How Misleading Information Can Get Into Carfax

It can be true but not really reflect the reality of the situation

As we have previously reported, car owners can sometimes be blindsided by information that finds its way into Carfax, long the industry standard for information about individual vehicles.

Some consumers complain the information is wrong. There is an appeals process when that happens. But sometimes the information can be true, but misleading.

Let's take the case of Sheri, of Ladera Ranch, Calif. She says her lease matured this week and rather than turn in the vehicle and pay for excessive mileage, she decided to take the purchase option and then use the leased vehicle on a trade-in.

Bad news

“During the negotiations on the car I intended to purchase I was informed that a current Carfax indicated that my leased car had been in a multiple car accident and as such, the trade-in value was going to be several thousand dollars less than originally quoted,” Sheri wrote in a ConsumerAffairs post.

That was news to Sheri. She had leased the car right out of the showroom and had never been in any accidents. Or so she thought.

"I was rather shocked by this revelation and claimed that I'd never been in a multiple car crash. However, the dealership said they had to abide by the Carfax report. Knowing that I'd never been in an accident," she said.

“I contacted the collision center my husband and I had used over the years and queried them over the report,” Sheri wrote. “They did verify that in December of 2010, they did touch up the front and rear bumpers of my car as they were scratched in a few places; the rear bumper was scratched as the result of a car tapping into me as I sat at a stop sign.”

Why on earth, Sheri asked, would the repair shop report such an insignificant repair to Carfax. They didn't. They only report to insurance companies.

Insurance report

“The insurance company representing the individual who bumped into me paid for the repair to my car and reported this to Carfax,” Sheri wrote.

The slight damage to front and rear bumpers when one vehicle pushed Sheri into another became a “multiple car accident.”

“In my opinion this was a minor event and for there to be a Carfax record which puts forth a report claiming my car was 'involved in a crash and damaged in multiple places' is not only an egregious misrepresentation of the facts, but a damaging report with unwarranted financial repercussions on me as a consumer.”

Sheri's problem is that the Carfax report is technically true, even though it may sound much worse than it actually was. It may be worth her time to contact Carfax and try to change the information. It would probably require an affidavit from the repair shop about the nature of the repairs and even then, she might not be successful.

The lesson is that there may be times that you do not want to file an insurance claim and have information entered into the “permanent record.” In Sheri's case, the cost of paying for the repair herself would likely be much less than the loss in trade-in value of her car.

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