Sale and financing of used automobiles by second-hand automobile dealers.

A Local Law to amend the administrative code of the city of New York, in relation to the sale and financing of used automobiles by second-hand automobile dealers

This bill strengthens consumer protections against predatory lending practices that exist in the used car industry. It will mandate that used car dealers disclose certain information to consumers, including: i) the itemized prices of add-on products; ii) the total cost of the vehicle, broken down by monthly payments and with or without any add-ons; iii) the lowest interest rate (APR) offered to the consumer by a finance company; and iv) any other financing-related disclosures the Commissioner prescribes by rule. Any required documents or disclosures to be provided to a consumer must be in the language used to negotiate the contract for sale. In addition, this bill requires dealers to offer an “automobile contract cancellation option” that would allow a buyer to cancel a contract for sale, subject to some limitations, within two days of purchasing the used vehicle. During the cancellation period, the purchased used car remains on the dealer’s lot until the consumer makes a decision. A dealer is required to retain certain records related to the sale of used cars for six years, which may be subject to audit by the department of consumer affairs. The bill also gives the Commissioner of the Department of Consumer Affairs the discretion to report to the City Council and the Mayor on the effectiveness of the bill. Finally, this bill creates additional civil penalties for the violation of its provisions.