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How to Buy a Used Car Without Losing Your Shirt by Fraser Wheelock http://www.fwcar.com In 1975, the federal government enacted the Magnuson-Moss Warranty Act. Widely known as the 'Lemon Law', it provided protections and assurances to consumers for purchases that cost over $25, and came with express or implied warranties. In the time since, every one of the fifty states has added its own set of lemon laws to their state books. In many cases, the sale of used cars is specifically regulated. While the law in each state differs slightly from the original, they all lay out which disclosures must be made by the seller before a sale, and what warranties must be honored when a sale is made. Once Magnuson-Moss was on the books, many states followed suit with so-called lemon laws of their own to make the prospect of purchasing a used car safer for consumers. The Lemon Laws lay out exactly what kind of information must be made available to consumers considering any purchase, including the warranties and guarantees that they will receive. The specifics vary from state to state, so it is in your best interest to look up the lemon laws in your state before signing any agreement to purchase a used car. Another thing that you should know when considering a used car purchase is the payment options available to you. The basics are simple: are you paying the full price for the car on purchase, or will you finance all or part of it? Paying in Full In this case, paying cash for your car includes the option of taking out a personal or car loan with your own bank in order to pay the dealer off for your car all at once. To the dealer, it's the same as being paid in cash, and you may be able to use it as leverage to get a better price on the car of your choice. 3. Read the Buyers' Guide for the car you are buying. Used car dealers ARE required by law to post a Buyer's Guide in each vehicle that they offer for sale. The Buyer's guide must make certain disclosures and make some specific statements. Among those statements and disclosures are: Most dealers arrange financing through a bank or finance company. Since the vehicle serves as collateral, a car loan acquired that way is often easier to get than one through a conventional bank. If your credit is impeccable, though, arranging your own financing as above could save you money in the long run. Private sellers do not need to post a Buyers Guide, nor do dealers who sell less than six cars per year. The Buyers Guide should tell you if there is a warranty and what kind of warranty it is. If you negotiate with a dealer for coverage not listed on the Buyers' Guide, make sure that he adds a note to the Buyers' Guide. In the event that the contract you sign and the Buyers' Guide differ, the conditions set out in the Buyers' Guide take precedence. Read the Buyer's Guide carefully so that you know exactly what you are buying and what you are paying for it. If the dealer agrees to terms that are different than those on the Buyer's Guide, insist that those conditions be noted on the Buyer's Guide. By law, in the event of a dispute in which the terms of a contract are different than the terms on the Buyer's Guide, the Buyer's Guide generally takes precedence. By knowing your rights and taking steps to protect them when buying a used car, you can avoid buying 'someone else's headache' and end up with a gem instead of a lemon. |