California Safety Center, Inc.
v. Jax Car Sales of California, Inc., 164 Cal. App.3d 992
(1985)).
Eviction: When You're Forced to Move Out
If you have a month-to-month
rental agreement, the landlord must give you written notice
of eviction. If you do not comply with the notice, the landlord
is not legally permitted to simply enter your residence and
physically remove you or lock you out. Rather, the landlord
must first sue to have you evicted, in a lawsuit called an
"unlawful detainer" action. These suits are always
filed in Municipal Court.
If you are served with a summons
in an unlawful detainer action you will normally have only
five days (including weekends) to file a written response
before a decision may be entered against you. If you do not
file a written response to your landlord's complaint, the
landlord can request a "default" judgment from the
court against you without a formal trial and without the judge
ever hearing your side of the case. After a decision has been
rendered by a judge, it is difficult for a tenant to avoid
being evicted.
If you do respond to your landlord's
unlawful detainer complaint within the required period of
time, you and your landlord then go to court and each explain
your side of the situation to the judge or jury.
If you lose your case, you must
move out. If you refuse to move, the landlord is granted a
"writ of possession," and a notice will either be
delivered to you or posted on your door. Five days later,
if you still haven't moved out, the Sheriff can physically
evict you from the property.
Tenant's Defenses to Eviction
You were given insufficient
notice.
By law, a landlord can give several
types of written notice. The tenant, if given insufficient
notice of eviction according to guidelines set out below,
can defend against the landlord's attempt to evict him/her:
Three-day notice - Three-day
notice is required when you haven't paid the rent, have damaged
or destroyed the property, or have violated the rules of the
rental agreement or lease. The three-day notice must clearly
state why you are being evicted and what you must do in order
to stay, if the problem is correctable. If you correct the
problem or the landlord changes his/her mind, the three-day
notice is canceled, the lease or rental agreement continues
in effect, and you don't have to leave.
30-Day Notice - In a month-to-month
rental agreement, 30 days notice is required and in a week-to-week
rental agreement, seven (7) days notice is required. This
is true unless you have agreed to receive less notice, with
the least notice being seven (7) days. A 30-day notice is
also required when your residence has been involuntarily sold,
for example, at a judgment or foreclosure sale.
If your landlord voluntarily sells your residence, you should
be aware that the new landlord is required to assume your
lease or rental agreement under the same terms as your agreement
with the previous landlord.
180-Day Notice - A 180
day notice is required when an apartment is being converted
into a condominium. Notice may be given at any time during
the conversion process. You are entitled by law to a 90-day
first-option to buy the unit you are living in after final
approval is given for the conversion, you get the first chance
to buy the unit if you accept within ninety (90) days. If
your building is being converted to condominiums, you may
want to look into local ordinances which may provide you with
additional protection.
Repair and Deduct Remedy
Your landlord may try to evict
you, claiming that you did not pay all or any of your rent.
You may defend against this eviction if you used the rent
money to correct violations of building and/or housing codes
in your residence. As a tenant under a rental agreement or
lease, you have what is called an "implied warranty of
habitability" as to your residence. This means that your
landlord must keep the premises in a condition fit for human
occupancy. You cannot sign away your right to this warranty
of habitability. Your landlord is obligated by law to repair
all problems which fall under his/her minimum obligations,
unless the damage was caused by your own lack of care. A few
examples of the landlord's minimum obligations, from California's
Civil Code §1941, include that:
-
There are no leaks when it
rains, and no broken doors or windows.
-
The plumbing works, including
hot and cold water. There must be a working sewer or septic
tank connection.
-
The heater must work and
be safe.
-
The lights and wiring must
work and be safe.
-
Floors, stairs, and railings
must be in good repair.
-
Once rented, your place must
be clean, without trash, garbage, or rats or other pests.
-
The landlord must provide
enough covered cans or bins for garbage.
If you have a problem with any
of the above, you should first give your landlord oral or
written notice of the problems. Although either form of notice
is sufficient, it is preferable to give notice in writing,
in order that you later have proof that such notice was given.
You should then wait a "reasonable"
time for the needed repairs to be made. What is a reasonable
time depends on the nature of the problem about which you
have complained to the landlord. That is, if the problem is
that you do not have heat in your place and it is during the
cold months, a few days wait may be considered "reasonable."
By law, 30 days is "presumed" reasonable. Thus,
if you wait less than 30 days and the case goes to court,
you are required to prove that the shorter waiting period
was reasonable. If the repairs are not made by the landlord
within a reasonable time, you may have them repaired yourself.
Keep a record of the costs of the repairs, then deduct them
from your next rental payment. This is called "repair
and deduct."
If you make the repairs on your
own after waiting a reasonable time for the landlord to do
the repairs of which he/she was notified, you may not deduct
more than one month's rent to pay for the repairs. Nor can
you use this right to withhold rental payment to pay for repairs
more than two times in a 12-month period. You cannot give
up your legal right to repair and offset unless your rent
was lowered because you agreed to do things your landlord
is normally required to do (e.g., to repair your premises).
Note that if you made an agreement of this nature under pressure
in order to get your place, the agreement is not binding.
If your residence doesn't meet
the required standards of habitability, you can stop paying
rent until the needed repairs are made or you have the option
of moving out without the responsibility to pay any further
rent. HOWEVER, YOU SHOULD TALK TO A LAWYER BEFORE WITHHOLDING
RENT OR MOVING OUT, BECAUSE THESE OPTIONS CAN BE VERY COMPLICATED.
You will probably be advised by your lawyer to deposit the
withheld funds into an "escrow" account, to show
you are willing to pay the rent once the landlord carries
out repairs. If your landlord takes you to court, you can
argue that you have the right to withhold some rent to get
the landlord to make repairs.
That The Eviction is "Retaliatory"(to punish)
If you have complained about
the uninhabitable condition of your place or have given notice
requesting the landlord to make repairs or you will deduct
their costs from the rent, your landlord cannot evict you,
decrease your service, or force you to leave involuntarily
within six (6) months of your action if his/her purpose is
to punish you for exercising your rights. The six (6) month
period protection can be used only once in any 12-month period.
Note that if you feel you have been unfairly treated after
the six (6) months, you should consult a lawyer because in
some cases, you may be protected for a longer period.
Additionally, it is illegal for
the landlord to retaliate or threaten to retaliate against
you at any time because you belong to a tenants' union or
organization, or because you have lawfully exercised any of
your legal rights. In these situations, there is no limit
to the number of times you can use this protection, and no
given time limit when your protection ends.
If your landlord has illegally
retaliated against you by threatening eviction, you may sue
him/her. If you win, the landlord could be liable for your
actual damages (i.e., hotel costs), reasonable attorney's
fees (if either you or the landlord requests these fees at
the beginning of the lawsuit), and punitive damages from $100
to $1,000 if the landlord's retaliation was done with malice.
Today, buying on credit is a
common practice. Credit can also allow you to borrow money,
or make a major purchase, such as buying a car. But remember,
you should only use credit if you can afford it and can repay
your debt.
How Can You Establish Credit?
If you have sufficient financial
resources, there are several approaches you can take to start
to build a "credit history". If you have never used
credit before, you may want to open a savings or checking
account in your name. You can also acquire credit or charge
cards in your name, or establish a credit line at your bank.
If you maintain active bank accounts, pay your charge card
bills on time, and pay back your bank loan, you should find
that your credit allowance will increase with time.
Lenders will often obtain information
about your "credit worthiness" or "credit history"
from a consumer reporting agency, such as a credit bureau.
If the credit report is negative, you may have a difficult
time obtaining credit. To find out if you have any credit
history, ask your bank or other creditor the name and address
of the credit reporting bureau that they use. You have the
right to obtain a copy of your credit history report from
the credit reporting bureau at anytime for a small fee, or
for free if you have been denied credit based on your credit
report.
What Can You Do If Your Credit Application is Denied?
Under the Fair Credit Reporting
Act (15 USCS §1681 et seq.), if your credit application was
denied because of information supplied by a credit bureau,
that agency's name and address must be supplied to you.
While the law does not require
that a creditor give you credit, it does force the creditor
to act fairly and without discrimination against you because
of: age (with limited exceptions), sex, marital status, race,
color, religion, national origin, receipt of public income
(i.e. welfare, social security), or because you have previously
exercised your legal rights (such as filing billing errors).
See the Equal Credit Opportunity Act (15 USCS §1691 et seq.).
You have the legal right to know
what your credit report says. The credit bureau is required
by law to tell you about every piece of information in the
report, and in most cases, the sources of that information.
If the credit bureau uses codes in your credit report, you
must be given an explanation of the codes used. The credit
bureau is not required to give you a copy of the report, although
many will do so. If you find that the information contained
in your credit report is inaccurate or incomplete, you should
notify the credit bureau by mail and explain the reason you
find your file to be inaccurate. You may wish to send this
letter by certified mail, return receipt requested, in order
to have proof that the bureau received your letter. Upon receipt
of your letter, the credit bureau is required either to reinvestigate
your history or notify you that it believes your dispute to
be groundless and frivolous. The credit bureau must let you
know within five days if it believes your dispute is frivolous
and therefore will not reinvestigate your file. The bureau
is required to state its exact reasons for its decision not
to reinvestigate (15 USCS §1681(i)). If the bureau has made
the decision not to reinvestigate, you have the legal right
to file a statement of 100 words or less stating why you believe
the information in your credit report to be inaccurate or
misleading. The bureau is required by law to include your
statement in your credit history and provide it to creditors
who request information about you.
If the credit bureau finds that
your dispute is valid and reinvestigates your file, it must
correct your credit history and notify you that corrections
have been made. You also have the right to request that the
bureau send either the corrected information or your statement
to anyone who has received a credit history on you within
the last six months.
Consumer Credit Contracts
A Federal Trade Commission rule,
the "Credit Practices Rule"(16 CFR 444 et seq.)
in effect since March 1, 1985, covers consumer credit contracts.
The Credit Practices Rule prohibits many creditors from including
certain provisions in consumer credit contracts. It also requires
creditors to provide a written notice to consumers before
they co-sign obligations for others, about their potential
liability if the other person fails to pay.
If you agree to be a cosigner
for someone else's debt, you are guaranteeing to pay for that
debt if that person fails to pay the debt. The Credit Practices
Rule requires that you be given a notice explaining the responsibility
you are undertaking to repay a debt which may include payment
of late fees or collection costs, and the fact that, if the
debt is ever in default, that fact may become part of your
credit record. A creditor can charge a late fee if you do
not make your loan payment on time. But, under the rule, it
is now illegal for a creditor to charge you late fees or payments
just because you have not as yet paid the late fee you owe.
Credit Cards
Now that you have obtained credit
in the form of one or more credit cards, what do you do if
you have a problem with inaccurate billings for purchases
on your credit card, and what happens if your card is lost
or stolen?
Disputed Amounts
Credit card billing errors do
occur, but they are simple to resolve if you know your rights
under the Fair Credit Billing Act (15 USCS §§1601, 1602, 1637,
1666 et seq.) Under the Act, if you feel a credit card billing
error has occurred, you must write the bank or retailer who
issued the card. Your notice must be received within 60 days
after the bill containing the error was mailed. You should
include the following information in your letter: your name
and account number, the date, type and dollar amount of the
charge you are contesting, and why you think there was a mistake.
Make certain you send your letter
to the correct office address. You can often dete |