App claims to reveal secret prices used car dealers pay for vehicles

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If you knew what a used car dealer paid for a car that you’re interested in, wouldn’t that give you a tactical advantage when negotiating a deal?

Of course it would.

Now one self-described used car dealer, who goes by the nom-de-guerre of Dennis Miller, is letting consumers in on the big secret.

Miller and his colleagues have launched a new app called SnafuScan that gives prospective buyers information they say has never before been available to the general public, and could help them win the battle of the bargain.

“This is an app that gives you the prices that dealers pay for cars at dealers’ auctions,” Miller, founder and CEO of SnafuScan.com tells FoxNews.com. “The auction price is much lower than the Kelly Blue Book price, which reports on the prices of cars as sold to the public. Consumers have been very much keyed in to the Kelly Blue Book for years.”

According to Miller, most of the used cars at dealerships are bought at special dealer-only auctions closed to the general public, not directly from consumers, and the prices paid can be $5,000-$10,000 less than what’s on the window when you kick the tires.

Miller is not giving this information away for altruistic reasons. He is, after all, still a used car dealer, and wants to sell you his app for $9.99 for a 30-day subscription.

As a spiff to get customers in the digital door, he’s offering a free version of the app that allows users to get all the details on safety recalls for a particular car. The information will enable consumers to check the VIN number of a vehicle and find out if there is any outstanding work that needs to be done.

“We’re hoping to get the word out about recalls, and generate attention to our site as a resource for automotive information,” says Miller. “If millions of people use this as a recall scanner for their current cars, when they want to buy a new car, they will know about us, and can spend the $9.99 to get more detailed information about other cars.”

The free application idea came to Miller first, inspiring him and his investors to take the product to a higher level of design and functionality.

“When we buy a used car at an auction, we always look up recall information, so the cars can be upgraded, for free,” says Miller. “Some are benign, some are serious, like a faulty gas pedal or airbags. We want to prep the car and get rid of it as soon as possible.”

Most used cars, he explains, are bought by the dealer on credit, and it could cost them $200 or more every month the car sits on the lot, so they want to move the metal quickly.

The pricing info provided by SnafuScan will come in most handy for consumers if the car has been on the lot for more than 30 days, when the dealer’s profit margin really starts narrowing and he’s ready to deal.

Working with computer software developers in Russia and the Ukraine, Miller has come up with an algorithm that takes the last five years of transaction data from used car auctions, crunches the numbers, and comes up with the probable price the dealer paid for a particular used car, “within a few hundred dollars over, or under.”

Miller says that less reputable used car dealers in the past have gone as far as forging receipts from auctions to show to prospective buyers, claiming that their margin of profit on the car was less than it actually was.

“Let’s say we buy a vehicle for $6,500,” Miller says. “The industry has made up receipts that look like auction receipts, but which say the car cost $10,200 at auction. Meantime, Kelly Blue Booksays the car is worth $12,000. So you can see there is a lot of room for negotiation there.”

But what do Miller’s colleagues think about his turncoat move?

When contacted by FoxNews.com, the National Independent Automobile Dealers Association, which represents many of the nation’s used car dealers, had no comment.

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EPA to unveil plan to clean up tailpipe pollution that critics say would raise gas prices

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The White House is planning to unveil a proposal by the Environmental Protection Agency that aims to clean up gasoline and automobile emissions, a plan officials say will lead to cleaner air but also higher gas prices.

The so-called Tier 3 standards would reduce sulfur in gasoline by more than 60 percent and reduce nitrogen oxides by 80 percent, by expanding across the country a standard already in place in California. It would go into effect in 2017.

The oil industry, Republicans and some Democrats have pressed the EPA to delay the rule, saying it would be unwise to impose such a standard while many are still struggling in a bad economy. An oil industry study says the rule could increase gasoline prices by 6 to 9 cents per gallon.

The EPA says the potential increase in gas prices would be slight, estimating the rules could increase gas prices by less than a penny per gallon and add $130 to the cost of a vehicle in 2025. Additionally, the agency argues the plan will yield billions of dollars in health benefits by slashing smog- and soot-forming pollution come 2030.

For states, the regulation will make it easier to comply with health-based standards for the main ingredient in smog and soot. For auto makers, the regulation allows them to sell the same autos in all 50 states.

Environmentalists hailed the proposal as potentially the most significant in President Obama's second term.

The Obama administration has already moved to clean up motor vehicles by adopting rules that will double fuel efficiency and putting in place the first-ever standards to reduce the pollution blamed for global warming from cars and trucks.

"We know of no other air pollution control strategy that can achieve such substantial, cost-effective and immediate emission reductions," said Bill Becker, executive director of the National Association of Clean Air Agencies. Becker said the rule would reduce pollution equal to taking 33 million cars off the road.

But the head of American Fuel and Petrochemical Manufacturers, Charles Drevna, said in an interview Thursday that the refiners' group was still unclear on the motives behind the agency's regulation, since refining companies have already spent $10 billion to reduce sulfur by 90 percent. The additional cuts, while smaller, will cost just as much, Drevna said, and the energy needed for the additional refining could actually increase carbon pollution by 1 to 2 percent.

"I haven't seen an EPA rule on fuels that has come out since 1995 that hasn't said it would cost only a penny or two more," Drevna said.

A study commissioned by the American Petroleum Institute estimated that lowering the sulfur in gasoline would add 6 to 9 cents per gallon to refiners' manufacturing costs, an increase that would likely be passed down to consumers at the pump. The EPA estimate of less than 1 cent is also an additional manufacturing cost and likely to be passed on.

A senior administration official said Thursday that only 16 of 111 refineries would need to invest in major equipment to meet the new standards, which could be final by the end of this year. Of the remaining refineries, 29 already are meeting the standards because they are selling cleaner fuel in California or other countries, and 66 would have to make modifications.

The official spoke on condition of anonymity because the rule was still undergoing White House budget office review.

The Associated Press contributed to this report.

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Homes damaged by Superstorm Sandy hit the market for bargain prices

LONG BEACH, N.Y. –  It sounds like the premise for a new reality TV series: "Hurricane House" — people scouring waterside communities looking to buy homes damaged by Superstorm Sandy at a deep discount.

While there are bargains out there, ranging from 10 percent off pre-storm prices for upscale homes on New York's Long Island and the Jersey Shore to as much as 60 percent off modest bungalows Staten Island and Queens, it's still very much a game of buyer beware.

Not only are buyers are on the hook for repairs and in some cases total rebuilds, they're also wading into a host of potentially expensive uncertainties about new flood maps and future insurance rates, zoning changes and updated building codes.

"It's totally changed the way I sell real estate," said Lawrence Greenberg, a sales associate with Van Skiver Realtors, whose own Mantoloking, N.J., office was wrecked in the storm.

Prior to Sandy, prospective buyers rarely mentioned issues such as flood maps and building elevations until the matter of flood insurance came up — often at closing. "Now, everybody asks the question of elevation," Greenberg said. Even if potential buyers plan to tear down and build new, they ask about the pending changes in flood maps proposed by the Federal Emergency Management Agency, because flood insurance rates will depend upon the new zones.

There is no sign of a mass exodus from shoreline communities. The number of for-sale listings in January in the 380 zip codes hit by the storm was about 2 percent below the same time last year, according to online real estate information company Zillow Inc. That indicates that most homeowners are rebuilding, or have not yet decided how to proceed.

But real estate agents in New York and New Jersey say the majority of homes for sale in these areas have some damage from the Oct. 29 storm, and it appears to them that a rising number are being put on the market as the spring home-buying season approaches.

New listings range from destroyed oceanfront properties being sold for the land, to flooded bayside homes untouched since the storm that must be gutted. Even the few undamaged homes in affected neighborhoods are listing at prices about 10 percent lower than they would have been pre-storm.

Some sellers are overwhelmed by the daunting prospect of restoring a damaged home. Some are older homeowners who had stayed in the houses where they raised their families, but now are relocating. Some didn't have flood insurance.

"They either don't have the funds or don't have the energy to go through the renovating and rebuilding process," said Jeff Childers, a broker with Childers Sotheby's International Realty in Normandy Beach, N.J.

Lisa Jackson, broker and owner of Rockaway Properties in the Belle Harbor section of Queens, N.Y., said a number of her new listings are homes owned by senior citizens. One 85-year-old client was living alone in her 1940s-era six-bedroom, six-bath brick home right on the beach. The house was hammered by Sandy, and must be at least partially demolished, but will still command a hefty price. "Everything on the water is big money," Jackson said.

But the $3 million listing price is nevertheless a huge discount from the roughly $4.25 million it would have commanded before the storm.

Another set of sellers were in the process of getting out before the storm hit. Jackson had 18 properties in contract prior to Sandy, but all of those sales either fell through or were renegotiated for a lower price.

One 1930s-era three-bedroom, two-bath house with a view of the bay was in contract for $665,000, but the entire first floor was gutted after it took on about four feet of water. The buyer, a single woman, was unwilling to take on the renovations. The property is back on the market for $550,000. That's a 17 percent discount, but the eventual buyer will have to pay for new floors and walls, plus a new kitchen and bathroom.

Still, that sort of cut might make the neighborhood affordable for a family that was priced out in recent years, when houses were selling for $750,000 and more.

And in one sense, buying a storm-damaged home can offer an advantage, said Tom Tripodi, president of the Tripodi Group/ Douglas Elliman Real Estate in the Long Island city of Long Beach, where damaged houses are selling for about 10 percent less than before the storm.

"If it's all gutted out, you can do what you want," he said. "You can own the house with a brand new kitchen, new appliances, new floors."

In addition to people looking to create their dream house out of a damaged home, Tripodi has seen investors eyeing the area. In Long Beach's West End neighborhood, for example, investors are looking to tear down gutted 1920s-era ranch homes and build bigger houses with multiple stories at higher elevations in their place.

The shorefront sections of Staten Island are also seeing accelerating turnover of homes that are likely to eventually get torn down.

Lee Venezia, a broker with Neuhaus Realty Inc., recently sold three adjacent bungalows owned by a longtime resident of Staten Island's Midland Beach for $240,000 cash — about $20,000 less than each one might have garnered before the storm. "The homeowner refused to go back," she said.

The buyer will fix the properties up and rent them "until the dust settles," Venezia said. Once new flood maps are finalized and new building codes sorted out, she expects the houses to be sold again to a developer who will replace them.

Cash deals are the only ones closing right now in Staten Island's storm-damaged neighborhoods, Venezia said, which means the buyers are almost all investors, even though the area's small houses are selling for $85,000 to $100,000. "Banks are not going to lend," she said. "The banks are waiting for the dust to settle to see what the building requirements are going to be."

The new flood maps must go through public hearings before they are finalized, a process likely to take two to three years.

Meanwhile, public officials and homeowners are trying to look to the future.

New York Gov. Andrew Cuomo recently announced a plan to buy out the entire Staten Island neighborhood of Oakwood Beach and allow the land to revert back to the marshland it once was, because the homes there have flooded multiple times. It remains unclear if any other neighborhoods might get bought out.

That may be the best hope for homeowners like Michael Kuhens, who has been trying to sell his bungalow in Staten Island's Ocean Breeze section, which was ripped off its foundation by the 14-foot storm surge.

A buyout would be attractive because, instead of dealing with bargain hunters, the state is offering pre-storm value.

"I know a lot of people in my neighborhood don't want to stay, and if they were offered a buyout they'd take it," said Kuhens, who is staying at his parents' house with his wife and 1-year-old daughter. "We just want to get on with our lives. It's a hundred-something days after the storm, and we're still stuck in limbo."

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