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nicolia

Guest
Home State: Texas

OK, I've got another question from my father's file.

Question: Is it legal to lie about financing terms to make a sale, if the credit app has the true financing terms listed on the back in very small print?

Situation: My father recently retained the services of a contractor in San Antonio, Texas to put new siding on his house. $8900 was financed through a third party, but the contractor acted as agent for the bank. The contractor told both my mother and father that the financing came out to roughly $156 a month for 5 years (60 months). My dad did some quick calculations and came up with 1.43% for the terms and thought that to be a great term. He asked the contractor if it was indeed 1.43%, and the contractor said that he culd not give an exact amount because it was a revolving account and changed with every payment....but that it would be roughly $156 a month for 5 years. My father agreed to these terms and signed the contract and credit application.

Lo and behold, when the first statement came in, the terms were 15.74%! I called the contractor to find out more about the deal and discovered that NOTHING my father signed had the terms written out in detail. In fact, the terms were only referred to as "Standard Plan." There was no mention of actual financing terms on any document. The contractor did say that my father was given a separate document that listed out the financing terms in detail.....which is a complete lie.

Follow up questions:
1. Did the contractor do anything illegal by giving false info on the financing terms?
2. Does a company in Texas need to have financing terms listed and discussed in detail...with a corresponding signature from the applicant?
3. Is sucha case open for both civil and criminal charges?
 


racer72

Senior Member
1. Did the contractor do anything illegal by giving false info on the financing terms?
No. The contractor is not the one doing the financing. It is up to your father to read the entire contract, including the small print. Any questions about the contract should have been directed at the finance company, not the contractor.

2. Does a company in Texas need to have financing terms listed and discussed in detail...with a corresponding signature from the applicant?
Yes, no and no. The terms must be listed, they do not have to be discussed in detail, and no signature is required.

3. Is sucha case open for both civil and criminal charges?
Not from what you have posted.
 
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early999

Guest
if the contractor did infact give a seperate document that listed specific detail, does he claim your father signed it? also, the "standard plan" usually refers to the similiar payment and interest that his own material supplier charges him. it sounds a like he gave B.S. to your father if he told him 1.43% unfortuneately , theres no proof of that. i geuss if he did the work and was willing to finance the job as a contractor, gee, what the heck is your father complaining about??? 99 % of contractors get a down payment and then the rest immediately upon completion. the contractor probably got the credit for the material and then was told alot higher interest than what your father came up with. to look at the other side of the fence, should the contractor lose money then cuase of the higher interest?? i think if you talk with your father ya all could come up with a happy medium that everyone can live with if the contractors any kind of businessman. i dont know if your father is simply not going to pay him, but that wouldlnt be right. the last thing is , 8900 sounds like a pretty low price to begin with when it comes to siding homes. anyresponse?
 
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nicolia

Guest
Racer72 -

It seems very strange to me that the contractor, who said they were the one offering the financing, did not commit some type of illegal activity when they falsely gave inaccurate information on the financing terms.

My father was provided with no financing terms, basing his decision on the information given by the contractr who offered the financing.

If it is true that the contractor did nothing illegal, there is nothing to stop people from out and out lying about terms strictly to make a sale.
 

racer72

Senior Member
That is the reason consumers have to watch out for themselves. You even admit it was your dad, not the contractor that came up with the incorrect percentage. Nothing in your post suggests the contractor did anything wrong or illegal. I would suggest your father talk to a local attorney for guidance and to see if there is any recourse. But I doubt it.
 
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nicolia

Guest
Racer,

I know that my personal thoughts of whether the contractor did anything wrong or not mean nothing in the face of the maw...but I have to assume that it is not legal to tell someone that a remodel job will be $156 for 60 months, when the true price is $156 for more than 108 months.

Isn't this fraud? Again, if the contractor did nothing wrong here, what is to stop anyone from lying about true sale terms? This would mean that I could go around and sell special family bibles to people, telling them that they would owe $10 a month for the next 2 months and they actually cost $10 a month for the next 90 months?????????

This cannot be a legal practice.
 
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nicolia

Guest
sorry...."face of the law"

wanted to get that in before one of the usual posts hit about spelling...
 

divgradcurl

Senior Member
"My father was provided with no financing terms, basing his decision on the information given by the contractr who offered the financing"

Your father made a mistake by basing his decision on a verbal commitment. Nobody should ever obligate themselves based on a verbal promise -- read the contract before signing, no matter how good things sound sound or how excited you are to get going.

"It seems very strange to me that the contractor, who said they were the one offering the financing, did not commit some type of illegal activity when they falsely gave inaccurate information on the financing terms."

The problem is, your father signed a contract -- a later written contract supercedes any prior verbal promises. That's why you ALWAYS read the contract before signing.
 
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nicolia

Guest
I understand the point about reading the contract....the point here is that the contract said NOTHING about financing terms.

The contractor says he has a separate sheet that he showed Dad that contains the financing terms --- this is a lie. Both my mother and father say they were never shown a document with the actual terms. If they had seen 15.74%, he never would have signed anything.
 

divgradcurl

Senior Member
Your dad obviously signed SOMETHING that obligated him to the financing terms -- if he didn't see the "seperate sheet" then he signed a contract WITHOUT reviewing all of the necessary details -- and that's where he screwed up. Simply put, when your father was about to sign the contract, he should have read it and, seeing that there was nothing concerning financing in the contract, not signed it until all of the pertinent information was available to him.

Obviously we don't have the benefit of having the contract in front of us to review, but from your description, if the contract he did sign obligated him to the financing without having the financing details spelled out, then that should have raised a red flag. It's what's in the written contract that counts, not any oral promises or explanations. If, after reading the contract, he still didn't understand it, he should have enlisted the aid of an attorney -- a few hundred spent at that time could have saved him the potentially thousands he is going to be obligated to pay now.
 
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nicolia

Guest
I just can't believe that the contractor did nothing wrong here. I plan to take them to court, so I'll update after the fact.
 

divgradcurl

Senior Member
"I plan to take them to court, so I'll update after the fact."

Okay, but you might want to look up the parol evidence rule before getting too far into this...
 
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nicolia

Guest
A rule of evidence providing that a written agreement is the final expression of the agreement of the parties, not to be varied or contradicted by prior or contemporaneous oral or written negotiations.

----The point is that there were no terms agreed to in the final written agreement. In fact, the only thing agreed to in the written contract is that my dad agreed to pay $9000 for the siding.
 

divgradcurl

Senior Member
You mean that there is NOTHING anywhere on the contract that specifies financing? At all? That's not what you said in your first post -- you said the financing terms were on the back of the contract, and that your father took the salesman's word for what the terms meant.

"The point is that there were no terms agreed to in the final written agreement. In fact, the only thing agreed to in the written contract is that my dad agreed to pay $9000 for the siding."

That's ALL there is on the contract -- nothing about financing whatsoever? Is there a DIFFERENT contract your father signed with respect to financing? Do you have a copy of the contract, or are you getting your information second-hand? (not accusing you, just that I find it suspicious that they are trying to enforce financing terms without a signature -- otherwise that means that they did the work without getting paid up fron or without any commitment to pay, and that seems highly unusual).
 
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nicolia

Guest
In my first post, I stated that there were no terms AT ALL for the agreement my father signed. The reverse side of the contract has only special financing terms and my father was given the "Standard Plan." (You may be referring to my general Question that started the thread).

The contractor said that the "Standard Plan" terms were on a separate document that never got my father's signature.

I have all the documents that my father signed...not copies, but the originals.

In the end, NOTHING my father signed has financing terms. The only thing with his signature on it is the credit app and the contract. The credit app has nothing about terms and neither does the contract.

When I contacted the bank to determine how they can be charging the high interest, they said that I had to contact the contractor....that they were the client of the contractor and the contractor had full responsibility for anything to do with the loan.
 

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