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How to Buy a Used Car Without Losing Your Shirt
by Fraser Wheelock
http://www.fwcar.com

Buying a used car is always a gamble, but knowing your
rights and the seller's responsibilities can help you find
a good deal. The so-called Lemon Laws enacted in various
states hold dealers who sell used cars to certain standards
and guidelines of business behavior. If you're looking for
a used car, it's to your benefit to know what rights the
law in your state gives you.

Until 1975, consumers had little recourse if they purchased
a 'lemon'. There were no laws governing what warranties and
disclosures a dealer had to make when selling a car. With
the passing of the Magnuson-Moss Warranty Act, consumers
gained a powerful tool to help them be certain that the car
they were buying would actually run once they drove it off
the lot.

1. Know your payment options.
Basically, you have two choices: pay the entire amount in
full, or finance the total amount over time. You can apply
for a car loan from a bank, but dealers offer a wide
variety of loan options. Unless you have your heart set on
one particular vehicle, shop around for the best price at
the right terms for your pocket. Before you close the deal,
make sure that you know:

- the price of the car
- how much cash you're putting down
- the amount that you're financing
- the finance charge (how much interest you'll pay)
- the APR (annual percentage rate)
- the length of the loan term (in months or payments)
- the amount of payments
- the total sales price

2. Check the dealer's return policy.
Contrary to popular opinion, there is no 'cooling-off
period' required by law in used car sales. Even so, many
used car dealers do have a return policy that allows you
to return a used car purchased from them within a few days
if you change your mind. Check with the dealer on his
return policy rather than assuming.

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.

4. Understand the laws of your state regarding warranties.
If a used car is offered for sale 'As Is', the appropriate
box must be checked on the Buyers Guide. Connecticut,
Kansas, Maine, Maryland, Massachusetts, Minnesota,
Mississippi, New Jersey, New York, Rhode Island, Vermont,
West Virginia and the District of Columbia don't allow
As Is sales of used cars. At least three other states
require other specific disclosures. To find out what
warranties and disclosures apply to used car sales in your
state, contact your state Attorney General.

5. Have the car inspected by an independent mechanic.
Before you finalize any sale, you have a right to have it
inspected by the mechanic of your choice, at your expense.
While there's no 'standard' pre-inspection procedure, your
mechanic should check all the major systems of the car and
provide you with a written evaluation, including any
repairs needed and their estimated cost. If you still want
to buy the car after seeing the inspection report, you can
use the information you learn to negotiate with the dealer
regarding the price of the car.

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