Legal Issues Facing Car Dealerships in San Antonio

 Posted on April 28, 2023 in Business Law

Owning and operating an automotive dealership comes with its fair share of complexities and challenges. Dealerships may find themselves in legal disputes with customers, vendors, and other parties. They must comply with local, state, and federal laws and regulations - and even a simple oversight can lead to significant penalties for non-compliance.

If you currently own a dealership or plan too soon, understanding your legal responsibilities is crucial. Consider working with a business law attorney who understands the unique intricacies involved in this type of business and can help steer you in the right direction. In this blog, we will discuss just some of the many laws and regulations you need to be aware of as a car dealership owner.

Used Car Buyer’s Guide

The Federal Trade Commission Buyers Guide law requires certain information to be prominently displayed in a used car that is for sale. You'll need to clearly state whether the vehicle comes with a warranty, and if so, what the warranty covers and for how long. You must also include the vehicle make, model, and year, as well as the vin number. Failure to comply with FTC regulations can lead to costly civil penalties.

Equal Credit Opportunity Act

It is unlawful to discriminate against customers based on their age, race, national origin, sex, religion, color, or marital status. The Equal Credit Opportunity Act requires dealerships to be free of bias when selling vehicles. The ECOA also prohibits dealerships from asking customers certain questions. A seemingly innocent question about whether a customer is married or has children can be considered an ECOA violation. The law also requires you to let customers know of your credit decision within 30 days and explain why a customer was denied if their loan was not approved.

Transfer of Title

If you sell a vehicle and do not yet have the title, you have exactly 30 days to have the title issued in the buyer’s name.  If you do not transfer the title, the buyer has the right to rescind the sale. Furthermore, failure to complete the title transfer within the time limit could mean that you are liable for traffic tickets and criminal offenses committed with the vehicle.

Employment Law Concerns

It is important to keep your employees informed about their rights and responsibilities. The Fair Labor Standards Act requires that you pay employees for all hours worked. You must also comply with the Equal Employment Opportunity Commission, which prohibits workplace discrimination based on race, gender, age, or disability.

Contact our San Antonio Attorney for Car Dealerships

The information above represents just a fraction of the legal concerns faced by car dealerships. Our Bexar County business law attorney provides trustworthy legal advice and skilled advocacy for car dealerships facing legal problems. Call Geoff Mayfield, Attorney at Law at 210-535-0870 to set up a free initial consultation to learn more.

Source:

https://www.txdmv.gov/motorists/buying-or-selling-a-vehicle