Profeco Advises on Safe Auto-Financing for Homes and Cars
The Procuraduría Federal del Consumidor (Profeco) is actively informing consumers about the necessary precautions to take when considering auto-financing options for acquiring a home or a vehicle. In a recent statement, Profeco is emphasizing the importance of verifying the registration status of providers’ adhesion contracts to protect consumers from potential fraud and ensure their rights are upheld.
Ensuring Provider Reliability
According to Profeco, consumers are strongly encouraged to check the official Profeco website to confirm whether the auto-financing provider meets several critical criteria. This verification process is instrumental in determining if the provider:
- Has a registered adhesion contract with Profeco.
- Complies with current regulations.
- Does not include abusive or unfair clauses in their contracts that could potentially violate consumer rights.
Nilsa Hernández (2024), writing for Grupo Milenio, quotes Profeco as stating, «Acquiring a house or a car is an important decision, and auto-financing is an option for the acquisition of those goods. This method is a system of commercialization of goods and services that consists of forming a group of people who periodically contribute sums of money to a common fund that is administered by a third party.»
Understanding Auto-Financing
Auto-financing works by pooling funds from a group of people who make regular contributions. These funds are managed by a third party and used to enable members to acquire assets like homes or cars. Unlike traditional loans, auto-financing does not involve direct lending from the provider. The Secretaría de Economía (SE) requires that providers offering auto-financing services have proper authorization, ensuring they operate within legal parameters.
Methods of Adjudication
There are several methods by which individuals can be granted auto-financing:
- Liquidation: Paying off the total amount owed.
- Lottery: Random selection through a draw.
- Seniority: Based on how long the individual has been part of the group.
- Auction: Bidding for the available funds.
- Score or Percentage: Based on a scoring system defined in the contract.
- Authorized Procedure: As specified in the adhesion contract.
Avoiding Fraudulent Schemes
To avoid falling victim to fraud, Profeco is advising consumers to take the following precautions before signing any auto-financing contract:
Verification of Authorization
Ensure that the provider has the necessary authorization from the Secretaría de Economía. This confirms that the provider is legally permitted to offer auto-financing services.
Group and Payment Details
Know the total number of people in the auto-financing group, the order of your turn, the number of installments required, and the specific details of the asset you intend to acquire.
Adjudication and Delivery
Understand how often adjudication events occur, the method of delivery, the means, and the periodicity of acquiring the asset.
Contract Terms and Conditions
Carefully review potential causes for contract cancellation, penalties for non-compliance, the types of insurance offered, the coverage included, and the delivery date of the policy.
Contract Cancellation
Profeco reminds consumers that they have the right to cancel or revoke an adhesion contract for auto-financing within five business days following the signing of the document. To do so, the consumer must notify the provider in writing, via email, or through a verifiable method of their intention to discontinue the service.
Contact Information
For more information, interested parties can contact Profeco via email at contratosenlinea@profeco.gob.mx or contratosdeadhesion@profeco.gob.mx.
By following these guidelines, consumers can make informed decisions and protect themselves from potential risks associated with auto-financing, ensuring a safer path to acquiring their desired home or vehicle.
