Can You Return a Car?
Avoid Car Buyer's Remorse
Many car buyers have "buyer's remorse" and wrongly believe they can return a USED car for several days after the purchase. This site will explain that there is no country wide law in the US or Canada (and indeed no country that I have found) that requires a car dealer or a person selling a NEW or USED car to take a car back. It will outline the limited and very specific instances when a used car can be returned to the seller. It will also discuss the several megadealers in the US and the UK who will accept returns on used car purchases - not because they legally have to, but because it is part of their marketing strategy.
We'll also discuss Lemon laws which apply to new cars only and have very specific definitions. Many people say their car is a "lemon" but it is actually a legal term applied to a very small number of vehicles.
Avoid Buyer's Remorse - don't sign any contract or even leave a deposit unless you are sure. 100% sure. 110% sure. 200% sure if possible.
Limited cases where you can return a used car
When can I return a car?
- The dealer CHOOSES to add a clause to your contract that allows you to return the car within a specified amount of time.
- The car was purchased in CALIFORNIA, USA or ONTARIO, CANADA - See the section below on the CALIFORNIA Car Buyer's Bill of Rights or the ONTARIO Motor Vehicle Dealers Act.
- The car was leased in NEW JERSEY - You have 24 hours to change your mind.
The Three Biggest Myths on Returning a Car
- You have a 'Three-Day Right to Cancel' a used car purchase. Not true! The Three-Day Right to Cancel law does not apply to the sale of automobiles
- The 'Lemon Law' will help you if your used car needs repairs after purchase. Not true! The Lemon Laws protect consumers who buy NEW cars that turn out to have CONSTANT problems and require them to be in the repair shop more often than it can be driven. The criteria for a lemon car is a legal criteria with very limited scenarios. While millions of people talk about lemon cars, a mere few thousand are legally classified as a lemon per year. Used cars are not covered by Lemon Laws.
- Used cars come with a warranty by default. Another big fat not true! Most used cars are sold without any warranties. If the contract you signed says the car is sold "As Is" or if the contract states that there are no warranties made, then you are on your own if the car breaks down - even if it breaks down the next day after you buy it. If you want coverage, if you want a warranty, then pay for one and get it in writing.
Cooling off rule - it doesn't apply
30 day car return myth
The Federal Trade Commission's three-day right to cancel - called the Cooling-off Rule - gives you three days to cancel purchases of $25 or more made at the buyer's home, workplace or dormitory or at facilities rented by the seller on a short-term basis.
So, if you convinced the dealership to come to your house and you completed the sale at your house - then the cooling off rule applies.
This myth is so common that the US Government specifically addresses it on their website and states "the 3-Day Cooling-Off Rule does NOT apply to the purchase of new automobiles."
Here is another great article "When You Buy A Car, The Three Day Cool Off Period Is A Myth" which confirms what I note here - but some people need to hear it 2 or 3 times before they will overcome the myth.
Buyer's Remorse Poll
What has been your fortune in the car buying world?
State and Provincial Laws - Details on Laws that Affect You
- Buying a Used Car - Federal Trade Commission Guide
A guide from the Federal Trade Commission "Dealers are not required by law to give used car buyers a three-day right to cancel. The right to return the car in a few days for a refund exists only if the dealer grants this privilege to buyers. Dealers
- California - DMV
Car Buyer's Bill of Rights - Important Facts About A New Law That Substantially Impacts The Purchase Of New And Used Vehicles
- New Jersey - Guide to Auto Leasing
Guide to rules on auto leasing in New Jersey.
- Can You Return the Car You Just Bought?
Edmunds.com says "You might wish you could void your purchase contract and simply give the car back to the dealer. But unlike other consumer products, it's not easy to return a car."
Most Used Cars are Sold "As Is"
A car which is sold without a warranty is sold "as is." That means the seller has no obligation to fix any problem that may arise.
Check the Buyer's Guide window sticker to determine if you will receive a warranty. That sticker will tell you if you have a warranty, or if you are buying "as is."
Almost every used car sale is an "as is" sale.
No Car Returns!
There is no federal law requiring a car dealer or a person selling a car to take a car back.Let me repeat that - there is no federal law requiring a dealer or seller to take a car back - you don't have 24 hours during which you can change your mind, you don't have three days to reconsider - when you buy a car it becomes your property.
Earl Stewart - 99% of Car Dealerships Will Not Take a Car Back!
Dealer Makes an Offer to Allow Car Returns
Unless it is in the contract - the dealer has no obligation to buy a car back!
Some dealers provide an option for the buyer to return the car. If this is the case, these terms will be in your purchase contract.
Carmax is known to extend this offer. "5-Day Money-Back Guarantee - We know that not every car is perfect for every person, so all used CarMax cars can be returned for any reason within a 5-day period. See your Sales Consultant for written details."
While I mention Carmax in the US and Carcraft in the UK, their policies may change so BE SURE to check the contract if buying a car from either of these companies. And other car dealerships may offer this as well - never hurts to ask.
Test Your Knowledge On Car Buyingview quiz statistics
When the Dealership Steals Back the Car They Just Sold You
I am very familiar with all aspects of car transactions due to quality issues - but have far less expertise on dealing with car returns due to issues with loans. But many of the comments on my articles have talked about "You bought a car and a couple days later the dealership comes by in the middle of the night and repossess the car!"
For matters on financial aspects of deals and on lemon laws too, I encourage folks to read material from Steve Lehto who has been practicing consumer protection and lemon law for 23 years in Michigan. He taught Consumer Protection at the University of Detroit Mercy School of Law for ten years and wrote The Lemon Law Bible. He also wrote Chrysler's Turbine Car: The Rise and Fall of Detroit's Coolest Creation and The Great American Jet Pack: The Quest for the Ultimate Individual Lift Device.
Car dealerships cause the greatest number of consumer complaints, and many consumers face misleading marketing tactics and even discriminatory lending from auto finance centers.
The CALIFORNIA Car Buyer's Bill of Rights
Used car buyers may purchase a two-day sales contract cancellation option.
There is no "cooling off" period unless you obtain a contract cancellation option. YOU MUST PURCHASE THIS OPTION WHEN BUYING THE CAR.
Consumers who purchase a used car for less than $40,000 must be given an opportunity to purchase a two-day Contract Cancellation Option Agreement. The contract cancellation option does not apply to used cars priced at $40,000 or more, new cars, private party sales, motorcycles, off-road vehicles, recreational vehicles, or vehicles sold for business or commercial use.
The following indicates how much you can expect to pay if you choose to purchase the contract cancellation option:
* $75 for a vehicle costing $5,000 or less;
* $150 for a vehicle costing more than $5,000, but not more than $10,000;
* $250 for a vehicle costing more than $10,000, but not more than $30,000; or
* One percent of the purchase price for a vehicle costing more than $30,000, but not more than $39,999.99
If you choose to return the vehicle, within the time specified, the dealer can charge a maximum restocking fee of:
* $175 for a vehicle costing $5,000 or less;
* $350 for a vehicle costing more than $5,000, but less than $10,000; or
* $500 for a vehicle costing $10,000 but less than $40,000.
The official government web site is http://dmv.ca.gov/pubs/brochures/fast_facts/ffvr35.htm
The Contract Matters, What the Salesperson Said Does Not
Be certain to get everything in writing. For example, if you're told that you can turn the return the car within a certain number of days, don't take the salesman's word for it, get it in writing as part of the contract, not just on a blank piece of paper signed by the salesman. Usually, if it is not on the printed contract, it is not binding.
My Car is a Lemon
A Lemon Car is a legal definition - not an opinion
If the paint is peeling, the light switch came out when you pulled on it, the car makes "funny noises" but otherwise drives just fine, or you found 10 things you don't like about your new car but none of them prevent you from driving it, then No, you do not have a Lemon.
If the brakes don't work, the car won't go into reverse gear, the darn thing won't start on cold mornings or hot afternoons, the rear door opens all by itself, the driver's seat wobbles, or the car chugs along at 30 mph when it should be going 50 mph, then Yes, you may have a Lemon. Providing you've given the manufacturer an opportunity to repair the defect.
Generally, if a NEW car has been repaired 4 or more times for the same Defect within the Warranty Period and the Defect has not been fixed, the car qualifies as a Lemon. A vehicle that continues to have a defect that substantially impairs its use, value, or safety could be classified as a lemon. All States differ so you should consult the Lemon Law for your particular State. Note that the warranty period may or may not coincide with the Manufacturer's Warranty. Generally lemon laws ONLY apply to the first owner, but they may continue to apply as long as the car is under the original new car warranty period.
You may have a Lemon, but if you do nothing to protect your Consumer Rights, such as documenting your Repairs and allowing the Manufacturer a chance to fix the problem(s), you lose all rights under the various State Warranty Acts.
Lemon Laws - Consumer Advice
The author, James Lewis, is an expert witness with experience working with the nation's top consumer law firms to protect car owners when something goes wrong. In this book he offers great advice for how to avoid getting into car trouble and how to get out of it.
When financing falls through
Often the dealer can ask you to return the car!
If you buy a car that is financed through the dealership, the dealer CAN cancel the contract, but typically only if you are notified within 10 days of the date on the purchase contract.
As with all contracts, the specifics are tied to YOUR SPECIFIC CONTRACT. Typically you sign a document that is called "RETAIL INSTALLMENT SALES CONTRACT." This will typically have a section "Seller's Right to Cancel." This section tells you that after you sign the purchase contract and leave with the car, the dealership is going to find a finance company or bank to buy your contract (this is much like what happens with home mortgages). If the car dealer cannot find someone to buy your purchase contract, it can cancel the purchase contract. In this scenario, the dealership is required to return to you all consideration given for the purchase. This includes any cash you paid and your trade-in vehicle (or if your vehicle has already been sold, the value of the vehicle).
Avoid Buyer's Remorse!
You can't return a car - so avoid needing to return a car
- Don't Allow Yourself To Become a Victim of "Buyer's Remorse!"
- Don't sign any sales contracts, lease contracts or finance contracts unless you are 200% certain that you want to go through with the deal and buy the car.
- Don't give any car dealer or private party a deposit on a car deal unless you are absolutely sure you are going to see the deal through to it's final conclusion. A deposit is not a legal requirement. The seller wants the deposit so they can exert control. They want your money locked in before any "Buyer's Remorse" can occur.
- The time to mull over the purchase is BEFORE you make the purchase. Take a day or two and sleep on the deal before you make your decision.
Ontario Motor Vehicle Dealers Act
- Purchaser can cancel a contract within 90 days if they can show the dealer failed to disclose or provided an inaccurate disclosure of the following items:
- Distance travelled (within lesser of 5% or 1,000 km)
- Wrong statement used when distance travelled unknown
- Prior use as daily rental, emergency vehicle, taxi, limo
- Make, model, and model year
- Irreparable, rebuilt or salvage brand
Carcraft in the UK
United Kingdom Car Return
Carcraft is a large Used Car Dealer in the UK with more than 10 dealerships. There is no law requiring them to accept a return, but they have created an exchange option. If within 7 days of buying your car you aren’t totally happy with it, just bring it back to us and we’ll exchange it for an alternative of your choice from our showroom. The only condition is that you have done less than 500 miles since taking delivery.
While I mention Carmax in the US and Carcraft in the UK, their policies may change so BE SURE to check the contract if buying a car from either of these companies.
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