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

News Release | MASSPIRG | Consumer Protection

Latest CFPB Complaints Report Shows 316% Increase in Student Loan Servicing Complaints for Massachusetts Students

United States House of Representatives Financial Services Chairman Jeb Hensarling (TX) will hold a Wednesday hearing on his so-called Financial Choice Act 2.0.  The bill leaves Massachusetts consumers and our economy even more vulnerable to Wall Street's recklessness than before the '08 crisis by taking aim at all of the 2010 Dodd-Frank Act’s protections caused by unfair bank practices abetted by regulatory failures.

> Keep Reading
Blog Post | Consumer Protection

Financial Choice Act: A Cruel Choice for the CFPB & Consumers | Deirdre Cummings

This week, on Wednesday 4/26, the House FInancial Services Committee holds a hearing on Chairman Jeb Hensarling's Financial Choice Act 2.0. It's a brutal un-do of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act that forgets, or ignores, the historical fact that reckless bank practices abetted by loose regulators wrecked our economy in 2008. A key goal of the proposal is to weaken the successful CFPB into an unrecognizable husk incapable of protecting consumers.

> Keep Reading
Blog Post | Consumer Protection

Have A Consumer Problem? | Jeanne Foy

Need Help in Resolving a Consumer Problem?

> Keep Reading
News Release | MASSPIRG | Consumer Protection

New report from leading consumer group shows millions are victims of aggressive tactics from medical debt collectors

MASSPIRG, released the ninth in a series of reports that review complaints to the Consumer Financial Protection Bureau (CFPB).  The latest report explores consumer complaints about medical debt, a major source of problems for consumers, since medical debt items on credit reports are often wrong or about the wrong consumer.  The report also demonstrates the need to defend the CFPB from partisan and special interest attacks.

 

 

> Keep Reading
Report | MASSPIRG Education Fund | Consumer Protection

Medical Debt Malpractice

MASSPIRG, released the ninth in a series of reports that review complaints to the Consumer Financial Protection Bureau (CFPB).  The latest report explores consumer complaints about medical debt, a major source of problems for consumers, since medical debt items on credit reports are often wrong or about the wrong consumer.  The report also demonstrates the need to defend the CFPB from partisan and special interest attacks.

> Keep Reading

Pages

News Release | MASSPIRG | Consumer Protection

Latest CFPB Complaints Report Shows 316% Increase in Student Loan Servicing Complaints for Massachusetts Students

United States House of Representatives Financial Services Chairman Jeb Hensarling (TX) will hold a Wednesday hearing on his so-called Financial Choice Act 2.0.  The bill leaves Massachusetts consumers and our economy even more vulnerable to Wall Street's recklessness than before the '08 crisis by taking aim at all of the 2010 Dodd-Frank Act’s protections caused by unfair bank practices abetted by regulatory failures.

> Keep Reading
News Release | MASSPIRG | Consumer Protection

New report from leading consumer group shows millions are victims of aggressive tactics from medical debt collectors

MASSPIRG, released the ninth in a series of reports that review complaints to the Consumer Financial Protection Bureau (CFPB).  The latest report explores consumer complaints about medical debt, a major source of problems for consumers, since medical debt items on credit reports are often wrong or about the wrong consumer.  The report also demonstrates the need to defend the CFPB from partisan and special interest attacks.

 

 

> Keep Reading
News Release | MASSPIRG | Consumer Protection

Federal Trade Commission to America’s used car buyers: Drop Dead.

Consumer and safety organizations blasted the FTC Commissioners’ decision, announced today, to finalize consent orders with GM and the Lithia and Koons auto dealership chains that will allow them to advertise that unrepaired recalled used cars with lethal safety defects are “safe,” have been “repaired for safety,” passed a “rigorous inspection” and qualified to be sold as “certified” cars without repairing the safety defects, if they merely include a meaningless disclosure that the cars “may” be under an  open recall.  In addition, FTC has proposed the same settlement with CarMax and  other dealers. 

 

 

> Keep Reading
News Release | MASSPIRG EDUCATION FUND | Consumer Protection

31st Annual Survey Finds Recalled Toys in Online Stores

Some toys that have been recalled for lead, powerful magnets, or other hazards can still be available for sale in online stores, according to Massachusetts Public Interest Research Group Education Fund’s 31st annual Trouble in Toyland report.

> Keep Reading

Pages

Report | MASSPIRG Education Fund | Consumer Protection

Medical Debt Malpractice

MASSPIRG, released the ninth in a series of reports that review complaints to the Consumer Financial Protection Bureau (CFPB).  The latest report explores consumer complaints about medical debt, a major source of problems for consumers, since medical debt items on credit reports are often wrong or about the wrong consumer.  The report also demonstrates the need to defend the CFPB from partisan and special interest attacks.

> Keep Reading
Report | MASSPIRG EDUCATION FUND | Consumer Protection

Trouble in Toyland

MASSPIRG's 31st Annual Survey Finds Recalled Toys in Online Stores

> Keep Reading
Report | MASSPIRG Education Fund | Consumer Protection

Predatory Loans & Predatory Loan Complaints

This is the seventh in a series of reports that review complaints to the Consumer Financial Protection Bureau. In this report, we explore consumer complaints about predatory loans, categorized in the database as payday loans, installment loans, and auto title loans.

> Keep Reading
Report | MASSPIRG Education Fund | Consumer Protection

Trouble in Toyland 2015

For 30 years, MASSPIRG Education Fund has conducted an annual survey of toy safety, which has led to over 150 recalls and other regulatory actions over the years, and has helped educate the public and policymakers on the need for continued action to protect the health and wellbeing of children.

> Keep Reading
Report | MASSPIRG Education Fund | Consumer Protection

Why You Should Get Security Freezes BEFORE Your Information is Stolen

A never ending stream of news reports about data breaches – including T-Mobile, Target Corporation, the IRS, numerous Blue Cross Blue Shield and other health plans, the University of Maryland, and the U.S. Office of Personnel Management (OPM) - is a constant reminder that you’re at risk of a data breach and therefore, identity theft.

> Keep Reading

Pages

Blog Post | Consumer Protection

Financial Choice Act: A Cruel Choice for the CFPB & Consumers | Deirdre Cummings

This week, on Wednesday 4/26, the House FInancial Services Committee holds a hearing on Chairman Jeb Hensarling's Financial Choice Act 2.0. It's a brutal un-do of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act that forgets, or ignores, the historical fact that reckless bank practices abetted by loose regulators wrecked our economy in 2008. A key goal of the proposal is to weaken the successful CFPB into an unrecognizable husk incapable of protecting consumers.

> Keep Reading
Blog Post | Consumer Protection

Have A Consumer Problem? | Jeanne Foy

Need Help in Resolving a Consumer Problem?

> Keep Reading
Blog Post | Consumer Protection

Tax Fraud Prevention Tips | Jeanne Foy

In recognition of Tax Theft Awareness Week, please see our tips on how to protect yourself.

> Keep Reading

Pages

View AllRSS Feed

Support Us

Your tax-deductible donation supports MASSPIRG 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 MASSPIRG Education Fund’s work through bequests, contributions from life insurance or retirement plans, securities contributions and vehicle donations.