Alert: American Car Center Titles Being Claimed By Consumers

Nightmare Waiting to Happen
Big Time article today in Fortune Magazine, one of the largest financial publications, about a subprime auto lender going out of business. Right and we get hundreds of calls every day from people who bought a car from a dealer and they went out of business before they got their title after they paid it off.

Buy Here Pay Here Dealership Issues
Meaning that they did a buy here pay here with this dealer so they paid payments directly to the dealer one year, two years, whatever it is. At the end of that period of time, the dealer had gone out of business, and they never got their title because you don’t get your title until you make your last payment. So if that dealer goes out of business within that period of time, you’re out of luck, and it’s a very serious problem to get a title.

Methods to Get Your Title
You can see the link below of some methods to get your title if you’ve been a victim of a dealer going out of business. But what does it mean for this particular dealer, and how big of a problem is it?

American Car Center Closure
Well, this dealer is called American Car Center, and they closed their doors. They had a $222 million Bond sale that they just pulled. They were trying to get some money. They have 288 people that work for them at their headquarters. They have 40 dealerships across 10 states.

Impact on Car Buyers
So what does that mean? Well, if each dealership, let’s say, sells, I don’t know, what is the dealership going to sell? 30, 40 cars a month maybe, probably more, but let’s say 40 cars a month. That means every month they’re putting like 1,600 cars in the street over all their dealerships. There’s probably more than that, right, but let’s just call it 1,600 cars. Every year, right, that’s like 20,000 cars that they’re putting in the street without giving titles because they hold the title until it’s paid off.

Magnitude of the Problem
So even if their loans are only for a year long, that’s 20,000 people who are at risk of not getting a title. 20,000 people. And if their loans are two years or if they sell 50 cars a month, you could be talking 30, 40, 50,000. There’s a possibility there could be a hundred thousand cars out there with title problems.

Consequences for Customers
So what happens? So you buy a car from this dealer, you pay payments for six or eight months, and then they go out of business. And now, how do you get your title, right? Presumably, there may be a company that comes in and buys up their assets or takes over their operations or whatever it is, or they go bankrupt. But in the meantime, your title is now at risk, right?

Legal Advice and Actions
So what you want to do is if you are a customer of this dealer or any dealer, for that matter, that goes out of business while you’re making payments to them, right away you want to get good legal advice. This may be something you contact an attorney about. At least make a filing with the licensing board.

Filing for a Title
How do you go about getting a title? Well, what you need to do is you need to file for a court order title or a magistrate title, sometimes called a civil lien, right? And it may eliminate you having to make the rest of your payments too. But what you want to do is start that process early because in some cases, the titling division of your state has a victim’s restitution fund that this dealer’s been paying into for years. Once that fund is exhausted, maybe it’s not going to be as easy to get a title. You want to be at the front of the line.

Immediate Steps for Affected Customers
So if you are a customer of this dealership or any dealership that has gone out of business, the first thing you do is you file for a magistrate title or a civil lien title or a court order title. Every state and even counties call it different things.

Title Problems and Lien Releases
But this is huge news. This could mean tens of thousands of vehicles out there with title problems, with lien release problems, because there’s really nobody around anymore that can issue these titles and sign off on lien releases because they’re going out of business.

Immediate Employee Termination
You know, they said right here, they laid off 288 people. All employees will be terminated by the end of the business day. So it’s not like they’re going to be around to finish up on paperwork or to get people their titles. All employees are gone that same day. It was very sudden.

Urgency for Customers
So it’s not like they’re going to have a staff that says, “Hey, let’s wind it up, let’s get these people their titles.” They’re done. Office is closed. That’s going to be a problem. So anybody who has this type of scenario, you want to start right away with getting the process going to make sure that you don’t lose out on your vehicle and all that money you spent on payments is down the drain.

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