07/26/2007
Here's the catch: Auto lease companies
offer to sublease vehicles for consumers who want to free themselves from lease
payments, at least for a while, and who can get along without their car, at
least for a while. But sooner or later the companies renege on the promises in
both their advertising and their contract, the consumers can lose more than
money, and often they still have to get along without their car--sometimes
forever. At some point, they begin to feel like they've been run over with their
own car.
Two local auto subleasing companies, Auto Lease Traders (ALT),
also referred to by some complainants as Auto Lease Trackers, of Santa Ana, and
National Auto Specialist (NAS), of Corona, have become sources of consumer
complaints within the last six months. Though the complaint numbers are not high
at this point (11 for ALT; four for NAS), the companies' actions have caused
their Better Business Bureau rating to plummet to an "F."
One ALT
complainant advertised his father's car for sale through various websites. When
ALT contacted him and offered to sublease the car for him, he accepted because
his father owed more on the car than it was worth.
ALT, though, was consistently late in making the payments. And not until
nearly two weeks after it happened did he learn that the car had been impounded;
soon after, the finance company repossessed it.
Another ALT customer
subleased her Mercedes because she no longer needed the car but had three years
left on the lease. She says ALT guaranteed payment of the lease, registration
and insurance. They also promised to inspect the vehicle and make certain it was
kept in good condition, had not been driven more than the allotted mileage, and
didn't show excessive tire wear. Before she agreed, she met with the owner and
checked his references.
ALT made the lease payments and kept the insurance in force, at least at
first, but disregarded everything else they had promised. The car was impounded
because the registration had not been paid, and although ALT agreed to work with
this client, she was never able to contact them.
This complainant had to make two payments that ALT failed to make and also
pay for repair of damage to the bumper and hood of the car, towing, and
replacement of two $212 keys. She also incurred costs for airfare, car rental
and three days' time lost from work to resolve the matter. She estimates her
total loss at more than $5,000, not including the time off work.
Still
another client learned, from calls she received from the finance company, that
ALT had missed payments on her Chrysler. She's filed a police report but has no
idea where her car is and cannot contact ALT.
NAS, also, according to a northern California complainant, guaranteed timely
lease payments, regardless of whether the end user paid on time, and promised
that they would insure the car and inspect it periodically. This complainant,
though, ended up with costs of $3,935 in unpaid lease payments, $1,500 to repair
accident damage to her car, an excess of 20,000 miles on her odometer in six
months, and damage to her credit rating. NAS did not respond to her calls and
email messages.
Another complainant contracted with NAS to lease out his $70,000 motor home.
This client complains that although the vehicle was registered in Texas, NAS
promised to get it smogged and registered in California and to recover it for
him should the end user not fulfill his contract. He says that he's had to make
some of the payments that neither the sublessee nor NAS made and that because
NAS did not register the vehicle, it's now six months out of
registration.
One of NAS's four complainants is a consumer who contracted
with NAS to sublease a Lexus from them. This complainant made a $5,000 deposit,
but thirty days later, still had no car and no refund of her deposit.
Neither company has responded to the complaints we've presented to it.
Kim's advice: Don't get caught.
- First, before you even consider subleasing your leased vehicle, check your
contract to make sure it isn't prohibited. You may be subject to fines or
penalties if you sublease contrary to the terms of the contract.
- Inform your lessor of your intention to sublease your vehicle. Be aware that
you may be held responsible for charges for damage caused by the sublessee,
excess mileage, etc.
- Remember that if the company you're dealing with is not reputable, you can
lose much more than what you had expected to save. Retrieving your vehicle and
forcing the company to compensate you for the damages you incur can be extremely
difficult. You may not even be able to contact the company, since not responding
to consumer calls and messages is typical of companies who do not perform
according to their contract.
- Get a Better Business Bureau reliability report before you do business. If
the company's rating is not to your satisfaction (both these companies now have
"F" ratings), it's unlikely you will choose to do business with them. Just the
same, a company with no complaints and no adverse business practices or other
apparent problems can have a satisfactory letter rating because this reflects
our experience with the company at the time. Since company names and ownership
can change, and often less-than-reputable companies go out of business only to
resurface with a new name and a clean slate, factors such as length of time in
business are also important. Be sure to consider the entire report in your
decision to do or not to do business with a company.
Kim Burge is the
Better Business Bureau's Director of Trade
Practices
