‘Keep paying the loan,’ experts urge, as Tricolor Auto dealership files for bankruptcy

HOUSTON, Texas (KTRK) — From cars locked behind chains and padlocks to empty lots, Tricolor Auto Group customers tell ABC13 that is what they’ve found in the past two weeks.

Nearly two weeks ago, used car retailer Tricolor Auto filed for bankruptcy. ABC13 then learned that one of its lenders is investigating the company for fraud.

READ MORE: Lender accuses Tricolor dealership of fraud after company locks their doors and files for bankruptcy

Tricolor operated six locations in Houston, and today, customers say they still have few answers.

Empty car lots, lights off, and two weeks of little to no communication greet customers with questions on what’s next as Tricolor deals with the bankruptcy of their company.

Christopher Pickens and his family said they traded in their old car and bought their new vehicle from Tricolor last month.

“The vehicle we traded in — when is that going to be paid for, because that’s damaging my credit,” Pickens said. “I’m very angry.”

Court records confirm Tricolor has more than a billion dollars in liabilities and between one and $10 billion in assets as it filed for Chapter 7 bankruptcy.

The Tricolor location off 59 near Chimney Rock is now non-existent. Just 10 days since our last story, a sign is now posted for lease on their gate.

“Why should I have to pay for a vehicle that, if they’re going to breach the contract and not contact anybody and leave everybody high and dry, why should we have to do the same?” Pickens said.

Automotive expert Brian Moody says it’s important not to miss your payments even if the dealership has gone bankrupt.

“No matter what anybody says — you should keep paying the loan, and here’s why. If you got a car from one of these dealerships — Tricolor being one of them — your loan is not with a dealership. Most likely, it’s with a financial institution,” Moody said.

Moody says it’s extremely important for all customers to keep their paperwork because it’s binding whether or not the dealership is in business.

“If you know you’re still getting a bill from your old car that you traded in, you need to call the lender right away and show them the paperwork and tell them what’s happened,” Moody said.

He also recommends getting legal help.

As for Tricolor Auto, their website confirms they’re no longer offering financing or sales, but urges customers to keep making their usual payments.

The Texas Department of Motor Vehicles is currently investigating 157 complaints related to Tricolor Auto.

“Buyers experiencing issues with a Texas dealer can file a complaint with TxDMV at www.TxDMV.gov/complaints. The department investigates all complaints and works directly with dealers to resolve deficiencies and help expedite the release of titles. Regarding your question about loans, motor vehicle financing is regulated by the Texas Office of Consumer Credit Commissioner (OCCC). Consumers with questions or concerns related to financing can submit complaints to the OCCC,” a representative from Texas DMV said.

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