Carolina DMV halts used-car sales at CU

NORTH AUGUSTA, S. C. (3/16/09)--A community used-car lot held weekends at the parking lot of SRP FCU has been closed by the South Carolina Department of Motor Vehicles, which says the sales are affecting vehicle sales of used-car dealers.

However, the case is different from one that occurred earlier in Wisconsin, where auto dealers closed a credit union's auto sales lot (News Now April 10 and Dec. 11, 2008). In this case, the North Augusta, S.C.-based SRP FCU isn't selling or financing the cars. It's just providing a spot for the community to barter.

According to SRP FCU President Ed Templeton, every weekend for years, between 6 p.m. Friday and 8 a.m. Monday, people in the community took their used-cars, boats, motorcycles, travel trailers and more to the credit union's Silver Bluff Road branch parking lot. They slapped a For Sale sign on their vehicle with their contact information.

"It started out with one or two, and over the years, it just grew. We have 75 parking spaces and every weekend, the lot will have 50-75 cars," and other vehicles, Templeton told News Now, noting that the credit union is closed during the weekend. Other branches occasionally get one or two vehicles, but this lot was "a mecca."

Templeton said used-car dealers complained to the DMV that the sales were taking away their business. DMV sent an agent several weekends to the lot to gather tag numbers and vehicle identification numbers, and last weekend the lot was officially closed.

"They told us we were violating the law. The code has benign language about 'affecting the sale of vehicles' in cases where we might lend money to a buyer. The code says we'd need a dealer's license, which we don't want and aren't qualified for under the regulations."

Technically, the DMV is correct, according to the credit union's lawyers. The only recourse is to go to the state legislature to change the code to allow "tent sales." However, that won't happen. "We're not ready to take that on. There is so much going on right now, that we have to pick our battles," Templeton said.

The credit union doesn't conduct the sale, and if a buyer of a car on the lot happens to come into the credit union Monday morning to get financing, the credit union has no way of knowing where the car is purchased, he said.

"It's a disappointment to me, a disappointment to the community. We were the only place available where people could offer their cars. The one beacon was our parking lot." The credit union has signs up on the lot informing sellers and buyers the lot is under police jurisdiction and they could be towed for trespassing. "It's the epitome of stupid," he said, adding that "towing would be a last resort."

People aren't happy about the change, said Templeton. Some members have fired off e-mails to the DMV and a new-car dealer suggested it would help if the credit union wants to change the law. "It's gratifying when people rally around you," he added.

And then, there's the irony: The DMV agent's son complained when he found out he couldn't use the credit union's lot to sell his motorcycle.

courtesy of cuna.org