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HSFPP Weekly Update # 140—Used Cars from Hurricane states

Message from Bob & Chris: Cars that have been damaged by the recent hurricanes will be appearing on used car lots and individuals will be advertising them in newspapers and other media. Intelligent consumers should do all they can to avoid buying a car that has been flooded or designated by an insurance company as a total wreck, retitled as salvage in one state and then illegally retitled in another state with the salvage designation removed. Unfortunately, this happens more often than we would like and car buyers need to use all the available resources to avoid buying a disguised wreck. Resources worth using include http://carfax.com/ and the Web site mentioned in this week’s article In the New$....

This week, we highlight two Web Site Picks of the Week.

 

Related Updates:

Update #128 - Used Car Buying III - 9 May 2005
Update #95 - Another Danger for Used-Car Buyers - 18 May 2004
Update #94 - Size and Weight in Cars - 10 May 2004
Update #90 - Buying a Used Vehicle - 8 April 2004
Update #34 - Buying a Used Vehicle - 21 October 2002
Update #24 - Car Buying - 28 May 2002

 

Website Pick of the Week:

Experian Automotive, a division of global business solutions company Experian®, now offers consumers free information on storm damage to vehicles through their AutoCheck Storm Damage Scan, available at this Web site:

http://www.autocheck.com/storm

The Kentucky Attorney General’s car buying Web sites are also well worth visiting before buying a used or new car in Kentucky.

http://ag.ky.gov/cp/auto.htm
http://ag.ky.gov/cp/usedcar.htm
http://ag.ky.gov/cp/auto.htm#usedcars

 

Activity for Educators:

Have students read this week’s article In the New$... and use the discussion questions in a class discussion about the hazards of car buying. You might want to tell the class about some of your own experiences with buying a new or used car. Teens who are buying cars for the first time need to be prepared for dealers who use a variety to tactics to make the car more expensive; and the dealer could be peddling a lemon or a wreck.

If any of your students have already bought a car, especially a used car, perhaps they could share their experiences with the class. Are they satisfied with their cars? Did they get a good deal? How were they treated by the dealer? Also, did they check with Carfax to make sure they knew the car’s true past history? It is especially easy for teens to relate to the used-car buying experience if they hear about it from peers who have dealt with it themselves.

 

In the New$... Experian Offers Consumers Free Online Service to Identify Storm Damaged Vehicles

For consumers who are concerned about buying a wreck from hurricane-affected states, Experian’s new service will provide information on vehicles titled and registered within those states and reported as damaged or totaled, according to a press release dated October 25, 2005.

“‘Our data tells us that storm-related damage to vehicles isn't limited to just flooding. We have found that states brand up to ten times as many cars “salvage” as they do “water damage” after a hurricane,’ said Scott Waldron, president of Experian Automotive. ‘Potential used car buyers need to safeguard themselves from purchasing storm damaged vehicles from unscrupulous sellers and should be sure that their check includes salvage vehicles.’

“In addition to this precaution, Experian Automotive recommends a thorough vehicle inspection. The National Automobile Dealers Association (NADA) and Experian Automotive offer consumers ten inspection tips to help detect significant water damage:

-- “Check the vehicle's title history, it may state whether it has sustained flood damage;
-- “Examine the interior and the engine compartment for evidence of water and grit from suspected submersion;
-- “Check for recently shampooed carpet;
-- “Check under the floorboard carpet for water residue or stain marks from evaporated water not related to air-conditioning pan leaks;
-- “Look for rust on the inside of the car and under interior carpeting and visually inspect all interior upholstery and door panels for any evidence of fading;
-- “Check under the dashboard for dried mud and residue, and note any evidence of mold or a musty odor in the upholstery, carpet or trunk;
-- “Check for rust on screws in the console or other areas where the water would normally not reach unless submerged;
-- “Check for mud or grit in alternator crevices, behind wiring harnesses and around the small recesses of starter motors, power steering pumps and relays;
-- “Complete a detailed inspection of the electrical wiring system, looking for rusted components, water residue or suspicious corrosion;
-- “Inspect the undercarriage of other components for evidence of rust and flaking metal that would not normally be associated with late model vehicles.

“While it's too early to know exact numbers, some experts estimate more than 500,000 cars were significantly damaged by Hurricanes Katrina and Rita. Consumers can access the AutoCheck Storm Scan feature by visiting http://www.autocheck.com/storm.”

Source: Adapted and excerpted from “Experian Offers Consumers Free Online Service to Identify Storm Damaged Vehicles” [Press Release]. Experian Automotive, 10/25/05. Found on Yahoo.com PR Newswire: http://biz.yahoo.com/prnews/051025/cgtu021.html?.v=27

 

Activity for Students:

Discussion Questions

1.) What research should you do to avoid buying a used car that has been wrecked or flood damaged?

 

2.) What other ways can dishonest car dealers use to try to pass a “lemon” or a “wreck” on to an unwary consumer?

 

3.) Why is a good idea to test drive a vehicle and then come back another day to haggle about the price?

 

Kentucky High School Financial Planning Program

http://www.ca.uky.edu/fcs/hsfp

The purpose of this Web site is to assist county extension agents, credit union educators, and high school teachers in improving the economic well-being of our constituency, beginning with today’s students; and also, to assist teachers in Kentucky in meeting KERA’s goal that all students become technologically literate. Weekly Updates are provided by the University of Kentucky Cooperative Extension Service, and are free to all educators.