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How the FTC’s Used Car Rule Protects Consumers

The Federal Trade Commission (FTC) has a rule on the books that applies to all used car dealerships that sell or offer to sell at least five used vehicles in a 12-month period. So, essentially, this rule—the FTC’s Used Car Rule—applies to almost all used-car dealerships. 

One of the better-known provisions of the Used Car Rule is the requirement of dealerships to display a Buyers Guide on used vehicles. This guide should be available to prospective buyers before they make a purchase and/or the vehicle in question is ready to be sold. Additionally, the Guide must be conspicuously displayed inside the vehicle. In other words, the dealership is not permitted to stuff it in the glove compartment or place it on the floorboard.

What Does the Buyers Guide Include?

The first thing most consumers notice about a used vehicle’s Buyers Guide is the warranty information. The dealership must check a large box that indicates the vehicle’s status as either: 

  • An “As-Is” vehicle, meaning the dealer is not offering a warranty (not allowed in Kansas); or
  • Having a “limited” or “full” dealer warranty. If the dealer is offering a limited warranty, the Buyers Guide should indicate the percentage of expenses for labor and parts that the dealer will pay. This only applies to covered systems that fail during the warranty period. 

The next section of the Buyers Guide includes information about non-dealer warranties (such as manufacturer warranties) and any service contracts. The remainder of the first page of the Buyers Guide provides information on accessing the vehicle’s history report and open safety recalls. 

Other information the FTC requires to be on a Buyers Guide includes:

  • Advice on oral vs. written promises (always get promises in writing);
  • Common problems with used cars;
  • Details on the car’s mechanical and electrical systems; and
  • Guidance on asking for a mechanic’s inspection.

Contradictory Statements

Under the FTC’s Used Car Rule, dealerships are prohibited from making any oral or written statements that run contrary to the disclosures in the Buyers Guide. Making contradictory statements is one way that dealers can run afoul of the Used Car Rule. There are many other ways that dealerships can be in non-compliance with the Rule; for instance, the fonts of certain sections of the Buyers Guide must be presented in certain fonts. Each violation of the Used Car Rule could result in a $43,000 fine. 

Consumers who didn’t receive the Buyers Guide and other consumer protections before purchasing a used car might be eligible for compensation or recourse. If you think you’ve been taken advantage of by a used car dealership, you need the help of a consumer protection attorney as soon as possible. 

Bell Law, a Kansas City firm, is dedicated to protecting the consumer rights of Americans. If you’ve been wronged, we want to help make it right. Call us at (816) 886-8206 today to set up a free consultation.

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