Buying and Maintaining a Car

Buying and Maintaining a Car

Buying a car – whether new or used – is one of the biggest purchases we make. It is important to take your time in deciding which car to buy and not be pressured by anyone who simply wants your money or your signature on a contract. Once you decide on the vehicle that best fits your needs and budget, shop around for the best price, know the vehicle’s history (if used), and be prepared to walk away from the deal if your questions are not being answered. Before you buy or lease a vehicle:

  • Know the value of the vehicle by checking vehicle pricing guides, newspaper ads, the Internet, or by comparison shopping. Popular publications include the National Automobile Dealers Association's (NADA) Guides, Edmunds, Kelley Blue Book, and Consumer Reports. Some may charge for this information.
  • Always read and understand your purchase contract. Carefully review the vehicle’s price, fees, and finance charges. Don't sign anything you don't understand.
  • Make sure you understand the manufacturer's warranty or any extended warranties offered by the dealer at extra cost. Because the cost of an extended warranty can be expensive, you should find out what it covers before you buy it.
  • When getting a loan, compare interest rates. You may pay more money when a dealer obtains a loan on your behalf than if you go directly to a bank or lender.
  • Protect yourself from fraud and unsafe used vehicles. The National Motor Vehicle Title Information System (NMVTIS) provides important information about a used vehicle's history. You can obtain a NMVTIS report at www.vehiclehistory.gov. Licensed dealers selling used cars must have a NMVTIS report to show you.
  • Understand the restrictions when buying an out of state vehicle: the car must be certified to meet California smog laws to be registered in California. See Buying an Out of State Vehicle on the California DMV website.
  • Find out if a vehicle has a safety recall notice and whether it has been repaired by checking the National Highway Traffic Safety Administration and Center for Auto Safety websites.

Car Buyer's Bill of Rights

The Car Buyer's Bill of Rights gives you certain protections when you buy a new or used vehicle from a licensed California dealer:

  • Buyer Disclosures. No charges may be added to your contract without full disclosure and your consent. Dealers must give you an itemized price list for optional “add-on” items such as service contracts, insurance, anti-theft devices, or other products.
  • Credit Score Disclosures. If you are obtaining financing from the dealer, the dealer must provide you with your credit score and a written explanation of how it is used.
  • Limit on Markups. When a dealer obtains financing on your behalf, it sometimes adds a hidden markup to increase the interest rate on your loan. The law caps the amount of compensation a dealer can receive from the lender.
  • Certified Used Cars. Used cars advertised as “certified” must meet specific requirements. Dealers must perform a complete vehicle inspection and give you a copy of the inspection report.
  • Right to Cancel Used Car Purchase. When buying a used car or vehicle, you have the right to buy a two-day cancellation option (there are certain limited exceptions to this right). A cancellation option allows you to test drive the vehicle or have it checked out by a mechanic, with the right to a full refund within two days – for any reason. Dealers can charge you a nonrefundable fee for the contract cancellation option. If you are buying a motorcycle, off-highway vehicle, or higher priced used vehicle this cancellation option may not apply.

For more information about the Car Buyer’s Bill of Rights, visit the DMV website.

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My Car Is Broken and I Need Help!

Motor Vehicle Warranties and Service Contracts

Most new vehicles come with an express manufacturer’s warranty that gives you certain rights if the vehicle does not perform as promised. These warranties are included in the price of your new car. Car dealers may also sell service contracts—sometimes called extended warranties—for both new and used vehicles. Some service contracts offer good protection at a reasonable price, while others have exclusions that make them almost worthless. Because warranty law is complex, you should consult with a lawyer or other expert who can best advise you of your rights under the particular circumstances of your case. For more information about vehicle warranties and service contracts check out the California Department of Insurance’s “Guide to Automobile Service Contracts.”

California Lemon Law

The California Lemon Law (Civ. Code, § 1793.22) protects you when your vehicle is defective and cannot be repaired after a “reasonable” number of attempts. In such instances, the manufacturer must either replace or repurchase the vehicle—whichever you prefer.

  • The Lemon Law applies to most vehicles purchased or leased in California that are still under a manufacturer’s new car warranty. Members of the Armed Forces, who are stationed in or are residents of California, are protected by the Lemon Law even if their vehicles were purchased or registered outside of California.
  • The Lemon Law also applies to used vehicles when they are still under a manufacturer’s new car warranty. Any remaining time left on the warranty protects the car’s new owner.
  • Lemon vehicles that are bought back by dealers and then resold must be identified as a “lemon law buyback” and have a “lemon” sticker on their door. When lemon buybacks are not properly disclosed and sold “as is,” the buyer may still have rights under the Lemon Law. For additional information, see Lemon Law Buyback Vehicles.

There are certain guidelines for determining when a “reasonable” number of repair attempts have been made before you may be entitled to a refund or replacement vehicle. For additional information, see the Department of Consumer Affairs publication entitled Lemon-aid for Consumers.

Even when the Lemon Law does not apply in your case, other state and federal laws may protect you. These include laws that prohibit deceptive practices and require vehicles to meet minimum safety standards. For complete advice concerning your legal rights, you should consult your own attorney.

Auto Repair Shops

All auto repair shops must be registered with the California Bureau of Automotive Repair (CBAR). To check if a repair shop is registered or if there has been any disciplinary action taken against it visit the CBAR website or contact them at (800) 952-5210.

By law, a vehicle repair shop must give you a written estimate before it makes any repairs. The repair shop cannot charge you more than the estimate without your permission. Ask if there is a charge for the estimate. After you receive the estimate, feel free to go to another shop for a second opinion.

To report a problem you are having with your repair shop or to file an online complaint, visit the California Bureau of Automotive Repair. CBAR will investigate your complaint and may be able to help you by negotiating with the repair shop on your behalf.

For additional information about auto repair shops and your rights check out "A Consumer's Guide to Auto Repair".

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Dispute with Your Car Dealer?

Filing a Report or Complaint about a Car Dealer

The Department of Motor Vehicles (DMV) licenses and regulates new and used motor vehicle dealers. If you would like to report a problem or dispute you have with a motor vehicle dealer, contact the DMV, Division of Investigations, or file a complaint online. DMV Record of Complaint Form.

New Motor Vehicle Board Mediation Program

The New Motor Vehicle Board has an informal mediation program to help you resolve disputes with new motor vehicle dealers. If you have a contractual dispute (purchase or lease) or a warranty/repair dispute, contact the Consumer Mediation Services Program for assistance.

Arbitration Program for Lemon Law Disputes

In California, many vehicle manufacturers offer a state-certified arbitration program to resolve any warranty problems that you may have. Arbitration is a free and relatively simple way of resolving disputes. Both you and the manufacturer agree to allow a neutral third party, called an arbitrator, to decide whether a reasonable number of repair attempts have been made and what relief will be ordered. For more information about the Arbitration Certification Program and your rights, contact the California Department of Consumer Affairs or call them at 800-952-5210. Because not all vehicle manufacturers use this state-certified arbitration process, you may also want to try mediation through the New Motor Vehicle Board.

BBB Lemon Law Dispute Resolution Program

Many consumers feel it is worthwhile to contact their local Better Business Bureau (BBB) to register complaints about area businesses. The Better Business Bureau also provides a Lemon Law Dispute Resolution Program that covers car warranty issues with participating manufacturers.

California Department of Insurance

If you have questions about vehicle service contracts, or have a dispute about getting a refund for your cancelled service contract, visit the California Department of Insurance or call their Consumer hotline at 1-800-927-HELP (4357).

Consumer Motor Vehicle Recovery Corporation - Recovery Fund

Has the dealership where you purchased or leased your vehicle gone out of business and failed to honor the terms of your contract? The Consumer Motor Vehicle Recovery Corporation (CMVRC) has a Consumer Recovery Fund to help consumers when a licensed dealer files for bankruptcy or goes out of business. If the CMVRC approves your claim, you may be entitled to reimbursement for any economic losses that resulted from the dealer’s failure to honor the terms of your sales contract. For more information or to file a claim, visit the CMVRC or call them at 800-961-6175.

Vehicle Recall and Safety Issues

The National Highway Traffic Safety Administration (NHTSA) provides information about vehicle safety issues and any recall information about your vehicle. It also provides extensive information about child safety seats including ratings, recalls and correct use. For more information, visit the NHTSA or call its Auto Safety Hotline 1-888-327-4236.

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