Before you buy, know your rights and options
Psst. Hey you. Want to buy a used vehicle that you can return for any reason and get your cash back?
Even if it’s just because you don’t like the color?
That may sound like a used-car scam, but it’s not.
It’s the law.
The California Car Buyer’s Bill of Rights, which went into effect in 2006, mandates that car dealers must offer a buyer a two-day return option on most used vehicles.
It’s just one of the legal protections that apply specifically to used-vehicle purchases.
But be warned: All of these protections, including the cancellation option, have loopholes. And most apply only to vehicles bought from dealers, not private parties.
Some parents are fond of proclaiming: “Buying a used car is buying someone else’s troubles.”
By knowing your rights, you can hedge your bets against Dad or Mom saying something even worse: “I told you so.”
Return option
The opportunity to return a used car, even after signing the papers and driving it off the lot, can be a great relief, especially if you buy “as is” and didn’t have the vehicle inspected by a mechanic before purchase.
This choice gives you time to get the vehicle properly checked. And there is a certain comfort in knowing you can return a car if you’re hit with a major case of buyer’s remorse.
But you have to pay for the privilege.
The fee to buy a return option usually depends on the price of the car. Under the law, a dealer can charge a maximum of $75 if the price of the car is $5,000 or less. On the upper end, the fee can be as much as $400 on a $40,000 used car.
Over $40,000 and you’re on your own -- dealers aren’t obligated to offer a return option on a vehicle above that price.
The option fee isn’t returnable. Think of it as similar to buying insurance in Las Vegas if you think the dealer might have blackjack.
To get your refund -- which includes registration costs, taxes and other purchase fees -- the auto must be returned within two days unless the dealer agrees in writing to extend the option period.
Also, it can’t have been driven more than 250 miles (so, no quick trips to Vegas), and it has to be in the same condition in which it left the dealership, minus two days of normal wear and tear.
The dealer can charge a restocking fee, but only up to a set limit. For example, the restock fee for a vehicle priced less than $5,000 can be no higher than $175, and the option fee is deducted from that.
Those fees are not to be sneezed at, but they’re better than being stuck with a lemon.
The option law applies only to used cars, pickup trucks and SUVs bought from dealers. Motorcycles, off-road vehicles and RVs aren’t included.
Buyers guide
Federal law requires that every used vehicle offered by a dealer (in this case, anyone who sells more than five vehicles a year) must have a Buyers Guide posted inside.
It has to include:
* Whether the vehicle is sold “as is” or with a warranty.
* A declaration of what percentage of repair costs a dealer will pay if there is a warranty.
* A reminder that spoken promises are difficult to enforce.
The Buyers Guide becomes part of the sales contract and should reflect any negotiated changes. In case of a conflict, it rules.
An example given on the Federal Trade Commission site: “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.”
Lemon buyback
California’s automobile lemon law is best known for its new-car protections. But there are parts that apply to used autos.
For example, a new vehicle returned to a dealer because it is a lemon can be sold as a used vehicle. But the buyer must be given a written notice that it’s a “lemon law buyback.”
The notice has to list the vehicle’s problems and the work done on it. And the dealer must provide a one-year warranty against these problems.
No fair putting this information in extra-small print. The law specifies it must appear on a white sheet of paper in black type that is at least 10 points in size.
The law further requires that the “lemon car buyback” designation follow the vehicle through all future transfers of ownership.
Think of it as the “scarlet letter” for vehicles.
Original warranty
If you buy a used vehicle that is still under the manufacturer’s original warranty, you’re covered by the lemon law, just as if it were a new vehicle. At least until the original warranty runs out.
Under the lemon law, if a dealer can’t fix a warranty-covered problem, the manufacturer has to exchange or buy back the vehicle.
There is a major loophole, however. If the vehicle was damaged by a previous owner and repaired by an unauthorized shop, a dealer could argue that the warranty is void, said Rosemary Shahan, president of Consumers for Auto Reliability and Safety.
“You take it to the dealer for a repair and they say, ‘Too bad, we can’t warranty parts that aren’t ours,’ ” Shahan said.
It’s another reason to get a vehicle inspected before purchase or during a return option period -- and to know your rights.
“If a used-car purchase goes well, it can mean access to better jobs, more time to spend with your kids,” Shahan said.
“If it goes south, it can ruin your life.”
