TRENTON, New Jersey (WABC) -- 7 On Your Side has been on the front lines of a growing problem: Defunct dealerships leaving customers in the lurch.
In just the past few weeks, we saw the problem explode -- soaking dozens of car buyers a combined six figures in payments for cars they no longer owned.
But at least in New Jersey, there may be help on the way.
Both Irma Brainard and Luis Quinones are on the hook for a combined $32,093.77 to pay off remaining financing for cars both traded in to Norman Gale Buick. The dealership defaulted instead of making the pay-outs.
Last fall, the lights suddenly went out at that car dealer. Just 19 miles away, the doors are locked shut at VW of Union.
Both dealerships are run by Carmine DeMaio, who along with his partners and their companies, are being sued by the two dealerships' financing companies -- alleging they defaulted on a combined $45 million in loans.
Both Brainard and Quinones saw our previous stories online and called 7 On Your Side after struggling to make double car payments.
Brainard found out the car she bought had a lien on it and the dealership wasn't even supposed to sell it. Then she made a startling discovery about her old car she traded in.
Surprisingly, there are no laws protecting, but there is a state bill pending requiring dealers to pay off trade-ins within 15 days and face fines if not.
"Consumers have to be protected here, they go in and have a seamless transaction and ride out with a brand new car, and then a month or two someone says, 'oh you still owe me,'" said Assemblyman Paul Moriarty, D-NJ.
His bill to protect both dealers and consumers will be heard in the Consumer Affairs Committee that Moriarty chairs this month and hopefully move out of the House for a vote by the Senate and signature by Governor Phil Murphy in March.
"The experiences you encountered and the consumers you spotlighted certainly show we need to get something done," Moriarty said.
In the meantime, we helped get GM financial to forgive Quinones' almost $15,000 lease loan and Brainard got her old car keys back, plus the bank took her new car back and released her from the loan. She drove her old car right off the lot.
"I'm pretty resourceful, but I have you guys to thank, I wouldn't have gotten this far without you," Brainard said.
Some big takeaways here. Buyer beware -- if you do one of these rollover loans and the dealership doesn't make the payoff, you will be responsible for it.
That means you could wind up paying for two cars - or have your credit score dinged.
If you did this deal, stay on top of the dealership to make sure they make the payout before a month after your deal.
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Action being taken at New Jersey Statehouse amid 7OYS investigation into defunct car dealerships
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