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#304 Used car warranties

mp3 #304 Used Car Warranties, What are Your Rights? (mp3 file)

Under California law, an unwritten implied warranty of fitness is present in most retail sales of both new and used products, including used cars, even when there is no written warranty.

The meaning of the implied warranty of fitness in the sale of a used car will depend upon what the used car's "contract description" was. In determining a used car's "contract description," the car's appearance, price, the seller's conduct and language, any advertising, as well as your actual understanding, will be important. If a used automobile is offered for sale for your personal use, the "contract description" ordinarily will be a car that is fit for the ordinary purpose for which cars are used, I.E., transportation. On the other hand if you buy a car that both you and the seller understand is in need of repair, the implied warranty does not cover those defects.


Since most used car sale contracts contain an "as is" clause, the dealer may argue that you have no rights against him if the car is defective. Although the legal significance of an "as is" disclaimer in California is unclear, courts in other states have refused to give them legal effect in typical used car sales.

One out-of-state court has said flatly that "a general disclaimer clause is not appropriate to a consumer sale." The court declared that an "as is" disclaimer in a used car sale would be legally ineffective unless it were shown that the so-called disclaimer was explicitly negotiated between buyer and seller and that it set forth with particularity the particular qualities of fitness which were being disclaimed.

If the sales person has stated that the car was in "good condition," a good argument can be made that the dealer must live up to its promise. A statement of that kind usually will result in an express warranty. It will also help define the meaning of the implied warranty of fitness in your sale.

In all used car sales, you will be assured of the benefits of an implied warranty if the seller or some other company has furnished a written warranty. Its duration will be the same as the warranty, but not less than 30 days or more than three months. Its duration will be at least 30 days, even if the duration of the written warranty is less.

Remedies in used car sales:

If your car breaks down, and it appears that the problem is a serious one that could affect your decision whether to keep the car, it is important that you have the car inspected and tested (by a mechanic or auto diagnostic clinic) to find out exactly what is wrong with it. Ask for a written report. If the dispute ends up in small claims court, or before an arbitrator, written documents that describe the car's real problem will usually prove invaluable to you.

If the problem is serious, you may want to consider returning the car and cancelling. You will have a basic decision to make: either try to get out of the deal, or keep the car, repair it, and try to recover your losses from the dealer. You can return the car and cancel only if the problem is very serious and you act promptly. But, if you knew of the problem before you purchased the car, you will have to live with it, unless the dealer promised to fix the problem, and didn't.

If you decide to cancel, it is very important that you are aware of and follow exactly, certain very specific cancellation procedures. A dealer will often take some kind of legal action against you. You should consult an attorney to advise you of the appropriate procedures for your case.

Whenever you shop for a used car at a dealer's lot, be sure to read the new buyers guide. The federal trade commission's new used car rule requires that the guide be displayed on a side window of every used car offered for sale.

Be sure to read both sides of the buyers guide--here's why:

-The guide tells you if the dealer is offering a written warranty on the car.

-If no warranty is offered, the guide tells you that the dealer assumes no responsibility for repairs and that you will pay all costs for any needed repairs.

-The guide tells you that the dealer assumes no responsibility for anything that is said about the car, and that since spoken promises are difficult to enforce, the dealer should be asked to put any promises in writing.

-If there's a written warranty, the guide tells you whether it is a full warranty (and therefore satisfies the federal minimum standards for full warranties) or a limited warranty (which may provide virtually any level of protection, depending upon its terms).

-The guide suggests that you ask the dealer for a written copy of the warranty for a full explanation of its coverage. The buyers guide only gives you its highlights.

-It tells you which of the car's systems are covered by the dealer's written warranty and for how long.

-The guide describes the car's 14 major systems and alerts you to some of the major defects which may occur in each system.

-More importantly, the guide suggests that you ask the dealer if you may have the vehicle checked by your own mechanic, either on or off of the lot.

The list of systems and possible defects can be used by you or a mechanic in deciding whether the car is in acceptable mechanical condition-- and is really worth the price that the dealer is asking.

For a copy of the FTC's new used car rule, visit or call toll-free 1-877-FTC-HELP. (1-877-382-4357)

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