Governor Corzine and Attorney General Milgram Announce Agreement to Provide Vehicle Titles to Consumers of Defunct Dealership

NEWARK - Governor Jon S. Corzine and Attorney General Anne Milgram today announced that the Division of Consumer Affairs staff, intervening on behalf of consumers who purchased vehicles from a defunct Rahway used-car dealership, have reached an agreement with the finance company holding title to approximately 20 vehicles. 

"New Jersey families and individuals who have fulfilled their obligations in good faith should not and will not have their property held hostage based on the closure of a car dealership," Governor Corzine said. "My administration has worked tirelessly to protect consumers caught in these situations, and I am pleased that our Division of Consumer Affairs has reached a remedy that will allow all these New Jerseyans to use the cars they bought." 

Automotive Finance Corporation (AFC), an Indiana-based company, today agreed to provide titles to approximately 20 vehicles that consumers bought from Galaxy Motors and financed through AFC. The Division will act as the clearinghouse and contact the affected consumers and make arrangements for distributing the titles once they are received from AFC. 

Earlier this summer, Galaxy Motors suddenly shut down their business prior to transferring ownership papers from numerous customers. AFC, which had extended credit to Galaxy, subsequently filed for repossession of the vehicles in Arkansas. As a result, New Jersey buyers were blocked from receiving title for their vehicles, even though they were fully paid for. A valid title is required to obtain automobile license plates in New Jersey. 

"Through no fault of their own, because a business closed, these consumers were denied titles for cars they legally purchased and financed," Attorney General Milgram said. "They acted in good faith, made their monthly payments and deserve to drive and enjoy their vehicles. The agreement we reached with AFC will resolve their struggle to legally register their vehicles." 

"These consumers will get permanent title to their vehicles and will be able to drive their cars, trucks and SUVs without the question of ownership lingering over them," said David Szuchman, Consumer Affairs Director. "These consumers were the unfortunate victims stemming from the closure of Galaxy Motors." 

The State Motor Vehicle Commission (MVC) previously agreed to issue new temporary tags to the owners of the vehicles in question as an interim action and will assist the Division in processing the titles. 

The Division is working to identify other lenders who provided loans to consumers who purchased vehicles at Galaxy Motors. Division employees will contact those lenders and work toward obtaining vehicle title for additional consumers. 

Based on police reports, Szuchman said the Division believes at least 24 additional consumers are awaiting title to the vehicles they purchased. 

Szuchman thanked AFC for its cooperation in resolving this matter. He also cited Cindy K. Miller, Acting Deputy Director; Laurie Goodman, Acting Bureau Chief of the Office of Consumer Protection; and Investigators John Janowiak and Cullen Church for their work in reaching this agreement.       

 

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