About The Consumer Law Office of Steve Hofer

Steve Hofer has been practicing consumer law in Indiana for more than 20 years. He is the Indiana State Chairperson of the National Association of Consumer Advocates, a national organization of attorneys striving for fairness in the consumer marketplace.

Thursday, September 22, 2016

Is The Car Center Out of Business?

The Car Center, :3520 South Post Road, Indianapolis, IN 46239, is a  typical buy-here, pay-hear car lot - or maybe it was.  

I just received a tip that The Car Center has abruptly closed. I tried calling the phone number I had for them, and the phone wasn't answered.

I have received several complaints about this lot. None resulted in a case that I took action on.  Whenever a buy-here-payhere car lot closes, inevitably there are questions from the buyers:

Help, the car dealer I bought my car from has closed, what do I do?  Who do I pay?  What if I have a problem with my car?  How can I get my title?  If you have a car from this lot, you probably have to pay somebody, but it isn't clear who you have to pay.  Believe it or not, it isn't necessarily the person who calls you and says they hold the lien, but it MIGHT be.  The issue is complicated, but if a company provided floorplan financing to the dealership, that company doesn't necessarily have the right to repo yoru car.  You have superior rights to the floorplan finance company at least to the extent of your downpayment.  If the dealer held the contract in its own name without asignment to another finance company, your creditor will be the dealer's bankruptcy trustee if the dealer is bankrupt, and if the dealer is not bankrupt, it will still be the dealer.  

You might have claims or defenses to be raised.  Before you turn the car into anyone, ask that company for written proof that they are the owner of your car loan.  If anyone comes to repossess the vehicle, tell them to leave or you will call the police for a "breach of the peace." If your car is repo'd call me at 317-662-4529.  If you are threatened with reop, call me as well.  

If you get a call from anyone who wants you to give up your car - record the call.  This may be key to proving a law violation later.  Ask for any demand to be repeated in writing.

If you have an expired dealer plate.  Don't panic, and don't necessarily turn the car over to someone.  I will update this as I find out more information.  There are ways to get a title, but they aren't quick, and they aren't free. The cost of getting your title can likely be offset against payments that would otherwise be owed to any bona-fide lienholder. 

 If the dealership is in business, please let me know and I will correct this.  I posted this as a public service.  based ont he report and the attempt at confirmation.  If it is inaccurate, i will remove it upon notification.  

Wells Fargo not only Fired 5,200 Employees for Opening Fake Accounts, they fired whistleblowers as well.

This week Senator Elizabeth Warren rightfully grilled CEO of Wells Fargo, John Stumpf.  She exposed that Stumpf personally made $200 million in stock appreciation based in no small part on Wells Fargo's countinuingly touting its push to 8 accounts per customer because "eight rhymes with great".  Stumpf could not answer if Wells had any research showing its customers needed 8 accounts, which of course, they don't.

The pressure to cross-sell was so high that over 5,200 employees were fired for  opening fraudulent accounts.  You would think after they have to fire 4,000 employees that the company might have seen a problem.  Of course, they saw the problem.  Carrie Tolstedt, the head of the community banking division that included the fired employees was recently allowed to retire at age 56 with a $125 million going away present.  What do you think the odds are that the severance agreement has some pretty mighty anti-whistle-blowing provisions?

People who did try to blow the whistle faced retaliation accourding to this CNN Money article.


It wasn't just whistleblowers who who tried to object to the fake accounts.  Duke Tran was fired from Wells Fargo after he tried to expose the practice of obscuring problems with documents used to support Wells Fargo's mortrgage foreclosures.


All of this is off the topic that I want to raise, and that is - what's it like to work at Wells Fargo?  I googled "I was fired by Wells Fargo, and here are a few tidbits that I discovered.

Wednesday, September 21, 2016

Were you sued by Nextgear Capital, Inc. in Hamilton County, Indiana?

Nextgear Capital, Inc. is a company that provides floorplan dealer financing for car and RV dealers. Nextgear has grown rapidly, and it finances a lot of dealerships, especially small dealers.

It appears that Nextgear also sues a lot of dealers. Although I usually represent car buyers, not dealers, it just so happens that int he past month I was contacted by two people relating to suits against them by Nextgear Capital.  These people had very different stories, but I was surprised to get two business loan intakes involving the same company within weeks of each other.  I checked to see how many lawsuits Nextgear files, and it apears that recently they have been filing about a dozen a month.  That's a lot for business-to-business cases.  It's not illegal, just unusual.

Nextgear finances dealerships all over the country, but their contracts specify that venue for disputes will be in Hamilton County, Indiana.  Because Nextgear finances a lot of small mom and pop dealerships, nextgear frequently gets third party guarantees on the loans.  Many people who Next Gear sues may have a tough time defending the case in Indiana.

Understand that the restrictions on where businesses can sue consumers don't apply to business-to-business contracts.  It is very likely that if you signed a contract with Nextgear either as a dealer or as a guarantor, that Nextgear can enforce the venue clause and require you to defend yourself in Hamilton County, Indiana.  That being said, you are entitled to get service of process and to know about a lawsuit before a default judgment is taken against you.  If a creditor gets a default judgment against you, and you had no notice at all of the suit, there is a good chance that if you hire a lawyer, the lawyer can get the default judgment set aside.  After the judgment is set aside, you likely will have to fight Nextgear on the merits of the claim, and fight in Indiana.

I am available to take defense cases on behalf of out of state car dealers and guarantors who are sued by Nextgear Capital, Inc.  You need to understand though that commercial litigation cases are expensive to defend. You might have to come to Indiana to defend the lawsuit.  If you are a consumer or a business person, think twice before you sign a contract that has a jurisdiction and venue clause. These clauses are only sometimes enforced against consumers, but they are almost all the time enforced against businesses.

If you are sued by a complany that alleges you signed a contract, but you didn't really, it is still crucially important that you defend yourself in court if you are sued.  Your defense costs might partially or entirely be covered by your homeowners insurance if you have identity theft coverage.  Check your policy and or talk with your insurance agent.

Advice for Would-be Cosigners:

If anybody asks you to cosign or guarantee a loan - as a general rule - don't.  The mere fact that you are asked to guarantee suggests that the would-be creditor isn't secure that the borrower will pay the loan, and the lender is in the business of knowing these things.  Instead of cosigning, if the loan is for a loved one, offer to put up collateral that you could afford to lose, or subsidize the downpayment to the extent the lender doesn't require a cosigner.  I have been asked many times by cosigners if I would represent them to sue a borrower who defaulted on the loan.  I have never taken one of these cases. My retainer is always more than the expected recovery against the defaulted borrower.

In two cases I did represent cosigners who alleged their names were forged.  One involved a student loan.  These cases are interesting. I will consider taking these cases.  Generally they are the tip of the iceburg for a more complex identity theft case.

Monday, August 22, 2016

Are you a UAW Member waiting for the new Legal Services Plan? We can help you until the new Plan takes effect

In the UAW collective bargaining agreements negotiated last year with the major automakers, there was an agreement to bring back a new legal services benefit. The autoworkers had given up the legal services benefit in the austerity period following the great recession.

It was my privilege to serve UAW Members for over 16 years as a staff attorney at UAW Legal Services Plan's Indianapolis office.  I still serve numerous UAW members and their families as a private attorney.  I also proudly drive a UAW-built vehicle, a Ford C-Max.  Like the UAW members, I have been trying to find news regarding the new legal services plan.

I have had members tell me that they haven't heard any news about when the new legal services plan is to become effective and what it will cover, and they ask me if I know anything.  Unfortunately, no.  I am not part of the group that is putting together the new plan.  I know that it is not an easy thing to do organizationally. What they have to do is put together a not-for-profit law firm from scratch that is license to practice in numerous states; and they have to set it up in a way that is cost-efficient and  tax-efficient for the automakers funding it and for the workers receiving the benefits.  When there is something concrete, perhaps the information will be posted at the old UAW Legal Serfices Plan website linked here.

If you are a UAW Member or family member and you have a legal issue that you want to have addressed before the new Legal Services Plan takes effect, please feel free to call me at 317-662-4529. If you are outside of Indiana, I suggest you try Googling the name of the attorney who used to serve you with UAWLSP.  Many of the prior Plan attorneys have gone into private practice.  You might also find them on AVVO.comAVVO.com.

Are You Getting Promotional Inquiries on your Credit Report from Capital One Bank?

Most people know that every time a potential creditor pulls your credit report in connection with an application for credit, your credit score is slightly affected.  This type of inquiry is known in the trade as a "hard pull".  There is a second kind of credit report access called a "soft inquiry" or "soft pull." These inquiries are properly for the purpose of a firm offer of credit (a promotional inquiry), an account review of an existing account or for the collection of an existing account, or for the consumer's own use. Sometimes a soft pull is appropriate for confirming the identity of a person.

Because they aren't part of your credit score, soft pulls are not thought of as being as damaging as hard pulls - but that might not always be true. In fact, for privacy purposes, the soft pulls may be even more damaging because they are not tracked as closely.  You might not even know who had access to your credit file.

Right now I am looking into whether Capital One Bank has been accessing a large number of consumer credit files on a  large number of occasions without making a  corresponding firm offer of credit in exchange for the information.

The next time you check your credit report (available for free one time a year from www.annualcreditreport.com), pay attention to the sections marked "Promotional inquiries" and "Account Review Inquiries".  The promotional inquiries should generally not have the same companies getting your report on many occasions.  The account review inquiries should relate to companies that you have actually done business with or with third party debt collectors who are currently servicing one of your accounts or who did so in the past.  If you don't remember receiving any offers of credit, or if a creditor listed under an account inquiry is unfamiliar to you, you can write that company, give them your name, address and partial social security number (partial only), and ask them to tell you the reason they accessed your credit each time.  Ask them to identify the account they claim to be servicing; and ask them to explain to you what firm offers of credit they made and when.  If they can't answer these questions to your satisfaction,  you should talk to an experienced consumer lawyer in your area. You can find one through the National Association of Consumer Advocates' "find an attorney"  page linked here.http://www.consumeradvocates.org/find-an-attorney

Friday, August 19, 2016

How to address problems with a new Recreational Vehicle

As one of a very few consumer lawyers in Indiana, the state where 2/3 of all new recreational vehicles (RVs) are built, I get a reasonable number of calls from people all over the country complaining of defective vehicles and shoddy workmanship. The number of complaints has increased lately as the economy has been doing better. RV sales are healthy and manufacturers are churning them out as fast as they can. - Maybe not with the same attention to detail. The good news is that most of the time that people call me, they don't need me - yet, because they haven't given the manufacturer a suitable opportunity to fix the defects. Here are some of the recreational Vehicle manufacturers located in Indiana:

 Crossroads RV
 Evergreen RV
Forest River RV
Heartland RV LLC
Jayco, Inc.
Keystone RV
Nexus RV
The RV Factory
Thor Motor Coach
Tuscany Luxury Motorhomes

 Though there may be some cost savings in buying an RV directly from the manufacturer (usually in the Elkhart, Indiana area); there are some benefits in buying from an authorized dealer near you. The reason is that if you buy from the manufacturer, the manufacturer may require that you deliver the vehicle back to the manufacturer at your expense to fix the defects. If you complain and make a fuss, the manufacturer might relent and have you bring the vehicle into a service center close to you; or they might even fly somebody out to fix your vehicle in some extreme cases. If you buy a vehicle directly from the manufacturer in Northern Indiana, and if you can't resolve your differences out of court, you may have to sue the Manufacturer in Elkhart County, Indiana - a county where the majority of the jobs directly or indirectly are tied to the RV industry. How sympathetic do you think an Elkhart County jury would be to your claim? We try to set up the case so we can file it in Federal Court, but that isn't always possible.

 Understand that the Lemon Law in Indiana (and in most states) does not apply to most recreational vehicles. Your warranty protection comes from the express warranty of the manufacturer and the implied warranty of merchantability. This also means that it is a very rare situation that you can require the manufacturer to buy the vehicle back or give you a replacement. Correspondingly, if you buy a used RV, you should only expect the protection of a narrow interpretation of whatever written warranty is given, and realize that there may be no implied warranty at all. For this reason, before you buy a used RV, I recommend that you pay for a professional inspection by a member of the NRVIA (National Recreational Vehicles Inspectors Association). You can find one in your area at www.nrvia.org. If you buy a new RV which exhibits numerous an/or expensive problems relating to workmanship early in your ownership, it may also be prudent to get a NRVIA inspection. An NRVIA inspection report that backs you up takes you out of the "unreasonable owner" or "morning after regret" category.

Keep in mind, that usually if you buy a used RV, it will usually be the dealer or a third party warranty company providing the warranty, so your claim would be against the dealer or the third party warranty company. Before you hire a lawyer, it is essential that you document each defect that you want the manufacturer to address, and present your claim for warranty repair in detail and in writing. It often helps to have pictures documenting the problem. Remember the longer you wait, the more likely it is that the problem will be attributed to normal wear and tear. You have to give the manufacturer at least one (and often more than one) attempt to resolve the problem before you can turn it into a legal claim. (There can be an exception to this rule under the U.C.C. doctrines of rejection/revocation of acceptance; but as a general rule, you need to give the manufacturer a chance to fix the problem.)

Don't rely on anything the manufacturer or dealer promises you on the phone. If you receive a promise on the phone, send the person an email immediately afterwards confirming what was said in your conversation. If you have a significant problem that still exists after the manufacturer has had the opportunity to inspect and repair the RV, you can contact a lawyer. You can contact me through my website here , or if you are outside of Indiana, you can find a consumer attorney in your area through the National Association of Consumer Advocates "find an attorney" page, linked here.

 If you are considering buying an RV, I want to point out that everything about the RV ownership experience is potentially expensive. If you have to strain your finances to afford the RV payment that you are considering, it's probably not the RV for you. RVs can be expensive to buy, finance, insure, maintain, repair, and move. It is also potentially expensive to litigate an RV defects case. Whatever attorney you hire, it is likely that your attorney fees will be at least $2,000. You can expect tht your attorney will try to set up a claim in such a way to try to get the other side to reimburse you for the attorney fees paid; but that doesn't always happen, and you are unlikely to find an attorney who will take on a complex RV defect case for a purely-contingent fee.

When I do a consumer case involving product defects, whether it is an RV, a car, or even an alarm system, I usually combine a customer complaint strategy with my legal work.  Sometimes the court of public opinion gives you a better remedy than the court of law.

Friday, July 29, 2016

Wells Fargo Forced Placed Car Insurance

Is Wells Fargo charging you for insurance ("forced placed" insurance) every month even though you have sent them proof of insurance? If this applies to you, whereever you live, please call my office at 317-662-4529. We are investigating the possibility for a class action against Wells Fargo for this practice.