California Dealers Fraudulently Overcharging Vehicle License Fees
A vehicle purchase contract is a complicated document. Over two feet long with hundreds and hundreds of words printed on the front and back, it is nearly impossible for the average consumer to digest all this information. Because of this, unscrupulous dealers have been able to insert fraudulent terms and charges without the consumer finding out.
In its nearly 30 years of existence, Auto Fraud Legal Center has found numerous cases of auto fraud hidden in the maze of the lengthy sales contract. The latest auto fraud dealers are committing is grossly overcharging vehicle license fees. Read more to find out how one dealer charged a consumer nearly 50 times the actual license fees!
What Are License Fees?
License fees are one of the government fees collected during the sale of a vehicle in California. The California Department of Motor Vehicles (DMV) lists on its website that the vehicle license fee is essentially a property tax on vehicles. The license fees are due with the annual registration of vehicle, as well as anytime a vehicle is transferred. http://www.dmv.ca.gov/faq/faq_vlf.htm
The purchase of a new or a used vehicle from a California dealership is considered a “transfer.” This means that license fees may be owed at the time of the purchase.
How Are License Fees Calculated?
If you purchased your vehicle after July 1, 2011, the vehicle license fee is 0.65% of the value of the vehicle. This is a decrease from the previous rate of 1.15%. The value of the vehicle is generally the cash price of the vehicle, prior to any other fees, accessories, or other charges. On the standard California form contract, this price can be found on Line 1(A)1.
To calculate your license fee, you simply need to multiply the cash price of the vehicle by 0.65%. You can also use the California DMV’s calculator, found here. To use the DMV’s calculator, you need the vehicle’s VIN and license plate. This can be found on your registration card.
The Fraud After you have calculated your own vehicle license fees, check this amount against the fees the dealership charged you. Going back to your sales contract, you can find this amount on Line 2A. If you bought your vehicle from a reputable dealer, the amount should be the same or very close.
However, if you purchased a vehicle from an unscrupulous dealership, you may see a license fee that is double, triple, or even 10 times the amount that was actually paid to the dealership! Auto Fraud Legal Center is currently handling a case where the dealer paid the DMV $19 in license fees, but charged the customer $897! This is nearly 50 times the actual license fees paid!
While all cases may not be this terrible, we have found it is not uncommon for dealers to severely overcharge license fees. It is only one line on a document covered in numbers and words. Further, license fees are a government fee, so the dealer may blame “bureaucracy” for the amount of the fee.
How Auto Fraud Legal Center Can Help Our firm has spent nearly three decades devoted to fighting car dealers and manufacturers on behalf of consumers. Our trained attorneys will be happy to review your contract to determine if you were overcharged license fees, as well as to look for any of the over 50 auto fraud violations our firm has sued dealers over in the past. Many consumers contact our office for one problem, yet our experienced auto fraud attorneys are able to find many other problems the consumer did not know about.
For a free consultation with an auto fraud attorney, call (800) 466-5366 or fill out our web contact form.