USAgencies

You’ve probably heard the old saying “buyer beware”, but when it comes to buying a used car it’s especially true. After all, you can never be quite sure what you’re going to get or get stuck with. For that reason, as a potential buyer of a used car, you should have a basic knowledge of certain facts that can save you money and a headache.

It’s usually a good idea to do some research on your main choice of vehicle, if you have a particular make and model in mind. Be familiar with available options, reliability, safety tests, and miles per gallon.

Your needs and budget should be a top priority. In other words, don’t cast your eye on a two-door sporty coupe, if a four-door or minivan better suits your family. The same applies to falling head over heels for a flashy vehicle that far exceeds your budget and will undoubtedly make the monthly payments a financial burden.

Your Payment Options

Before you start, know exactly how much you can realistically afford. You can either pay for the car in full or finance it over time. Because most people don’t have the cash to buy a reasonably expensive used car outright, most choose to finance. If you choose the latter, remember – the longer the term of the loan, the more the total cost of the vehicle will be, due to the accumulation of monthly interest charges and other costs associated with the loan.

According to the Louisiana Used Motor Vehicle Commission, when financing a vehicle, make sure you have a clear understanding of the various aspects of the loan agreement ahead of signing any purchase documents. These include:

• The exact price you’re paying for the vehicle;
• The total amount you’re financing (after down payment, if applicable);
• The finance charge (the dollar amount the credit will cost you per the APR);
• The APR (a yearly percentage rate used to measure the cost of credit);
• The number and amount of payments (36, 60, 72 monthly payments); and
• The total sales price (the sum of the monthly payments plus the down payment).

Buying from a Dealership

Knowing a dealer’s reputation, including any unresolved complaints on file or repeated violations can prove valuable. You can obtain information from the state Attorney General (AG) as well as the Better Business Bureau (BBB) or your local consumer protection agency.

While some dealers offer a buyer the right to cancel, often called a “cooling-off” period, with a money-back guarantee or a “no questions asked” return policy as an enticement, one important thing to keep in mind is – dealers are by no means required by state law to give used car buyers a three-day right to cancel. In fact, the right to return a car or truck in a few days for a refund will only take place if specifically expressed in writing by the dealers to their buyers.

Furthermore, the Federal Trade Commission’s (FTC) Used Car Rule requires dealers to post what is known as a “Buyers Guide” in all used cars for sale on their lot. The Buyers Guide must clearly tell you:

• If the vehicle is being sold “as is” or with a warranty;
• The percentage of the repair costs the dealer will pay under the warranty;
• That spoken promises are difficult to enforce;
• That all promises should be obtained in writing;
• That the Buyers Guide should be kept 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 purchase

Unexpired Manufacturer’s Warranties
In some cases, the original manufacturer’s warranty may still be in effect if the vehicle has low miles and is only a couple of years old. Therefore, the dealer may choose to include it as part of the “systems covered/duration” section of the Buyers Guide. As the new buyer of the vehicle, be sure to ask the dealer for the vehicle’s warranty documents.

Buying from a Private Party

Unlike buying a vehicle from a dealer, which is regulated by the state of Louisiana, buying from a private individual is much different.

• First, they are not covered by the Used Car Rule nor are they required to use the Buyer’s Guide. For this reason, ask the seller permission to have the vehicle inspected by your own mechanic.
• In addition, private party sales are typically on an “as is” basis, unless the seller states otherwise in the purchase agreement. While the vehicle may be covered by a manufacturer’s warranty or a separately purchased service contract, be aware these may not be transferable to the new owner.

Finally, inspect the car inside and out and take it to a mechanic you trust and hire yourself. After that, the choice to go ahead with the purchase is yours.

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