Laws on buying and selling a used car

Written by roger thorne
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Laws on buying and selling a used car
Various state and federal laws apply to used car sales. (car and us flag image by Jose from Fotolia.com)

Car buyers face a range of options when considering a used car purchase. Dealers, private sellers and even Internet auto auctions can all be the source for a used car. However, the laws governing used car sales apply no matter who sells the car or how it is sold, though different laws apply to different situations.

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Used Car Dealers

The Federal Trade Commission requires used car dealers, but not private sellers, to include a Buyer's Guide with every car offered for sale. These guides must include specific information such as the warranties offered, the percentage of repair costs covered by the warranty, if the car is being offered "as is," and state that oral promises are difficult to enforce. If the buyer and dealer negotiate terms, the Buyer's Guide must include those new terms, such as changes in warranty protections. If the Guide has conflicting information, such as an express warranty and an "as is" provision, the buyer receives whichever of the two is most beneficial to him.

As Is

Dealers who sell a used car "as is" are not offering any kind of warranty with the car. In those states with lemon laws, used car sales or cars sold "as is" are typically not included under the lemon law protections.

However, some states such as Kansas, Maine, Maryland, and New Jersey prohibit "as is" sales for at least some types of used vehicles. For example, New Jersey requires that any car sold for more than £1,950, with less than 100,000 miles, that is less than eight years old and which has not been declared a total loss cannot be sold "as is" or without a warranty.

Further, dealers and buyers can negotiate terms of the sale even on cars sold "as is," including such terms as no questions asked return policies and three-day return policies.

Private Car Sales

Private car sales--those cars sold by someone who is not a dealer and who is merely selling her own car--are subject to far fewer restrictions than dealer transactions. For example, private car sellers, according to the Federal Trade Commission, are under no duty to provide potential buyers with a Buyer's Guide. Private car deals are always "as is" sales unless the buyer and seller enter into a written contract or the car is still covered by manufacturer's warranties, though these may or may not be transferable between owners.

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