Steve Moskos' Blog

Are Car Maintenance Plans Worth the Cost?

11/29/2019

Buying a new car is an exciting time. When you are sitting at the dealership, the salesman may try to offer you many other products for your vehicle and it is hard to make a quick decision on what you really need. A car maintenance plan is an option that your salesman may try to convince you to purchase.

What is a Maintenance Plan?

If you are offered a vehicle service plan, ask for specifics about what that plan is. Many dealers use that term for both extended warranties and car maintenance plans.

A car maintenance plan covers services that the vehicle’s manufacturer recommends be completed to keep the car running in optimum condition. These things could be oil changes, filter replacements, and tire rotations. Dealerships have learned that offering maintenance plans can be a very profitable revenue stream for their business.

These plans are prepaid and can be very valuable to have, but you need to carefully consider what is covered and what you would pay out of pocket compared to the cost of the plan. Always read all of the fine print details, and if you don’t understand the contract, consider having an attorney explain it to you.

The Positives of Purchasing a Plan

Dealerships rely on their service departments for a large part of their income. By selling car maintenance plans, they are guaranteed that their department stays busy. These plans are prepaid and often offer discounts on the services you will need. Remember, though, that what sounds too good to be true often is, and you still need time to think about whether you actually need the maintenance plan. Do not let a sales person talk you into something that may not fit your needs.

For example, the average cost of an oil change in South Carolina is around $30. Assuming you change your oil as recommended, or about every three months, that is $120 a year. Tire rotations are about $40, and it needs done once a year. Filter costs vary, but you may plan on about $100 for filters a year. If this is your plan of maintenance, you will be paying about $260 a year in car maintenance. (You also need to check your car’s owner’s manual for recommended maintenance.) If you can get a car maintenance plan for less, it may be worth it.

The Negatives of Purchasing a Plan

Before you purchase a plan, carefully read your owner’s manual. These can often be found online if the dealership doesn’t have one. See what maintenance the manufacturer recommends. Some dealers still use outdated information to try to convince customers to purchase the plans.

An example of this would be that new vehicles require very little maintenance. Many cars will go for more than 5,000 miles (instead of 3,000) between oil changes. This reduces your out of pocket expenses. Many manufacturers now state that your vehicle will only need significant servicing every 30,000 miles. If you don’t drive much, a car maintenance plan is probably not a good option for you.

Also, once you purchase the plan, you will have no options about who services your car. Unless you decide to pay out of pocket, you will have to take your car to the dealership for services. If you aren’t happy with their service, you have no options. Another thing to consider is that the things that do wear out quickly, such as wipers and brake pads, are not usually covered by maintenance plans.

The dealership may also sell the plan according to their schedule of maintenance and not what is recommended by the manufacturer. If you drive often in extreme heat or cold, oil changes may be recommended more often, but your dealership may not take these conditions into account, and you will have to pay for the oil changes yourself.

The Final Cost

If you decide to purchase the car maintenance plan, be sure to pay for it in full and do not add it to the total of your car or you will be paying interest on the plan, just like the purchase price of the car. To make the best informed decision, make sure to find out exactly what is covered and compare prices of those services to the total cost of the plan.

How Unpaid Debts Can Affect Your Financial Future

11/8/2019

Unpaid debts can affect your life for several years. You may be stressed over how to pay your bills and think it would be easier to not pay them, but not repaying what you owe can cause long and short term problems you may not have considered.

Short Term Effects

You may have additional fees, such as late or collection fees, added to your debt which will make it even harder for you to pay the debt.
Your credit score will drop.
You will more than likely need a larger down payment for purchases or deposits.
You will have a harder time refinancing any loans you may have or to get loans to make new purchases.

Long Term Effects

Higher interest rates on new loans.
Interest may be continually added to the debt.
You may not be able to get loans in the future.
You may find it difficult to raise your credit score as negative items often outweigh the positive items.

Depending on what kind of bills you haven’t paid, you may also have other financial problems.

If you haven’t paid your utility bills, such as electric or gas, it may be harder to get new service if you move and you may be required to put a deposit down on your service.
Auto loans that are not paid can result in your car being repossessed. Without transportation, losing your job is a real possibility which will cause even more problems. Even if you voluntarily choose to give the car back, you will still have repercussions on your credit score.
If you don’t pay your phone bill, it can be difficult to find another phone service provider that will be willing to offer you a service plan.
Not paying your mortgage can result in the bank foreclosing on your home and it may also make it nearly impossible to get another mortgage loan in the future.
You may be evicted if you don’t pay your rent. Many agencies check your credit score before offering you a lease so being evicted once will make it difficult to find another place to live.

A low credit score can also raise insurance rates. You may also be denied new credit cards for many years. Besides the financial effects that unpaid bills have, the stress can cause health problems and depression. Many companies would rather get some of their money than none so contact your creditors as soon as you are having problems to see if you can work out a payment plan you can both agree on.

Top 5 Reasons You Need a Local Lawyer Handling Your Case

10/28/2019

In a world where you can Google, search the internet, and even get legal counsel, it may seem strange to have a local lawyer. But ask yourself this, would you want a to see a medical professional you have never met before treating you for something serious? Then this area of your life shouldn’t be fast tracked to the internet either. You need a local lawyer in your corner for many reasons.

Laws Differ: State laws, local laws, and even local ordinances can affect your case. Local lawyers can determine all the nuances of your case and be able to protect you better. Lawyers can write your will, work through a divorce, help you set up guardianships for your children, and sell your home. They can also help with businesses by setting up your LLC or Sole Proprietorship, creating contracts, protecting you from lawsuits, and even meeting state and federal compliance.
Whole Story: Meeting with a local lawyer allows him/her to ask follow-up questions to see the entire picture. They will be able to pick up on visual cues, verbal cues, and even your body language that will enable them to guide you in telling your story in a more caring manner.
In the Know: Local lawyers know local judges and other lawyers. This knowledge may be beneficial to your case as they already know what judges prefer when trying a case and how to interact with attorneys that may be representing your opponent.
Accessibility: You are able to meet at a mutually agreeable time. All of us have had appointments that are hard to keep, hard to get off work for, and even set for one time and three hours later you are still in the waiting room. Local lawyers realize your time is precious and try to ensure that their schedules reflect that for each of their clients.
Cost: Local lawyers typically cost less, but even if they don’t, you’ll spend less money utilizing a local lawyer because they are already familiar with the state laws. Attorneys operating outside of the state, like through a lawyer mill, will need more time to review the cases and laws that support your case. Local attorneys already know what causes of action will apply to your case.

Protect yourself by seeing a local professional for any legal issues that arise in your life. Knowing that someone is in your corner and protecting you legally gives you substantial peace of mind. Having that person be there through some of your more difficult life moments is irreplaceable.

Steps to take when buying a car from a private seller

10/21/2019

When buying a car from a private seller, you have few guarantees or warranties to fall back on. Here are some steps that you can take to reduce your chances of being cheated by an individual looking to ditch a defective car.

1. Set Your Car Budget Before You Start Shopping
The best way to avoid getting drawn into spending more money for a vehicle is to decide how much you are able to spend and have this number clear in your mind. Only look for those cars within your budget and don’t be talked into spending more.

2. Select Your Target Vehicle Model
Check Kelley Blue Book to see what model years and mileage you can expect from a car that will fit within your budget. Use Consumer Reports to see reliability ratings and check the Insurance Institute for Highway Safety to review crash safety ratings for the make, model, and year for the car you are going to see.

3. Test Drive Your Target Model
It is important to feel how the car you are going to buy handles. Are there any mysterious noises when you drive the car? Check how the car handles in city traffic and on the highway.

4. Get the car inspected by a mechanic
For about $50, you can have a mechanic at a car shop do a used vehicle inspection. This is useful to help you avoid buying a car with major problems. It is also useful to have the inspection results when negotiating the price.

5. Negotiate the Best Price
After gathering information about the car from your test drive and car inspection, show the seller book prices or a list of repairs that are needed. Sellers are more likely to accept the lower price if they think it is rational and that other buyers would likely come to the same conclusion.

Following these steps will help you make a good deal with the private seller, but there are no guarantees. It is important to find out as much as you can about the car before you purchase, and doing this will lessen the likelihood that a seller will take advantage of you.

The dangers of payday loans

10/15/2019

Payday loans have a strong appeal when you find yourself struggling to make it to the next payday. They’re quick. They’re easy. There is no credit check. And the money is there instantly. However, they are extremely dangerous and should be approached with caution.

The first major danger is borrowing against your future self. By using a payday loan, you are giving up part of your future paycheck. Unless you budget carefully you will need another payday loan with your next paycheck to make it through to the third payday and so on. This could set up a series of payday loans that may be impossible to pay off.

The biggest hazard is the interest rate. Average interest rates vary from 300% per year to almost 800% per year. For each $1 you borrow, you could have to pay $8 back with this type of loan.
One last, well-hidden danger is that this loan can affect your credit score. If you struggle paying back your loan, it can be sold to a collection agency. When your loan is sold, it will show up negatively on your credit score as a non-payment of a loan. Then the collection agency will be merciless in trying to get you to pay your loan back. This leads to threatening phone calls and nearly continuous mail.

To avoid this drastic financial step, ask for help from friends and family, go to a bank and ask for a small personal loan, talk to organizations that help you set up a budget, and go to other organizations that will help you financially get back on your feet without the pressure of a payday loan.

Here is a short list of resources to get you started:

The Department of Justice offers a list of Approved Agencies for credit counseling.
https://www.justice.gov/ust/list-credit-counseling-agencies-approved-pursuant-11-usc-111?op=Go

Here are questions to ask a credit counselor: https://www.consumer.ftc.gov/articles/0153-choosing-credit-counselor

Nerd Wallet can help you set up a budget.
https://www.nerdwallet.com/blog/finance/how-to-build-a-budget/

For even more financial advice, Dave Ramsey has free resources.
https://www.daveramsey.com/

Tips for buying a car after a hurricane

10/8/2019

After a natural disaster, such as a hurricane, one of the first items people want to replace is their damaged car. They need transportation to take care of all of the other details associated with the after affects of the hurricane. And usually, a car is the easiest to replace. However, after a hurricane, you need to be very careful about the car you purchase.

Ask when the car was put up for sale. If the car was for sale before the hurricane, you still need to check for flood damage, but it means the seller had already intended to sell it and not just selling it because the car was flooded and repaired. If the car was only listed as for sale after the storm, and the seller is very motivated (is willing to lower the price and not try to negotiate with you), be wary of it. It is very possible that it was flooded during the hurricane and the owner is trying to sell it before any damage becomes obvious, such as electrical problems and rust.
Ask if the car was flooded during the hurricane. Sellers must tell you about any damage that they are aware of, but you need to look for signs the car was flooded, too.

Ask to see the title. If the car has a flood brand on the title, it means it has been underwater. It does not mean the vehicle has been repaired. Beware of this. Also understand that unscrupulous people may dry out a car and send it to another area with a new title.
Ask for the car’s history report. If the dealer doesn’t offer it to you, ask. Check the date to be sure it is current and look where the car has been registered. If the dealer refuses to show you the report, walk away.
Smell the car. The inside of flooded cars can be cleaned, but it is really hard to get rid of the musty smell. If the car smells strongly of air freshener, walk away as the seller may be trying to cover it up.
Look for rust and dirt in unusual areas. Check areas under the hood where a quick washing may not have removed evidence of flooding.
Check the flooring to see if it is new. New flooring in an older car is a sign that it was recently replaced – perhaps to disguise flood damage.
Look at the headlights. It is hard to get water out of partially sealed areas, like lights. Fogging on the lights is another indication of flood damage.
Be careful about underpriced cars. If it looks too good to be true, it probably is.

3. Ask for a full inspection by your mechanic. Once the car passes your initial inspection, bring a mechanic you trust to check out the car. They will know how to find flood damage.After a major disaster, it is truly a seller’s market as thousands of people may need to replace their cars with a limited supply. It is understandable that you may be in a hurry to replace your car, but go slow. Think about your options and be sure to thoroughly check the car you are considering. If you rush this decision, it may be one you come to regret later.

The Top 5 Things you Should Know about Debt You Can’t Pay

9/30/2019

Few things are as stressful as owing money and not being able to pay that debt. Most people feel this at some point and have questions about what will happen. To help alleviate anxiety about your debt, we have written about five things you should know about debt.

The Affect on your Credit Score
Your credit score is used for many things besides being able to get a loan. Higher credit scores often means better rates on credit cards, loans, and even insurance. An overwhelming amount of debt will lower your score.

Negative information stays on your credit report for seven years. Oftentimes, you will need to request the negative information to be removed after the time has expired. However, even if the information is gone, you may still owe that debt.

What Debtors Can Do if You Can’t Pay the Debt
First, understand that debtors are never allowed to lie or be abusive when they contact you to collect debts. They may try to bully you into payment agreements, but there are laws that protect you.

Debtors are also not allowed to contact you at inconvenient times (before 8:00 AM or after 9:00 PM) or places. Once they have been told you cannot receive calls at work, they can’t call there.
The debt collector can’t talk about your debt with anyone but you or your spouse, but they can contact other people to obtain your contact information.

A debt collector can sue you for the money you owed within a certain period of time. Any time you receive legal papers about your debt, you need to contact an attorney immediately and only respond through him/her.

If a Debt Collector Breaks the Law
If you feel a debt collector has broken the law, you may be able to sue the collector within one year of the violation. You will have to decide if any possible damages you may receive are enough to make a lawsuit worth your time. Again, this a discussion for you to have with your attorney.

Wage Garnishment
Each state has different laws about wage garnishment. A creditor must obtain a court order to garnish your wages. In South Carolina, wages cannot be garnished for commercial/personal debt. However, debt pertaining to child support, taxes, alimony, and student loans can be collected through garnishing your wages. Any federal benefits you may receive may also be garnished for those debts.

How Long a Creditor can Collect Debt
Creditors only have a certain number of years to collect your debt. This time begins the first time you miss a payment. Once the statute of limitations expires, the debt is considered “time-barred.” However, you need to be aware that every state has their own laws on how long the statute lasts and that may be different depending on what types of debt you have.

Often, creditors will work with you to resolve your debt. Most of the time, they would rather get a small amount from you each month than have to take you to court. For this reason, it is a good idea to contact your creditors immediately when you are having problems making your payments. Try to find a solution that works for you and your creditor before legal action is taken against you.

What You Need to Know About Salvage Titles

9/25/2019

Shopping for a used car is often more difficult than buying a car that is new. While odds are good a new car isn’t going to have been wrecked or have damages you can’t see, sometimes, used cars do. Some of those cars have salvage titles, and they are some of the most dangerous vehicles on the lot. That’s why it’s important to know what you’re buying before you sign the contract.

Why do cars get salvage titles?
In South Carolina, a salvage title is issued on a car when the cost of fixing the vehicle is 75% more than the value of the car. When this happens, the insurance company tells the DMV that the damage has met the 75% mark, and the DMV issues a salvage title for the car. Some of the reasons for a car being a “total loss” are flooding, electrical fires, and collisions.

How can you be sure not to buy a car with a salvage title?
Research is the best thing you can do to ensure that you don’t buy a car with a salvage title. Start by asking the seller if the car has been previously wrecked? You can also use the Vehicle Identification Number (VIN number) to look it up with Carfax or the National Insurance Crime Bureau. You can also check if the vehicle has been reported stolen by calling a police department. It may be in your best interest to get the car inspected by a reputable mechanic and/or body shop as well.

Is it illegal to sell a damaged car?
Although it may seem illegal to sell a car that may be unsafe, it is legal if the car has a salvage title. However, a car salesperson must disclose that the car has a salvage title. A dealer cannot and should not hide the fact that a car has been deemed a total loss in the fine print of the contract. Dealerships have the expertise and resources to know when a car has been totaled so there is no excuse not to disclose the fact. Unfortunately, disclosure doesn’t always happen, and you can end up with a car that is too dangerous to be driven.

To avoid the costly mistake of buying a car with a salvage title, do the research. Learning the history of a car before you buy it can save you a lot of money and heartache down the road. If you do discover you’ve unknowingly purchased a car with a salvage title, you should contact a reputable attorney immediately so you’re not stuck with a car you don’t feel safe to drive.

What to Watch out for When Purchasing a Car over the Internet

9/17/2019

It is becoming very common for people to turn to the internet for a car purchase. If you are considering it, be careful and follow these tips to get the best deal.

Do your Research

Before you begin your search for your car, do plenty of research about the type of car you want. Discover what the car usually sells for and any problems other people have had with the car, including any recalls.

Beware of Low Prices

Cars posted for sale with ridiculously low prices that are well below market value should send up a red flag. Sellers tend to always have a reason for such prices. They are being deployed or someone is sick or has died, and they need the money right away. On the other hand, the seller may want to get rid of the car because he wrecked it or the car has had lots of mechanical problems.

The pictures that are posted may be stock photos and not that of the actual car. Always, always be careful when the price is too low. Remember, if it seems too good to be true, it probably is.

Research the Seller’s Information

If you are buying from an individual, you can search for that person on the internet, too. You can also check dealer ratings. Research delivery options. Another big red flag is someone who refuses to communicate with you in person.

Make sure you see a Title

Ask the seller to send you a photo of the title and a photo of the VIN plate on the dash. When you look at the pictures, make sure the person who is selling the vehicle is the person on the title and that the title’s VIN matches the one on the dash.

Obtain an Outside Inspection

If you are unable to view the car yourself, have a reliable inspection done by someone other than the seller or dealer. Ask for photos of any damage that the inspector may see and for a check of the odometer reading to make sure the seller has given you an accurate number. If the seller won’t allow an inspection, walk away.

Ask for a History Report

Dealers will have access to histories of their vehicles if it has been serviced. Ask for copies of maintenance records to prove that the car has been regularly serviced such as oil change. If the seller refuses to give you a copy of any of these records or gives you excuses why they can’t be produced, don’t buy the car.

Why you should never take a newly-purchased car home if the financing isn't complete

5/22/2019

You wouldn't drive a car that's not fully insured, and you wouldn't operate a vehicle without a driver's license. So why do people take home new cars before the financing is finished when they don’t truly know how much that shiny new car will cost them in the long-run? The scary thing is, even if you prepare yourself, you can still get fooled because a car dealership can may tell you a car is financed – even if it’s really not.

After dropping thousands on a new car, you'll want to hop in and get on the road immediately, which makes sense. Few can resist the temptation of the new car smell. Car dealerships know that, and they can use it to charge you a lot more money than you thought you were going to pay for that car. This tactic is called yo-yo financing, and although it's not legal, 27% of people reported being victims of these scams. One Miami auto fraud lawyer even claims that 30% of his law practice deals with these cases.

What usually happens is a dealership and buyer agree to a sales price. The buyer leaves thinking the deal is final. Days or even weeks later, the dealership contacts the buyer to let them know the car has not been financed with the original loan options. They have, however, found another finance option with a new rate that's much less favorable. If a buyer refuses to cooperate, the dealership may threaten legal action. At that point, most buyers will start to feel the pressure and agree to the dealership's demands, which usually means a loan contract at a higher rate or a higher down payment than the one they initially discussed. Meanwhile, the dealership can might still sell the buyer's trade-in vehicle (or just say they did, since the buyer can’t be sure). They may even try to keep the down payment to get the buyer to agree to their terms.

This scam is also known as spot delivery. After agreeing to purchase the car, your dealership might tell you the financing is all set and that the car is yours. That may not be a problem for people with good credit scores, but someone with a lower credit score could get a call days after driving their new car off the lot letting them know the bank would not buy the contract from the Dealer. If the financing institution will not buy the contract, the sale may not close, and the buyer in this situation may have to return the car or pay the balance in full. The Dealer may even try to claim the buyer owes money for the mileage he put on the car.

Is it really worth it to pay thousands more down the road just to get your new car a few days early? Certainly not. Going into a deal, a buyer should know and understand what they're agreeing to – no matter how fine the print. You may even want to get pre-approved for a loan from a local credit union or your bank so you know what the terms of the loan are before you even set foot on a dealership's lot. And if you're desperate for a car, rent one until the paperwork is signed. A couple hundred dollars on a rental can save much more than you think down the road.

<<Previous