Averaging over 260 days of sunshine in a year, San Diego is one of the best places in America to ride. For most, buying a motorcycle will mean some type of motorcycle financing, which most dealership offer to potential buyers. And while a motorcycle financing offer may seem like a dream come true, there are several new tactics that motorcycle dealers and finance companies could try in an attempt to prioritize profits over the rights of riders. As such, it is important to be aware of your rights and know what to expect.
There are a number of common predatory lending tactics. For example, dealerships and finance companies may offer a teaser rate at the beginning of the loan period – only to have the payments shoot up after the initial period. Or the “loan” may, in fact, be not a conventional loan, but a new credit card, with finance charges that are not fully disclosed up front, and which may result in significant interest charges down the line. For many, this can result in far more in interest than initially anticipated. In some cases, this may mean that a rider can no longer afford to own the very bike that such financing was supposed to make affordable.
California’s Rees-Levering Act
California has enacted a law that protects consumers from such predatory lending tactics. For example, the Rees-Levering Act requires that a dealer disclose all fees and costs in one document to the buyer. This prevents multiple documents that may conflict with one another and become confusing to the buyer. In addition, if there are any changes to the monthly payments, this must be included in the document so that the consumer is not later surprised by the increased monthly payments. If your motorcycle is being financed by opening a new credit card, this must be disclosed to you and your approval must be given. The failure of the financing company to follow these practices may result in a violation of law.
As part of our responsibility to the motorcycle rider community, we are always investigating claims of abusive lending practices. If you or someone you love has been a victim of predatory lending, please contact our office today.
*DISCLAIMER: The information contained in this post and on this website may contain LEGAL ADVERTISEMENT. It does not constitute and should not be construed as a legal advice or medical advice. Similar results are not guaranteed. Past results are no guarantee of future results. The information in this article is provided for general informational purposes only. The law changes frequently and varies from jurisdiction to jurisdiction. Being general in nature, this information may not apply to any specific factual and/or legal set of circumstances. No attorney-client relationship is formed, nor should any such relationship be implied. Nothing on this blog is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction. If you require legal advice, please consult with a competent attorney licensed to practice in your jurisdiction.