Consumer’s Resource Handbook

Table of Contents

Acknowledgments iv

Using this Handbook 1 What’s in the Handbook 1 Other Sources of Help 2 Other Consumer Information 4

Part I. Buying Smart 5 Protecting Yourself 5 Red Flags of Fraud 6 Complaining Effectively 6 Writing a Complaint Letter 7 Sample Complaint Letter 8 Consumer Tips 9 Car Repair, Purchase, Renting and Other Concerns 9 Mail Order 12 Mail Fraud 13 Telemarketing 13 Calls That Cost: 900 Numbers and Other Pay-Per-Call Services 14 Door-to-Door Sales 15 Home Improvement 16 Home Financing 17 Selecting a Financial Institution 18 Credit 19 Consumer Privacy 22 Advance Fee Scams 23 Special Contracts 23 Travel Scams 25 Rent-To-Own 25 Product Safety and Recalls 26 Nutrition Labeling 27

Part II. Consumer Assistance Directory 29 Corporate Consumer Contacts 29 National Consumer Organizations 56 Car Manufacturers 59 Better Business Bureaus 63 Trade Association and Other Dispute Resolution Programs 67 State, County and City Government Consumer Protection Offices 70 State Agencies on Aging 83 State Banking Authorities 87 State Insurance Regulators 89 State Securities Administrators 91 State Utility Commissions 93 State Vocational and Rehabilitation Agencies 95 State Weights and Measures Offices 99 Military Commissary and Exchange Offices 102 Federal Information Center 104 Selected Federal Agencies 105 Federal TDD Directory 111

Index 116

Acknowledgments

The U.S. Office of Consumer Affairs wishes to express its gratitude to the members of the focus group which provided many ideas and suggestions for this edition of the Handbook.

Mr. John Barker National Consumers League

Dr. Elizabeth Brabble School of Business Howard University

Mr. Emmitt Carlton National Association of Attorneys General

Mr. Hoyte Decker U.S. Department of Transportation

Ms. Anna Flores National Association of Consumer Agency Administrators

Ms. Susan Giesberg President, National Association of Consumer Agency Administrators Mr. George Idelson Consumer Affairs Letter

Ms. Denise Kelleher Head of Reference Arlington County (VA) Libraries

Ms. Nellie Miller Montgomery County (MD) Office of Consumer Affairs

Ms. Jean Otte Corporate Vice President National Car Rental

Ms. Shirley Rooker Call for Action

Ms. Diane VanLonkhuyzen Food Safety and Inspection Service U.S. Department of Agriculture

Ms. Dianne Ward Council of Better Business Bureaus, Inc.

Ms. Gilda Warnick D.C. Department of Consumer and Regulatory Affairs

Using this Handbook

The Consumer’s Resource Handbook is divided into two sections. Part I, 'Buying Smart,' lists tips on getting the most for your money, handling your own complaint and writing a complaint letter. Part I also provides tips on several consumer issues, including protecting personal privacy and preventing credit card fraud.

Part II of the Handbook, which is updated every two years by the U.S. Office of Consumer Affairs (USOCA), lists offices you can contact for help with consumer problems or questions. This section includes 'National Consumer Organizations,' 'Corporate Consumer Contacts,' 'Car Manufacturers,' 'Better Business Bureaus,' 'Trade Association and Other Dispute Resolution Programs,' 'State, County and City Government Consumer Offices,' 'Selected Federal Agencies,' and 'Military Commissary and Exchange Contacts.' Check the 'Table of Contents' for a complete list of the offices in this part of the book.

There is a subject 'index' at the back of the Handbook to help you locate information about specific topics.

What’s in the Handbook

National Consumer Organizations

There are a number of national organizations whose missions are defined as consumer assistance, protection and/or advocacy. Several of these organizations assist consumers directly; others are interested in hearing from consumers about problems and concerns; most, though not all, develop educational materials for consumers. Addresses, telephone numbers and descriptions of more than 30 of these organizations are listed in the National Consumer Organizations' section of this Handbook, beginning on page 56.

Corporate Consumer Contacts

Many companies have consumer affairs or customer relations departments to answer questions or help resolve consumer complaints.

The addresses and telephone numbers of more than 550 companies are listed in the 'Corporate Consumer Contacts' section of this Handbook, beginning on page 29. If you write to the company, you may use the sample letter on page 8 as a guide for your own letter.

Car Manufacturers

Most foreign and American car manufacturers have national or regional offices which handle consumer complaints not resolved by your local car dealer. The list of 'Car Manufacturers' begins on page 59.

Better Business Bureaus

There are approximately 63 Better Business Bureaus (BBBs) in the United States. These bureaus are non-profit organizations, sponsored by private local businesses. They offer a variety of services. These services include general information on products or services, reliability reports, background information on local businesses and organizations, and records of a company’s complaint-handling performance.

The Council of Better Business Bureaus, which is sponsored by national companies, also offers consumer education programs and reports on charitable organizations. The address for the council and a list of BBBs operating in the United States begin on page 63.

Trade Association and Other Dispute Resolution Programs

There are nearly 40,000 trade and professional associations in the United States, representing a variety of interests (for example, banking, insurance, clothing manufacturing) and professions (for example, accountants, lawyers, doctors, therapists).

Some of these associations and their members have established programs to help consumers with complaints not resolved at the point of purchase.

Trade associations have various consumer functions, which are described in National Trade & Professional Associations of the United States. Check your local library for this book and related sources of help.

A list of 'Trade Association and Other Dispute Resolution Programs' begins on page 67.

State, County and City Government Consumer Offices

State and local consumer protection offices can help you resolve consumer complaints and provide you with consumer education information. These agencies might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professions, promote strong consumer protection legislation, provide educational materials and advocate in the consumer interest. It is important to report complaints and suspected frauds and misrepresentations to these governmental agencies. Consumer complaints form the basis of most consumer protection law enforcement actions.

If you want to file a complaint, call your local consumer protection office to learn what you need to do. A list of state, county and city government consumer protection offices begins on page 70.

Many states also have special commissions and agencies to handle consumer questions and complaints about aging, banks, insurance, utilities, vocational and rehabilitation services, weights and measures, and securities. These agencies are listed separately, beginning on page 83.

In addition, a variety of other helpful community services might be available in your area. For example, county and state Cooperative Extension Services offer information about health, safety, product comparisons, financial planning and nutritional needs. Information about these and other state and local services can be found at your library and in the telephone directory in the city, municipal, county or state government listings.

Selected Federal Agencies

Many Federal government agencies can help you with consumer questions and complaints. A number of these agencies have enforcement authority and/or complaint-handling responsibilities. The Federal agencies listed, beginning on page 105, respond to consumer complaints and inquiries.

A list of Federal agencies with Telecommunications Devices for the Deaf (TDDs) begins on page 111.

Military Commissary and Exchange Contacts

Interested consumers will find a list of 'Military Commissary and Exchange Contacts' on page 102. The list includes the regional offices and headquarters for all the Armed Forces Exchanges and Commissaries.

Other Sources of Help

Libraries

The local library can be a good source of help. Many of the publications mentioned in this Handbook can be found in public libraries. Some university and other private libraries also allow individuals to use their reference materials. Check your local telephone directory for the location of nearby libraries. Media Programs

Local newspapers and radio and television stations often have 'Action Line' or 'Hot Line' services. These programs might be able to help consumers with their problems. Sometimes these programs, because of their influence in the community, are successful in helping to resolve consumer complaints. Some action lines select only the most severe problems or those that occur most frequently. They might not be able to handle every complaint.

To find these services, check with your local newspapers, radio and television stations, or local library.

Occupational and Professional Licensing Boards

Many state agencies license or register members of various professions, including doctors, plumbers, electricians, car repair shops, employment agencies, beauticians, and television and radio repair shops. In some states, local consumer agencies license or register some professions.

In addition to setting licensing standards, these boards also issue rules and regulations; prepare and give examinations; issue, deny or revoke licenses; bring disciplinary actions; and handle consumer complaints.

Many boards have referral services or consumer education materials to help you select a professional. If you have a complaint and contact a licensing agency, the agency will contact the professional on your behalf. If necessary, they might conduct an investigation and take disciplinary action against the professional. This action can include probation or license suspension or revocation.

To find the local office of an occupational or professional licensing board, check your local telephone directory under the headings of 'Licensing Boards' or 'Professional Associations,' or look for the name of the individual agency. If you need help locating the right office, contact your state or local consumer office.

Legal Help

Please note that some of the sources of help listed in the Consumer’s Resource Handbook have a policy of declining complaints from consumers who have sought prior legal counsel. Small Claims Court

Small claims courts were established to resolve disputes involving claims for small debts and accounts. While the maximum amounts that can be claimed or awarded differ from state to state, court procedures generally are simple, inexpensive, quick and informal. Court fees are minimal, and you often get your filing fee back if you win your case. Generally, you will not need a lawyer. In fact, in some states, lawyers are not permitted. If you live in a state that allows lawyers and the party you are suing brings one, do not be intimidated. The court is informal, and most judges make allowances for consumers who appear without lawyers.

Remember, even though the court is informal, the ruling must be followed, just like the ruling of any other court.

If the party bringing the suit wins the case, the party who lost often will follow the court’s decision without additional legal action. Sometimes, however, losing parties will not obey the decision. In these cases, the winning party can go back to court and ask for the order to be 'enforced.' Depending on local laws, the court might, for example, order property to be taken by law enforcement officials and sold. The winning party will get the money from the sale, up to the amount owed. Alternatively, if the person who owes the money receives a salary, the court might order the employer to garnish or deduct money from each paycheck and give it to the winner of the lawsuit.

Check your local telephone book under the municipal, county or state government headings for small claims court offices. When you contact the court, ask the court clerk how to use the small claims court. Many state and local consumer agencies have consumer educational material to prepare you for small claims court (see page 70). To better understand the process, sit in on a small claims court session before taking your case to court. Many small claims courts have created dispute resolution programs to help citizens resolve their disputes. These dispute resolution processes (e.g., mediation and conciliation) often simplify the process. For example, in mediation, both people involved in the small claims dispute meet, sometimes in the evenings or on weekends, and with the assistance of a neutral, third-party mediator, discuss the situation and create their own agreement.

Research indicates that if both people show up for the mediation, 85%-90% of the time an agreement is reached. Just as importantly, researchers learned in follow-up, six months after the session, that 85% of the agreements were 'substantially fulfilled.'

Considering this, when you contact your small claims court, ask first about their mediation or conciliation process.

For additional information about dispute resolution, contact the American Bar Association, Standing Committee on Dispute Resolution, 1800 M Street, N.W., Washington, D.C. 20036, (202) 331-2258.

Legal Aid

Legal Aid offices help individuals who cannot afford to hire private lawyers. There are more than 1,000 of these offices around the country staffed by lawyers, paralegals and law students. All offer free legal services to those who qualify. Funding is provided by a variety of sources, including Federal, state and local governments and private donations. Many law schools nationwide conduct clinics in which law students, as part of their training, assist practicing lawyers with these cases. Legal Aid offices generally offer legal assistance with such problems as landlord-tenant relations, credit, utilities, family issues (e.g., divorce and adoption), foreclosure and home equity fraud, social security, welfare, unemployment and workmen’s compensation. Each Legal Aid office has its own board of directors which determines the priorities of the office and the kinds of cases handled. If the Legal Aid office in your area does not handle your type of case, it should be able to refer you to other local, state or national organizations that can provide advice or help. Check the telephone directory to find the address and telephone number of the Legal Aid office near you. If you would like a directory of Legal Aid offices around the country, contact the National Legal Aid and Defender Association, 1625 K Street, N.W., 8th Floor, Washington, D.C. 20006, (202) 452-0620.

Legal Services Corporation

The Legal Services Corporation (LSC) was created by Congress in 1974. There are LSC offices in all 50 states, Puerto Rico, the Virgin Islands, Guam and Micronesia. To find the LSC office nearest you, check the telephone directory, call the Federal Information Center (FIC) listed on page 104, or call the LSC Public Affairs Office at (202) 863-4089. If you wish to buy a full directory of all LSC programs, write or call:

Public Affairs Legal Services Corporation 400 Virginia Avenue, S.W. Washington, D.C. 20024-2751 (202) 863-4089

Finding a Lawyer

If you need help finding a lawyer, check with the Lawyer Referral Service of your state, city or county bar association listed in local telephone directories.

Complaints about a lawyer should be referred to your state, county or city bar association.

Other Consumer Information

Consumer Credit Counseling Services

Counseling services provide assistance to individuals having difficulty budgeting their money and/or meeting necessary monthly expenses. Many organizations, including credit unions, family service centers and religious organizations, offer some type of free or low-cost credit counseling.

The Consumer Credit Counseling Service (CCCS) is one non-profit organization that provides money management techniques, debt payment plans and educational programs. Counselors take into consideration the needs of the client, as well as the needs of the creditor, when working out a debt repayment plan. You can find the CCCS office nearest you by contacting the National Foundation of Consumer Credit, Inc., 8611 Second Avenue, Suite 100, Silver Spring, MD 20910-3372, 1 (800) 388-CCCS (toll free). Consumer Groups

Private and voluntary consumer organizations usually are created to advocate specific consumer interests. In some communities, they will help individual consumers with complaints. However, they have no enforcement authority. To find out if such a group is in your community, contact your state or local government consumer protection office. A list of the state and local offices begins on page 70.

Consumer Information Catalog

The Consumer Information Catalog lists approximately 200 free or low-cost Federal booklets with helpful information for consumers. Topics include careers and education, cars, child care, the environment, Federal benefits, financial planning, food and nutrition, health, housing, small business and more. This free Catalog is published quarterly by the Consumer Information Center of the U.S. General Services Administration. Single copies of the Catalog only may be ordered by sending your name and address to Catalog, Consumer Information Center, Pueblo, CO 81009 or by calling (719) 948-4000. Non-profit groups that can distribute 25 copies or more each quarter automatically can receive copies by writing for a bulk mail card.

Part I. Buying Smart

Protecting Yourself

Consumers are faced with a marketplace full of decisions. Ask the right questions before and after you buy and avoid consumer fraud and rip-offs.

Before you buy

o Take advantage of sales, but compare prices. Do not assume an item is a bargain just because it is advertised as one.

o Don’t rush into a large purchase because the 'price is only good today.'

o Check to see if the company is licensed or registered at the local or state level.

o Contact your consumer protection office or Better Business Bureau (BBB) for any complaint recorded against the company. Request any consumer information they might have on the type of purchase.

o Be aware of such extra charges as delivery fees, installation charges, service costs, and postage and handling fees. Add them into the total cost.

o Ask about the seller’s refund or exchange policy.

o Read the warranty. Note what is covered and what is not. Find out what you must do and what the manufacturer or seller must do if there is a problem.

o Don’t sign a contract without reading it. Don’t sign a contract if there are any blank spaces in it or if you don’t understand it. In some states, it is possible to sign away your home to someone else.

o Before buying a product or service, contact your consumer protection office to see if there are automatic cancellation periods for the purchase you are making. In some states, there are cancellation periods for dating clubs, health clubs, and timeshare and campground memberships. Federal law gives you cancellation rights for certain door-to-door sales.

o Walk out or hang up on high-pressure sales tactics. Don’t be forced or pressured into buying something.

o Only do business over the telephone with companies you know. o Be suspicious of P.O. Box addresses. They might be mail drops. If you have a complaint, you might have trouble locating the company.

o Do not respond to any prize or gift offer that requires you to pay even a small amount of money.

o Use unit pricing in supermarkets to compare what items cost. Unit pricing allows you to compare the price ounce-for-ounce, pound-for-pound, etc. As an example, bigger packages are not always cheaper than smaller ones.

o Use coupons carefully. Do not assume they are the best deal until you’ve compared them to the prices of competitive products.

o Make sure all documents you sign are in a language you understand.

o Don’t rely on a salesperson’s promises. Get everything in writing.

Remember:

1. First contact the seller if you have a complaint.

2. If that does not resolve your problem, contact the company headquarters.

3. If your problem is still unresolved, refer to the subject index for the organizations, or local, state and Federal offices that provide help in cases like yours.

4. Taking legal action should be the last resort. However, if you decide to exercise this right, be aware that you might have to act within a certain time period. Check with your lawyer about any statutes that apply to your case.

After you buy

o Read and follow product and service instructions.

o Be aware that how you use and take care of a product might affect your warranty rights.

o Keep all sales receipts, warranties, service contracts and instructions.

o If you have a problem, contact the company as soon as possible. Trying to fix the product yourself might cancel your right to service under the warranty.

o Keep a written record of your contact with the company. o If you have a problem, check with your consumer protection office to find out about the warranty rights in your state. o If you paid for your purchase with a credit card, you have important rights that might help you dispute charges. (See the 'Consumer Tips' section, page 20.)

o Check your contract for any statement about your cancellation rights. Contact your consumer protection office to see if a cancellation period applies.

o If you take the product in for repair, be sure the technician understands and writes down the problem you have described. Red Flags of Fraud

Consumer protection offices urge consumers to be aware of the red flags of fraud. Walk away from bogus offers. Toss out the mail or hang up when you hear:

o 'Sign now or the price will increase;'

o 'You have been specially selected...;'

o 'You have won...;'

o 'All we need is your credit card (or bank account) number -for identification only;'

o 'All you pay is for postage, handling, taxes...;'

o 'Make money in your spare time - guaranteed income...;' o 'We really need you to buy magazines (a water purifier, a vacation package, office products) from us because we can earn 15 extra credits...;'

o 'I just happen to have some leftover paving material from a job down the street...;'

o 'Be your own boss! Never work for anyone else again. Just send in $50 for your supplies and...;'

o 'A new car! A trip to Hawaii! $2,500 in cash! Yours, absolutely free! Take a look at our...;'

o 'Your special claim number entitles you to join our sweepstakes...;' or

o 'We just happen to be in your area and have toner for your copy machine at a reduced price.'

Remember, the smart consumer always looks at the total price before deciding and checks out the company and product before buying.

Stay away from telemarketers who want to:

o send a courier service for your money;

o have you send money by wire;

o automatically withdraw money from your checking account; o offer you a free prize, but charge handling and shipping fees;

o ask for your credit card number, checking or savings account number, social security number or other personal information; and

o get payment in advance especially for employment referrals, credit repair, or providing a loan or credit card.

Stay away from lotteries, pyramid schemes and multi-level sales schemes. They are all good ways to separate you from your money.

Complaining Effectively

Save all purchase-related paperwork in a file. Include copies of sales receipts, repair orders, warranties, canceled checks, contracts, and any letters to or from the company. When you have a problem:

o Contact the business that sold you the item or performed the service. Calmly and accurately describe the problem and what action you would like taken.

o Keep a record of your efforts to resolve the problem. When you write to the company, describe the problem, what you have done so far to try to resolve it and what solution you want. For example, do you want your money back, the product repaired or the product exchanged?

Allow time for the person you contacted to resolve your problem. Keep notes of the name of the person you spoke with, the date and what was done. Save copies of all letters to and from the company. Don’t give up if you are not satisfied.

o Contact the company headquarters if you have not resolved your problem at the local level. Many companies have a toll-free 800 number. Look for it on package labeling, in a directory of 800 telephone numbers (available at your local library), by calling 1 (800) 555-1212 (toll free) or by referring to the many corporate consumer contacts, beginning on page 29. Address your letter to the consumer office or the company’s president.

Writing a Complaint Letter

Where to send it

o Check the product label or warranty for the name and address of the manufacturer.

o If you need additional help locating company information, check the reference section of your local library for the following books: Standard & Poor’s Register of Corporations, Directors and Executives; Standard Directory of Advertisers; Trade Names Dictionary; and Dun & Bradstreet Directory.

o If you have the brand, but cannot find the name of the manufacturer, the Thomas Register of American Manufacturers lists the manufacturers of thousands of products. Check your local library.

o Each state has an agency (possibly the corporation commission or secretary of state’s office) that provides addresses for companies incorporated in that state.

o Remember, do business with a company you will be able to find later. It might be difficult to find companies in other states or those listing post office boxes as addresses. Even if you have an address, it might be only a mail drop, so be sure you know where the company you are doing business with is located physically.

What to say

o Include in the letter your name, address, home or work telephone numbers, and account number, if any.

o Make your letter brief and to the point. Include the date and place you made the purchase, who performed the service, such information about the product as the serial or model number or warranty terms, what went wrong, with whom you have tried to resolve the problem and what you want done to correct the problem.

o Use the sample consumer complaint letter on the following page as a guide.

o Include copies, not originals, of all documents.

o Be reasonable, not angry or threatening, in your letter. Type your letter, if possible, or make sure your handwriting is neat and easy to read.

o Keep a copy of all letters to and from the company.

o You might want to send your complaint letter with a return receipt requested. This will cost more, but will give you proof that the letter was received and tell you who signed for it. o If you feel you have given the company enough time to resolve the problem, send a copy of your letter to, or file a consumer complaint with, your local or state consumer protection agency, such specific state agencies as banking, insurance and utilities, or local Better Business Bureau. Their addresses can be found starting on pages 70, 87 and 63, respectively. Include information about what you have done so far to try to resolve your complaint. If you think a law has been broken, contact your local or state consumer protection agency right away.

Sample Complaint Letter

(Your Address) (Your City, State, ZIP Code) (Date)

(Name of Contact Person, if available) (Title, if available) (Company Name) (Consumer Complaint Division, if you have no contact person) (Street Address) (City, State, ZIP Code)

Dear (Contact Person):

Re: (account number, if applicable)

On (date), I (bought, leased, rented, or had repaired) a (name of the product with serial or model number or service performed) at (location, date and other important details of the transaction).

Unfortunately, your product (or service) has not performed well (or the service was inadequate) because (state the problem). I am disappointed because (explain the problem: for example, the product does not work properly, the service was not performed correctly, I was billed the wrong amount, something was not disclosed clearly or was misrepresented, etc.).

To resolve the problem, I would appreciate your (state the specific action you want - money back, charge card credit, repair, exchange, etc.). Enclosed are copies (do not send originals) of my records (include receipts, guarantees, warranties, canceled checks, contracts, model and serial numbers, and any other documents).

I look forward to your reply and a resolution to my problem, and will wait until (set a time limit) before seeking help from a consumer protection agency or the Better Business Bureau. Please contact me at the above address or by phone at (home and/or office numbers with area codes).

Sincerely, (your name)

Enclosure(s) cc: (reference to whom you are sending a copy of this letter, if anyone)

Consumer Tips

This section contains a number of suggestions to help you become a smarter consumer. It includes tips on how to buy a car, avoid fraud and protect your privacy.

Remember to check with your local consumer protection office and Better Business Bureau for other consumer information on a variety of topics. Their addresses and phone numbers are listed on pages 70 and 63, respectively.

Car Repair, Purchase, Renting and Other Concerns

Car Repair

o Choose a reliable repair shop recommended to you by family or friends or an independent consumer rating organization. Check out the repair shop’s complaint record with your state or local consumer protection office or Better Business Bureau.

o When you take the car to the shop, describe the symptoms. Don’t diagnose the problem.

o Get more than one estimate. Get them in writing.

o Make it clear that work cannot begin until you have authorized it. Don’t authorize work without a written estimate, or if the problem can’t be diagnosed on the spot, insist that the shop contact you for your authorization once the trouble has been found.

o Don’t sign a blank repair order. Make sure the repair order reflects what you want done before you sign it.

o Is the repair covered under warranty? Follow the warranty instructions.

o Ask the shop to keep the old parts for you.

o Get all warranties in writing.

o Some car manufacturers might be willing to repair certain problems without charge even though the warranty has expired. Contact the manufacturer’s zone representative or the dealer’s service department for assistance.

o Keep copies of all paperwork.

Some states, cities and counties have special laws that deal with auto repairs. For information on the laws in your state, contact your state or local consumer protection office.

Buying A Used Car

o Check newspaper ads and used car guides at a local library so you know what’s a fair price for the car you want. Remember, prices are negotiable. You also can look up repair recalls for car models you might be considering.

o Call the Auto Safety Hotline at 1 (800) 424-9393 to get recall information on a car. Authorized dealers of that make of vehicle must do recall work for free no matter how old the car is. o Shop during daylight hours so that you can thoroughly inspect the car and take a test drive. Don’t forget to check all the lights, air conditioner, heater and other parts of the electrical system.

o Do not agree to buy a car unless you’ve had it inspected by an independent mechanic of your choice.

o Ask questions about the previous ownership and mechanical history of the car. Contact the former owner to find out if the car was in an accident or had any other problems.

o Check with your local department of motor vehicles to find out what you need in order to register a car.

o Ask the previous owner or the manufacturer for a copy of the original manufacturer’s warranty. It still might be in effect and transferable to you.

o Don’t sign anything that you don’t understand. Read all documents carefully. Negotiate the changes you want and get them written into the contract.

o For information on recalls and safety issues, see page 10 under new car sales.

Buying from a Private Individual

Generally, private sellers have less responsibility than dealers for defects or other problems.

o Check with your state’s motor vehicle department on what you will need to register a vehicle.

o Make sure the seller isn’t a dealer posing as an individual. That might mean the dealer is trying to evade the law and might be an indicator of problems with the car. Look at the title and registration. Make sure the seller is the registered owner of the vehicle.

o Ask the seller lots of detailed questions about the car. o Have the car inspected by your mechanic before you agree to buy it.

Buying from a Dealer

Check the complaint records of car dealers with your state or local consumer protection agency or Better Business Bureau. o Read the 'Buyers Guide' sticker required to be displayed in the window of the car. It gives information on warranties, if any are offered, and provides other information.

o In most states, used cars may be sold 'as is.' If the 'as is' box is checked off on the 'Buyers Guide,' you have no warranty. o If the 'warranty' box is checked off on the 'Buyers Guide,' ask for a copy of the warranty and review it before you agree to buy the car.

o Have the car inspected by your mechanic before you agree to buy it.

o Some states have laws giving extra protection to used car buyers. Contact your state or local consumer protection office to find out what rights you might have.

o To order a free publication on buying a used car, contact the Federal Trade Commission, Public Reference Section, 6th and Pennsylvania Avenue, N.W., Room 130, Washington, DC 20580, (202) 326-2222.

Buying A New Car

o Evaluate your needs and financial situation. Read consumer magazines and test drive several models before you make a final choice.

o Find out the dealer’s invoice price for the car and options. This is what the manufacturer charged the dealer for the car. You can order this information for a small fee from consumer publications you can find at your local library.

o Find out if the manufacturer is offering rebates that will lower the cost.

o Get price quotes from several dealers. Find out if the amounts quoted are the prices before or after the rebates are deducted.

o Keep your trade-in negotiations separate from the main deal. o Compare financing from different sources, for example, banks, credit unions and other dealers before you sign the contract. o Read and understand every document you are asked to sign. Do not sign anything until you have made a final decision to buy. o Think twice about adding expensive extras, you probably don’t need, to your purchase, for example, credit insurance, service contracts or rustproofing.

o Inspect and test drive the vehicle you plan to buy, but do not take possession of the car until the whole deal,including financing, is finalized.

o Don’t buy on impulse or because the salesperson is pressuring you to make a decision.

o The National Highway Traffic Safety Administration’s Auto Safety Hotline at 1 (800) 424-9393 (toll free) distributes recall and safety information on used and new cars, trucks, motorcycles, motor homes, child seats and other motor vehicle equipment; vehicle crash test information; tire quality grading reports; child seat registration forms; and other safety literature. You should report all vehicle and child seat defect information to the Hotline (see page 108).

o The Center for Auto Safety (see page 56) monitors auto defects. To see if there is a pattern of repeated complaints on a certain vehicle model, write the Center for Auto Safety, 2001 S Street, N.W., Suite 410, Washington, DC 20009 and include the vehicle make, model and year, and a self-addressed stamped envelope.

Credit and Sublease Brokers

A new and rapidly growing area of consumer fraud involves con artists who prey on people who have bad credit and who are having problems getting loans to buy cars. There are two main schemes: o The 'credit broker' promises to get a loan for you in exchange for a high fee. In many cases, the 'broker' takes the fee and disappears, or simply refers you to high-interest loan companies.

o The 'sublease' broker charges a fee to arrange for you to 'sublease' or 'take over' someone else’s car lease or loan. Such deals usually violate the original loan or lease agreement. Your car can be repossessed even if you’ve made all of your payments. You also might have trouble insuring your car.

To protect yourself:

o check with your state or local consumer protection agency to find out if the broker is required to be licensed;

o do not do business with a company that does not appear to be complying with state law; and

o do not pay for services in advance.

To order a free publication on how to buy a new or used car, contact the Federal Trade Commission, Public Reference Section, 6th and Pennsylvania Avenue, N.W., Room 130, Washington, DC 20580, (202) 326-2222.

Car Leasing

o Shop around for the best leasing deal. Read lease promotions carefully. The attractive low monthly payment might be available only if you make a large down payment (capitalized cost reduction) or a balloon payment at the end of the lease.

o Beware of open-end leases. They require the consumer to pay the difference if the vehicle is worth less at the end of the lease than was estimated originally.

o The Consumer Leasing Act requires leasing companies to give you important information in writing before you sign a contract. Read the documents given to you by the leasing company and make sure you understand them before you sign anything. In particular, look for:

-up-front costs, for example, security deposits, down payments, advanced payments and taxes;

-the terms of the payment plan;

-termination costs, for example, excess mileage penalties, excessive wear and tear charges, and disposition charges; and - penalties for early termination or default.

When you have paid off a car loan, you own the car. When you have paid off the lease, you own nothing.

To order a free publication on car leasing, contact the Federal Trade Commission, Public Reference Section, 6th and Pennsylvania Avenue, N.W., Room 130, Washington, DC 20580, (202) 326-2222. Lemon Laws

Almost every state has a new car 'lemon law' that allows the owner a refund or replacement when a new vehicle has a substantial problem that is not fixed within a reasonable number of attempts. Many specify a refund or replacement when a substantial problem is not fixed in four repair attempts or the car has been out of service for 30 days within the first 12,000 miles/12 months. If you believe that your car is a lemon: o contact your state or local consumer protection office for information on the laws in your state and the steps you must take to resolve the situation;

o give the dealer a list of symptoms every time you bring it in for repairs; keep copies for your records;

o get copies of the repair orders showing the reported problems, the repairs performed and the dates that the car was in the shop; and

o contact the manufacturer, as well as the dealer, to report the problem. Some state laws require that you do so to give the manufacturer a chance to fix the problem. Your owner’s manual will list an address for the manufacturer.

If the problem isn’t resolved, you might have the option of participating in an arbitration program offered by the manufacturer or your state. Contact your state or local consumer protection office for information.

Lemon Law Summary is available upon request by sending a self- addressed, stamped (52 cents) envelope to the Center for Auto Safety, 2001 S Street, N.W., Suite 410, Washington, DC 20009. Vehicle Repossessions

When you borrow money to buy a car, you should know that:

o The lender can repossess if you miss a payment or for any default (a violation of the contract).

o The lender can repossess without advance notice.

o After repossession, the lender might be able to accelerate, meaning the lender can require the borrower to pay off the entire balance of the loan in order for the borrower to get the vehicle back.

o The lender can sell the vehicle at auction.

o The lender might be able to sue the borrower for the deficiency if it sells the car for less than the borrower owes. This is true even in voluntary repossessions.

o The lender cannot commit a 'breach of the peace,' for example, breaking into a home or physically threatening someone, in the course of a repossession.

If you know you’re going to be late with a payment, talk to the lender to try to work things out. If the lender agrees to a delay or to modify the contract, be sure you get the agreement in writing.

Some states have laws which give consumers additional rights. Contact your state or local consumer protection office for more information.

To order a free publication on vehicle repossessions, contact the Federal Trade Commission, Public Reference Section, 6th and Pennsylvania Avenue, N.W., Room 130, Washington, DC 20580, (202) 326-2222.

Renting A Car

Federal law does not cover short-term car and truck rentals. However, there are state laws that do. You should contact your state or local consumer protection office for more information on laws in your area.

o Shop around for the best rates.

o Compare all fees, in addition to the daily/weekly rate, before renting.

o Most car rental contracts make the consumer liable for all damage to the vehicle, no matter who caused it. Before buying a rental company’s collision or loss damage waiver, check with your own car insurance company and your credit card company to see if they cover car rentals and to what extent. It pays to do your homework because these policies can add $3 to $15 per day to your rental charges! Rental companies also might sell loss of use and liability insurance. Check with your insurance agent in advance, so you do not duplicate coverage you already have.

o If you pay by credit card, some rental companies will place a hold or freeze on your account during the rental period. Others might start to charge your account before the rental period is over. Find out the company’s policy in advance.

o Carefully inspect the vehicle and its tires before renting and write down all the dents and scratches you see.

o Check refueling policies. You can refill at a local gas station, you can let the car rental company refuel the car at its price, which is usually higher, or you can pay in advance for a refill which will cost you needlessly if there is any unused gas upon returning the vehicle.

o Contact your state or local consumer protection agency for information on state law or to report problems with your car rental.

o To order a free publication on car rental, contact the Federal Trade Commission, Public Reference Section, 6th and Pennsylvania Avenue, N.W., Room 130, Washington, DC 20580, (202) 326-2222. Mail Order

Federal mail order rules require companies that take consumers’ orders by mail to:

o ship the merchandise within 30 days of receiving a completed order or within a different timeframe if it is stated in their ads;

o notify consumers if shipment can’t be made on time and give them the choice of waiting longer or receiving refunds; and o cancel their orders and return their money (or give them credits on their charge accounts) if the revised shipping date can’t be met, unless the consumers agree to another delay. There also might be laws regarding mail order in your state. Contact your state or local consumer protection agency.

o Keep a record of the name, address and phone number of the company, goods you ordered, date of your order, amount you paid and method of payment.

o Keep a record of any delivery period that was promised. o If you are told that the shipment will be delayed, write the date of that notice in your records and the new shipping date if you’ve agreed to wait longer.

o When you cancel an order that wasn’t shipped on time, you have the right to get a refund within seven days or within one billing cycle for charged sales.

o When you use your credit card for mail order purchases and you don’t receive the goods or services, or they were defective or misrepresented, use the credit card protection rights described in the section on Credit Cards, page 18.

o To limit some of the mail you do not want, you can sign up with the free Mail Preference Service operated by the Direct Marketing Association, a private trade group. It will instruct its mail marketing members to take you off their lists. To join, write to the Mail Preference Service, P.O. Box 9008, Farmingdale, New York 11735.

To report violations of the Federal mail order rule, contact the Federal Trade Commission. For information on your state laws, contact your state or local consumer protection agency. To report a problem with mail order, contact the U.S. Postal Inspection Service or the Postal Crime Hotline at 1 (800) 654-8896.

Mail Fraud

o Read the offer carefully. Get the advice of another person whose opinion you trust.

o Deal only with companies or charities whose reputation and integrity are known.

o Never give your credit card number or personal, financial or employment information unless you know with whom you are dealing.

o Never send money for any 'free' merchandise or services. o Be careful of making impulse purchases.

o Keep a record of the order, notes of the conversation and copies of the advertisement, canceled check, receipt, letters and envelopes.

o Take the time to shop locally and compare products, services and prices to those in local stores.

o Check out the company with the U.S. Postal Inspection Service, your state or local consumer protection agency, or the Better Business Bureau. Mail fraud is a federal crime.

o Using your credit card or a money order might give you some recourse if you have a problem, despite your carefulness.

Be suspicious of 'free gifts' that require a 'tax payment' or 'registration fee;' sweepstakes requiring an entry fee or purchase; employment or work-at-home opportunities requiring a fee; offers requiring your credit card number or bank account number; loans that require you to pay a fee in advance; mailings that look like they are from official government agencies, when they are not; and prize notices requiring you to call a 900 number.

Telemarketing

While many legitimate businesses use the telephone to make their sales, it’s easy for fraudulent companies to abuse the phone. Beware of the con artists who promise anything and deliver nothing, or at least not what customers thought they were getting.

Tips for Smart Telephone Shopping

o Always keep a record of the name, address and phone number of the company, goods you ordered, date of your purchase, amount you paid (including shipping and handling) and method of payment. o Keep a record of any delivery period that was promised. o If you are told that the shipment will be delayed, write the date of that notice in your records and the new shipping date, if you’ve agreed to wait longer.

o Don’t give your credit card number, checking account number or other personal information to a telemarketer unless you are familiar with the company or organization, and the information is necessary in order to make your purchase.

Telephone Order Rights

o Some states have telemarketing laws that require written contracts, automatic cancellation periods or registration of telemarketing companies. Contact your state or local consumer protection agency. Federal telephone order rules require companies that take consumers’ orders by phone, computer or fax to:

o ship the merchandise within 30 days of receiving a completed order or within a different timeframe if it is stated in their ads;

o notify consumers if shipment can’t be made on time and give them the choice of waiting longer or receiving refunds; and o cancel their orders and return their money (or give them credits on their charge accounts) if the revised shipping date can’t be met, unless the consumers agree to another delay. Use Caution and Common Sense

o Don’t be pressured into acting immediately or without the full information you need.

o Shop around and compare costs and services.

o Report all fraudulent activity to your consumer agency. Check the company out with your consumer protection agency or the Better Business Bureau.

o If the solicitation came by mail, call the Postal Crime Hotline at 1 (800) 654-8896 (toll free) for more advice on not becoming a victim.

o Call the National Fraud Information Center, administered by the National Consumers League, at 1 (800) 876-7060 (toll free) for information about telemarketing fraud.

Blocking Telemarketing Calls

You have the right under federal law:

o to tell a company not to call you by phone or not to contact you in writing; the company must keep a list of these consumers and not contact them; keep a record for your file;

o not to get calls before 8 a.m. or after 9 p.m.;

o not to receive unsolicited ads by fax; and

o to be disconnected from a pre-recorded machine-delivered message within five seconds of hanging up.

Some states do not allow telemarketers to call people who do not want to receive calls. Contact your state or local consumer protection agency to check your state’s rights.

To reduce telephone calls you do not want, you can sign up with the free Telephone Preference Service operated by the Direct Marketing Association, a private trade group. To join, write to the Telephone Preference Service, P.O. Box 9014, Farmingdale, NY 11735.

To report violations of the telephone order rule, contact the Federal Trade Commission. If you made the telephone transaction in response to a postcard or other mailing, contact the U.S. Postal Inspection Service or the Postal Crime Hotline at 1 (800) 654-8896 (toll free). For information on the laws in your state, contact your state or local consumer protection agency.

Calls That Cost: 900 Numbers and Other Pay-Per-Call Services Unlike 800 numbers which are free, you pay a fee when you call a 900-type number. The company or organization you’re calling sets the price, not the telephone company. Most states do not regulate the cost of these calls. Charges can vary from less than a dollar to more than $50. Federal law requires that: o consumers be told the cost of calling the number and given a description of the product and service. This must appear in advertisements and, for calls costing more than two dollars, in the introductory message or preamble at the beginning of the call;

o the cost of calling must be disclosed by flat rate, by the minute with any minimum or maximum charge that can be determined, or by range of rates for calls with different options; all other fees charged for services and the cost of any other service to which a caller might be transferred must be disclosed;

o consumers must be given time to hang up after the introductory message without being charged; there must be a signal or tone to let them know when the preamble ends;

o no charges can be made for calling 800 numbers unless the consumer agrees in advance to be charged;

o any pay-per-call services offering sweepstakes, prizes or awards must disclose the odds of winning or the factors for determining the odds;

o ads directed to children under age 12 are not allowed unless they are for legitimate educational services;

o ads directed primarily to people under the age of 18 must state that parents’ consent is needed to call the number; and o ads for information about Federal programs offered by private companies must state clearly that they are not endorsed, approved or authorized by government agencies.

Protect yourself from fraud by avoiding:

o ads that don’t describe clearly the goods or services or the cost of the calls;

o offers of 'free' gifts or prizes just for calling;

o promises of jobs, loans, credit cards for people with poor credit, 'credit repair' or other services aimed at consumers who are in financial hardship;

o contests to win money in which little or no skill is required;

o services targeted to children under 12 which don’t appear to serve any legitimate educational purpose; and

o offers of cheap travel or any other deals that seem to be 'too good to be true.'

Hang up if you’re being switched from an 800 number to a 900 number without your prior consent.

What You Need to Know about 800 Numbers

Generally, you cannot be charged for 800 numbers. However, there are two exceptions. Charges for an 800 number can be made only if:

o you have a 'pre-subscription arrangement' with the company (for example, with an information service). This means you already have an agreement to accept charges before you called the 800 number; or

o you agree to a credit card charge.

Your Rights and Recourse

o If you question 900-type number charges which appear on your phone bill, you can dispute the bill. Your local and long distance telephone service cannot be disconnected for disputed pay- per-call charges.

o In most cases, the charge for a pay-per-call service is collected by the local telephone company on behalf of the service provider. Follow the instructions on your bill immediately to dispute the charges. Keep a record of whom you talked to, and the date and copies of any letters you send. Pay the undisputed portion of your phone bill.

o Even if the telephone company removes the charges, the debt might be turned over to a collection agency by the service provider. Send the collection agency a letter explaining why you dispute the debt. (See the section on Credit, page 19.)

o To avoid problems with 900-type numbers, you can request 'blocking' from your local phone company. Blocking prevents 900 numbers from being dialed from your phone.

o If you suspect a violation of pay-per-call rules, contact your state or local consumer protection agency and the Federal Trade Commission. If the ad for the number came by mail, write to the U.S. Postal Inspection Service or call the Postal Crime Hotline at 1 (800) 654-8896 (toll free). If you are not satisfied with the way the phone company handled your complaint, contact the Federal Communications Commission. (See page 105 for information on how to contact Federal government agencies.)

Door-to-Door Sales

o Ask to see the salesperson’s personal identification and license or registration if that is required where you live. Make note of his/her name, the name and address of the company, and whether the salesperson carries proper identification.

o Ask for sales literature and then call local stores that might sell the same merchandise to compare prices. Some door-to-door products might be overpriced.

o Don’t be pressured into buying something. Watch for the warning signs: an offer of a 'free gift' if you buy a product, an offer that is only good for that day, or you’re told that a neighbor just made a purchase.

o If you feel threatened or intimidated, ask the person to leave. Don’t leave the person unattended in any room of your home. If you are suspicious, report the incident to the police immediately.

Cancellation Rights

o The 'Door-to-Door Sales Rule' (or 'Cooling Off Rule') gives you the right to cancel certain purchases costing $25 or more. Notify the company in writing by midnight of the third business day following the sale. Saturdays are considered business days, but Sundays and holidays are not.

o The seller must tell you about your cancellation rights and give you two dated copies of a cancellation form showing the seller’s name and address and explaining your right to cancel. o These Federal cancellation rights apply to purchases made in locations outside the seller’s normal place of business, in other words, at a house party, a temporarily rented room or in your home.

o States might have additional cancellation laws that protect consumers. Check with your state or local consumer protection agency for your rights.

o To cancel a contract, sign and date one copy of the cancellation form. Mail it within the three-day limit, making sure it’s post-marked before midnight of the third business day. Sending it by certified mail will show proof that it was mailed. o If you were not given the cancellation form at the time of sale, your right to cancel continues until three days after the seller finally gives it to you. You can write your own letter cancelling the sale and send it return receipt requested.

o Once you cancel, you have a right to a refund within 10 days. The seller must let you know when the product will be picked up and must return any paperwork and trade-ins within that time. o Within 20 days, the seller must pick up the item or reimburse you for any shipping expenses if you send it back yourself. If you do not return it, you still are responsible under the contract.

o Extend your rights! If you paid by credit card, canceled the contract within three days, have not yet paid the credit card bill and still have a problem getting a refund, dispute the charges with your credit card company under the Fair Credit Billing Act, (See the section on Credit, page 19.)

Home Improvement

o Plan ahead. Know what you want or need to have done before contacting a contractor.

o Get detailed estimates from reputable contractors. Contact your local or state consumer agency and Better Business Bureau for information on contractors’ licensing or registration requirements, complaint records and for brochures containing advice.

o Contact your local building inspection department to check for permit and inspection requirements.

o Call your insurance company to find out if you are covered for any injury or damage that might occur and be sure your contractor has the required insurance for his/her workers and subcontractors.

o Insist on a complete written contract. Know exactly what work will be done, the quality of materials that will be used, timetables, the names of any subcontractors, the total price of the job and the schedule of payments.

o You have cancellation rights (usually three business days) in many home improvement contracts. Before you sign a contract, check with your local consumer agency to find out if you have cancellation rights and how they apply.

o Understand your payment options. You can get your own loan or the contractor might arrange financing. Be sure you have a reasonable payment schedule at a fair interest rate.

o Some state laws specify payment schedules, for example, only allowing a certain percentage of the total cost to be made as a down payment. Contact your state or local consumer agency to find out what the law is in your area.

o Lien rights, which might give the contractor or subcontractors the ability to 'attach' your home for unpaid bills, vary from state to state. Ask your local consumer agency to explain the situation where you live.

o You need to be especially cautious if the contractor:

- comes door-to-door or seeks you out;

- just happens to have material left over from a recent job; - tells you your job will be a 'demonstration;'

- offers you discounts for finding him/her other customers; - quotes a price that’s too cheap;

- pressures you for an immediate decision;

- has workers or suppliers who tell you they have trouble getting paid;

- can be reached only by leaving messages with an answering service; or

- drives an unmarked van or has out-of-state plates on his/her vehicle.

Home Financing

o Check the real estate or business sections in the newspaper for information on current interest rates. Call several lenders for rates and terms based on the type of mortgage you want. o When buying a newly constructed home, compare the interest rate and terms offered through the builder’s sales office with those offered by other lending institutions.

o When interest rates go down, you might save money by refinancing, but you probably should not refinance unless the new interest rate will be at least two percentage points below the rate you’re paying currently.

o For an adjustable rate mortgage, or 'ARM,' find out the 'cap' or the maximum interest rate that can be charged during the life of the loan. Ask how often the rate might change and what determines the rate change.

o Get a complete list of 'closing' or 'settlement' costs and find out which costs will be refunded if your loan is not approved.

o Be wary of financing that is based on 'negative amortization.' While the payments might be lower than in other types of loan agreements, they’re not enough to cover the monthly interest charges. The portion of interest that is left unpaid is added to the principal, which means that each month, the borrower pays interest on a higher amount than before. With negative amortization, the debt actually keeps increasing rather than decreasing. You could end up owing a lot of money at the end of the loan or losing your home.

Home Equity Credit Lines

o Although a home equity credit line might allow you to take tax deductions you could not take with other types of loans, your home will be at risk if you cannot make the monthly payments. o Some questions to ask when comparing home equity loan offers: - How large a credit line can be extended?

- How long is the term of the loan?

- What is the minimum monthly payment? Is there a maximum? -What is the annual percentage rate?

- If the interest rate 'floats,' or is adjustable, how muc