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Buying A Used Car from a
licensed Dealer
Used cars are sold
through a variety of outlets: franchised and independent
licensed dealers, rental car companies, leasing companies, and
used car superstores. You can even buy a used car on the
Internet. Ask friends, relatives and co-workers for
recommendations. You may want to call your
local consumer protection agency,
state Attorney General (AG), and the
Better Business Bureau (BBB)
to find out if any
unresolved complaints are on file about a particular
dealer.
Some dealers are attracting customers with "no-haggle
prices," "factory certified" used cars, and better
warranties. Consider the dealer's reputation when you
evaluate these ads.
 Dealers are not required by law to give used car buyers
a three-day right to cancel. The right to return the car
in a few days for a refund exists only if the dealer
grants this privilege to buyers. Dealers may describe
the right to cancel as a "cooling-off" period, a
money-back guarantee, or a "no questions asked" return
policy. Before you purchase from a dealer, ask about the
dealer's return policy, get it in writing and read it
carefully.
The Federal Trade
Commission's (FTC) Used Car Rule requires dealers to
post a
Buyers Guide in every
used car they offer for sale. This includes light-duty
vans, light-duty trucks, demonstrators, and program
cars. Demonstrators are new cars that have not been
owned, leased, or used as rentals, but have been driven
by dealer staff. Program cars are low-mileage,
current-model-year vehicles returned from short-term
leases or rentals. Buyers Guides do not have to be
posted on motorcycles and most recreational vehicles.
Anyone who sells less than six cars a year doesn't have
to post a Buyers Guide.
The
Buyers Guide must
tell you:
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whether the vehicle is
being sold "as is" or with a warranty;
-
what percentage of the
repair costs a dealer will pay under the warranty;
-
that spoken promises are
difficult to enforce;
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to get all promises in
writing;
-
to keep the Buyers Guide
for reference after the sale;
-
the major mechanical and
electrical systems on the car, including some of the
major problems you should look out for; and
-
to ask to have the car
inspected by an independent mechanic before you buy.
When you buy a used car
from a dealer, get the original
Buyers Guide that was
posted in the vehicle, or a copy. The Guide must reflect
any negotiated changes in warranty coverage. It also
becomes part of your sales contract and overrides any
contrary provisions. For example, if the Buyers Guide
says the car comes with a warranty and the contract says
the car is sold "as is," the dealer must give you the
warranty described in the Guide.
Spoken Promises
The
Buyers Guide cautions
you not to rely on spoken promises. They are difficult
to enforce because there may not be any way for a court
to determine with any confidence what was said. Get all
promises written into the Guide.
Pre-Purchase Independent Inspection
It's best to have any used car inspected by an
independent mechanic before you buy it. For about $100
or less, you'll get a general indication of the
mechanical condition of the vehicle. An inspection is a
good idea even if the car has been "certified" and
inspected by the dealer and is being sold with a
warranty or service contract. A mechanical inspection is
different from a safety inspection. Safety inspections
usually focus on conditions that make a car unsafe to
drive. They are not designed to determine the overall
reliability or mechanical condition of a vehicle.
To find a pre-purchase
inspection facility, check your Yellow Pages under
"Automotive Diagnostic Service" or ask friends,
relatives and co-workers for referrals. Look for
facilities that display certifications like an
Automotive Service Excellence (ASE)
seal. Certification
indicates that some or all of the technicians meet basic
standards of knowledge and competence in specific
technical areas. Make sure the certifications are
current, but remember that certification alone is no
guarantee of good or honest work. Also ask to see
current licenses if state or local law requires such
facilities to be licensed or registered. Check with your
state Attorney General's office or
local consumer protection agency
to find out whether
there's a record of complaints about particular
facilities.
There are no standard operating procedures for
pre-purchase inspections. Ask what the inspection
includes, how long it takes, and the price. Get this
information in writing.
If the dealer won't let you take the car off the lot,
perhaps because of insurance restrictions, you may be
able to find a mobile inspection service that will go to
the dealer. If that's not an option, ask the dealer to
have the car inspected at a facility you designate. You
will have to pay the inspection fee.
Once the vehicle has been inspected, ask the mechanic
for a written report with a cost estimate for all
necessary repairs. Be sure the report includes the
vehicle's make, model and VIN. Make sure you understand
every item. If you decide to make a purchase offer to
the dealer after considering the inspection's results,
you can use the estimated repair costs to negotiate the
price of the vehicle.
Vehicle Systems
The Buyers Guide lists an auto's 14 major systems and
some serious problems that may occur in each. This list
may help you and your mechanic evaluate the mechanical
condition of the vehicle. The list also may help you
compare warranties offered on different cars or by
different dealers.
Dealer Identification and
Consumer Complaint Information
The back of the Buyers Guide lists the name and address
of the dealership. It also gives the name and telephone
number of the person you should contact at the
dealership if you have problems or complaints after the
sale.
Optional Signature Line
The dealer may include a
buyer's signature line at the bottom of the
Buyers Guide. If the
line is included, the following statement must be
written or printed close to it: "I hereby acknowledge
receipt of the Buyers Guide at the closing of this
sale." Your signature means you received the Buyers
Guide at closing. It does not mean that the dealer
complied with the Rule's other requirements, such as
posting a Buyers Guide in all the vehicles offered for
sale.
Spanish Language Sales
If you buy a used car and the sales discussion is
conducted in Spanish, you are entitled to see and keep a
Spanish-language version of the Buyers Guide.
If You Have Problems
If you have a problem that you think is covered by a
warranty or service contract, follow the instructions to
get service. If a dispute arises, there are several
steps you can take:
-
Try to work it out with
the dealer. Talk with the salesperson or, if
necessary, the owner of the dealership. Many
problems can be resolved at this level. However, if
you believe you're entitled to service, but the
dealer disagrees, you can take other steps.
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If your warranty is
backed by a car manufacturer, contact the local
representative of the manufacturer. The local or
zone representative is authorized to adjust and
decide about warranty service and repairs to satisfy
customers. Some manufacturers also are willing to
repair certain problems in specific models for free,
even if the manufacturer's warranty does not cover
the problem. Ask the manufacturer's zone
representative or the service department of a
franchised dealership that sells your car model
whether there is such a policy.
-
Contact your local
Better Business Bureau,
state Attorney General, or the Department of Motor
Vehicles. You also might consider using a dispute
resolution organization to arbitrate your
disagreement if you and the dealer are willing.
Under the terms of many warranties, this may be a
required first step before you can sue the dealer or
manufacturer. Check your warranty to see if this is
the case. If you bought your car from a franchised
dealer, you may be able to seek mediation through
the Automotive Consumer Action Program (AUTOCAP), a
dispute resolution program coordinated nationally by
the National Automobile Dealers Association and
sponsored through state and local dealer
associations in many cities. Check with the dealer
association in your area to see if they operate a
mediation program.
-
If none of these steps
is successful, small claims court is an option.
Here, you can resolve disputes involving small
amounts of money, often without an attorney. The
clerk of your local small claims court can tell you
how to file a suit and what the dollar limit is in
your state.
-
The Magnuson-Moss
Warranty Act also may be helpful. Under this federal
law, you can sue based on breach of express
warranties, implied warranties, or a service
contract. If successful, consumers can recover
reasonable attorneys' fees and other court costs. A
lawyer can advise you if this law applies.
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