Buying a Used Car
Purchasing a car is a big investment, which is all the more reason to ensure the product you acquire is in good, stable condition. Nothing puts a damper on the car buying experience quite like driving off the lot with a lemon. To avoid such a calamity, it is critical you understand your legal rights as the buyer. Here are a few questions you should ask yourself before putting pen to paper during your next used car purchase:
What determines my legal rights when purchasing a car?
Your legal rights are actually dependent on the seller. For example, car dealerships are required to issue Buyer’s Guides, vehicle history reports, warranties, and other documents to educate you about the pre-owned vehicle of interest. These requirements protect the dealer from any legal action brought forward by the buyer regarding the condition of the used vehicle.
Individual sales are different. The private seller is under no obligation to disclose material defects, so unless you perform your due diligence on the vehicle, you risk driving off in a damaged car without legal recourse. If a private seller knowingly provides you with false information regarding the car’s operative state, you may be in a position to file a lawsuit.
Do warranties offer me consumer protection?
Absolutely. Your level of legal protection is dependent on the type of warranty, however. Common vehicle warranties include “As Is”, specific warranty, and implied warranty. “As Is” offer the least legal protection with implied warranties, full or partial, offering the most.
Be sure to ask the dealer or private seller if the warranty is transferable, too.
I’ve performed my due diligence on the vehicle and am ready to purchase. What are my legal rights when financing a used car?
Again, your rights are dependent on the seller and the financing they allow you to obtain. Cash sales without a formal contract are typical between private sellers and buyers, which limit your ability to recoup any liquid damages down the road. Agreeing to specific financing terms or drafting a contract between yourself and the individual seller provide you more legal ground in the event of discovered damages.
Obtaining an auto loan from a dealer or bank provides you much greater protection as both the lender and borrower (you) must oblige by loan terms. The lender cannot legally apply miscellaneous fees or arbitrary payment increases unless permitted by the loan terms. That said, when applying for financing, be wary of discriminatory acts such as increased interest rates or denied applications based on race, color, religion, sex, and other protected classes under the Equal Credit Opportunity Act.
I have established financing and am ready to complete the car purchase. How do I register the vehicle in my name?
You must register your car with the state to properly transfer ownership. Dealers can walk you through this process, otherwise be sure to consult your state’s Department of Motor Vehicles for rules and regulations in regarding obtaining ownership of a previously owned vehicle.