Avoiding mistakes when buying a car

Purchasing an automobile often presents an intimidating set of mechanical, financial, and legal issues. Unscrupulous dealers take advantage of uninformed consumers by using several new and old techniques. At best, a consumer may end up paying more than they expected. At worst, dealer fraud can end in repossession and a negative credit history.

Whether new or used, owning a car can easily become a thousand-dollar headache. Fortunately, an ounce of prevention is worth a pound of cure—these tips will help you to avoid the major pitfalls.

New and Used Car Purchases: 

  1. Shop around for financing before you buy, because credit unions and banks usually offer much better rates than dealerships. Financing through the dealership also gives unscrupulous dealers an opportunity to run one of many financing scams.1
  2. Get a fair price. Kelly Blue Book (KBB) and the National Automobile Dealers Association (NADA) guidebook both offer online editions of vehicle pricing, by year, make, model, and condition. Check your local library or bookstore for the print editions of these well-known guidebooks.
  3. Shop around for the best warranty. If the car is used, call the manufacturer to find out if it is still under warranty, and if that warranty is transferable to a new owner.
  4. Check for recall and service bulletins online at the National Highway Traffic Safety Administration (NHTSA) and Center for Auto Safety (CAS). You may also find out about recalls and bulletins by writing down the VIN number and calling the customer service number for the manufacturer of the vehicle you plan to purchase.

Used Car Purchases:

  1. Find out the condition of the vehicle. You can purchase a vehicle history report through a National Motor Vehicle Title Information System approved vendor, or check to see if there is a free service through your bank or credit union. Do not buy the vehicle if you find a record of serious damage, an existing lien, or if the title is identified as salvage, junk, rebuilt, or flooded. Have a mechanic check out the vehicle. Many mechanic shops offer this service for around $100. 
  2. Make sure the seller signs a document showing the purchase price, date, name of the seller, and the year, make, and model of the vehicle—the title document itself may be sufficient for a private-seller transaction.
  3. Make sure the title transfers properly. Check with your local department of motor vehicles for the rules. Many AAA offices have a vehicle registration service and can assist with the title transfer.

Problems After the Sale is Complete:

  1. Don't get scammed by the dealer on repairs. Some unscrupulous dealers repeatedly sell the same defective car, knowing that the buyer is likely to spend more money at the dealership for ineffective repairs. The buyer may spend so much on repairs that they are unable to make payments, giving the dealer the opportunity to repossess the car and run the same scam again.2  If you experience mechanical problems soon after the purchase, comparison shop before taking it back to the dealer. Pay with your credit card, so you will be able to withhold payment through your credit card company in the event there is a problem with the repairs.
  2. Know the “lemon law” for your state. Some state lemon laws hold dealers responsible for sale of defective vehicles, while others don't. The Center for Auto Safety has an online guide to state lemon laws.
 
Sources:
  1. For details on financing scams: Consumers for Auto Reliability and Safety (CARS) http://www.carconsumers.org/usedcarbuyingtips.htm
  2. Ibid.
 

Issue updates

Blog Post | Consumer Protection

How I got my finances in order | Mike Litt

Even with the knowledge I’ve gained working as a consumer advocate for several years, getting my finances in order has been a work in progress. 

> Keep Reading
Blog Post | Consumer Protection

How I started my estate and end-of-life planning | Mike Litt

Until recently, I did not have estate and end-of-life planning in mind, but it was the natural next step in my quest to be a responsible adult, with a nudge from the existential threat of the COVID-19 pandemic.

> Keep Reading
Blog Post | Consumer Protection

Resources I used to prepare my advance directive | Mike Litt

Advance directives are legal instructions that include a living will (different from a regular will) and a health care proxy. In them, you state what treatments you do or don’t want at the end of your life and who you want making health care decisions for you if you can’t. 

> Keep Reading
News Release | TexPIRG Education Fund | Consumer Protection

Report: Getting off the hook of a predatory tow in Texas

 

Every year, millions of Americans have their cars towed without their consent from a private property or public street. While getting towed is a justified consequence of parking in the wrong place or for too long, most states don’t offer drivers the decency of basic consumer protections such as access to their wallets or medicine, or maximum rates for towing and storage. And that doesn’t even take into consideration those times when drivers believe they’re towed improperly.

> Keep Reading
Blog Post | Consumer Protection

What I decided to do after shopping for long-term care insurance | Mike Litt

Before listening to In Case You Get Hit By a Bus, I didn’t know about insurance that covers the costs of long-term care, such as home health care or nursing home care, for people who need assistance with daily living activities. 

> Keep Reading

Pages

News Release | TexPIRG Education Fund | Consumer Protection

Report: Getting off the hook of a predatory tow in Texas

 

Every year, millions of Americans have their cars towed without their consent from a private property or public street. While getting towed is a justified consequence of parking in the wrong place or for too long, most states don’t offer drivers the decency of basic consumer protections such as access to their wallets or medicine, or maximum rates for towing and storage. And that doesn’t even take into consideration those times when drivers believe they’re towed improperly.

> Keep Reading
News Release | TexPIRG Education Fund | Consumer Protection

Report: Only one-third of largest phone companies have completely adopted anti-robocall technology

A looming deadline should finally force all U.S. phone companies to take stopping robocalls seriously. However, only one-third of the largest mobile and home phone providers nationwide -- and a more disappointing percentage of smaller telecommunications companies -- have installed caller ID verification aimed at squashing illegal robocalls, even though most of those businesses were required to do so by June. The stakes get higher Sept. 28, when phone providers are required to block calls from companies that haven’t at least reported their status to the FCC.

> Keep Reading
News Release | US PIRG | Consumer Tips, Consumer Protection

Back to school: financial literacy tips for college students, teens

During this time of year, families are thinking about the children going back to school, and for parents who are sending their kids to college, it can be a bit overwhelming. A key to addressing those concerns is making sure their teens are prepared for “adulting” -- in other words, taking care of their own lives.

> Keep Reading
News Release | TexPIRG Education Fund | Consumer Protection

Report: The Consumer Financial Protection Bureau turns 10

As the Consumer Financial Protection Bureau (CFPB) turns 10 years old, a new report from TexPIRG Ed Fund recaps how the agency has helped consumers over the past decade and the steps under way to refocus the CFPB on its mission after three years of retrograde decisions under the Trump Administration. The report also provides recommendations for CFPB action moving forward, especially on credit reporting.

The CFPB opened its doors on July 21, 2011, one year after President Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act. Typically referred to as “Dodd-Frank” or “Wall Street Reform,” this law created the CFPB in the aftermath of the 2008 economic crash caused, in large part, by the financial industry’s malfeasance. The CFPB became the United States’ first federal agency dedicated to protecting consumers from financial shenanigans.

> Keep Reading

Statement: Johnson & Johnson recalls sunscreen products after tests detect carcinogens

Johnson & Johnson Consumer Inc. said Wednesday it’s voluntarily recalling all lots of five types of Neutrogena and Aveeno aerosol sunscreen after internal testing showed “low levels of benzene” -- which can cause cancer -- in some samples. J&J also said consumers should stop using the sunscreen.

> Keep Reading

Pages

Report | TexPIRG Education Fund | Consumer Protection

Make the ringing stop: the FCC is finally fighting back against robocalls

A looming deadline should finally force all U.S. phone companies to take stopping robocalls seriously. However, only one-third of the largest mobile and home phone providers nationwide -- and a more disappointing percentage of smaller telecommunications companies -- have installed caller ID verification aimed at squashing illegal robocalls, even though most of those businesses were required to do so by June. The stakes get higher Sept. 28, when phone providers are required to block calls from companies that haven’t at least reported their status to the FCC.

> Keep Reading
Report | TexPIRG Education Fund | Consumer Protection

Unsafe Used Cars for Sale

AutoNation, which bills itself as “America’s Largest Auto Retailer,” is selling recalled used vehicles that contain dangerous safety defects. In a survey of over 2,400 used vehicles for sale at 28 AutoNation locations, 1 in 9 were found to have unrepaired safety recalls. Those vehicles are potentially hazardous to the people who buy them, their passengers and everyone else on the road. Vehicles with defects subject to safety recalls – including malfunctioning Takata airbags and General Motors ignition switches – have been responsible for thousands of injuries and deaths.

> Keep Reading
Report | TexPIRG Education Fund | Consumer Protection

Driving Into Debt

In much of America, access to a car is all but required to hold a job or lead a full and vibrant life. Generations of car-centric transportation policies – including lavish spending on roads, sprawl-inducing land use policies, and meager support for other modes of transportation – have left millions of Americans fully dependent on cars for daily living.

> Keep Reading
Report | TexPIRG | Consumer Protection

Fixed for the Holidays

Why Shop Refurbished?

Black Friday prices year-round: You can usually find great deals on used electronics, getting something that’s like-new, but for a sizable discount. Technically, the minute you open a new device, it becomes used, so the difference between a used and new item can be negligible. You can get an item that’s close to new at prices lower than Black Friday deals.

> Keep Reading

Pages

Blog Post | Consumer Protection

How I got my finances in order | Mike Litt

Even with the knowledge I’ve gained working as a consumer advocate for several years, getting my finances in order has been a work in progress. 

> Keep Reading
Blog Post | Consumer Protection

How I started my estate and end-of-life planning | Mike Litt

Until recently, I did not have estate and end-of-life planning in mind, but it was the natural next step in my quest to be a responsible adult, with a nudge from the existential threat of the COVID-19 pandemic.

> Keep Reading
Blog Post | Consumer Protection

Resources I used to prepare my advance directive | Mike Litt

Advance directives are legal instructions that include a living will (different from a regular will) and a health care proxy. In them, you state what treatments you do or don’t want at the end of your life and who you want making health care decisions for you if you can’t. 

> Keep Reading
Blog Post | Consumer Protection

What I decided to do after shopping for long-term care insurance | Mike Litt

Before listening to In Case You Get Hit By a Bus, I didn’t know about insurance that covers the costs of long-term care, such as home health care or nursing home care, for people who need assistance with daily living activities. 

> Keep Reading
Blog Post | Consumer Protection

How I’m supercharging my savings with socially responsible investing (SRI) | Mike Litt

Getting my finances in order has been a work in progress over several years, starting with tackling credit card debt, paying off my car loan and then building an emergency fund. 

After clearing those hurdles, I set more defined financial goals and plans in motion this year, including automatic deposits into new investment accounts.

> Keep Reading

Pages

Blog Post

Even with the knowledge I’ve gained working as a consumer advocate for several years, getting my finances in order has been a work in progress. 

Blog Post

Until recently, I did not have estate and end-of-life planning in mind, but it was the natural next step in my quest to be a responsible adult, with a nudge from the existential threat of the COVID-19 pandemic.

Blog Post

Advance directives are legal instructions that include a living will (different from a regular will) and a health care proxy. In them, you state what treatments you do or don’t want at the end of your life and who you want making health care decisions for you if you can’t. 

Blog Post

Before listening to In Case You Get Hit By a Bus, I didn’t know about insurance that covers the costs of long-term care, such as home health care or nursing home care, for people who need assistance with daily living activities. 

Blog Post

Getting my finances in order has been a work in progress over several years, starting with tackling credit card debt, paying off my car loan and then building an emergency fund. 

After clearing those hurdles, I set more defined financial goals and plans in motion this year, including automatic deposits into new investment accounts.

View AllRSS Feed

Support Us

Your tax-deductible donation supports TexPIRG Education Fund's work to educate consumers on the issues that matter, and to stand up to the powerful interests that are blocking progress.

Learn More

You can also support TexPIRG Education Fund’s work through bequests, contributions from life insurance or retirement plans, securities contributions and vehicle donations. 




TexPIRG Education Fund is part of The Public Interest Network, which operates and supports organizations committed to a shared vision of a better world and a strategic approach to social change.