Used-car warranties and as-is sales, explained
Every used car on a dealer's lot carries a federal form that says who pays if something breaks after the sale. Most buyers glance at it. It is worth reading first.
What the Buyers Guide tells you
The Federal Trade Commission requires dealers to display a Buyers Guide on every used car they offer and to give it to the buyer after the sale. It shows whether the car is sold as is or with a warranty, and, if there is a warranty, what percentage of repair costs the dealer will pay.
The Guide carries real weight. If you negotiate a change to the warranty, the Guide overrides your sales contract, so have the change written on both.
What does as is mean on a used car?
As is means the dealer will not pay for problems after the sale, and you take on that risk. The As Is box on the Buyers Guide must be checked for the sale to be made that way.
It does not mean the car is bad. It means the cost of finding out falls on you, which makes an inspection before you buy more valuable. If a salesperson promises a repair or a right to cancel, have it written on the Guide. As the FTC puts it, spoken promises are difficult to enforce.
What is an implied warranty?
Implied warranties are unwritten promises that apply to a used car unless it is sold as is. The warranty of merchantability is a promise that the car will run, although you have to show that the defect existed at the time of sale. The warranty of fitness for a particular purpose applies when a dealer recommends a car for a specific use, such as towing.
How long they last depends on the state. And if you buy a service contract from the dealer within 90 days of the sale, the dealer cannot remove implied warranties on the systems that contract covers.
Questions to ask about a warranty or service contract
A warranty comes with the sale. A service contract is something you buy on top of it. Before you pay for one, get clear answers to these.
- Which systems are covered, and which are listed as exclusions?
- Is there a deductible, and is it charged per visit or per repair?
- Who actually pays the claim: the dealer or a separate company?
- Where can the car be repaired, and do you need approval first?
- Does it overlap with coverage the car already has?
Paperwork does not replace an inspection
The FTC is direct on this: a vehicle history report is not a substitute for an independent inspection, because those reports usually do not list mechanical problems. It recommends paying an independent mechanic to look at the car, even if the dealer has certified it, and asking for a written report with repair estimates that you can use in the negotiation.
It also advises considering another dealer if one will not allow an independent inspection.
What this page will not tell you
This guide cannot say what coverage applies to a particular vehicle. The Buyers Guide on that car is the document that counts, so read it and ask your questions before you sign anything.
Questions about a specific vehicle in New Castle, PA? Call (724) 658-1212 or find us here.