Buying a New Car
What to know before shopping for a new car.
Buying a New Car
Buying a car is one of the biggest purchases you’ll ever make. Before you go shopping, consider the following:
Before going to the dealership:
- Know what type of car you want and how much you can afford.
- Will this car meet you and your family’s needs?
- Consider the overall cost of ownership, including gas mileage, maintenance and repairs, insurance costs, and depreciation.
- Check consumer publications, the Internet, and car magazines for information on models and prices.
- Read the California Car Buyers’ Bill of Rights.
While at the dealership
When you are ready make the purchase, you should do the following:
- Negotiate the price of the car, not the monthly payment.
- Make sure the options and equipment you want is included in the price and on the car.
- Don’t sign a contract you don’t understand
- Understand the contract before you sign it, including the vehicle’s price, fees, and finance charges. Verify that the information on your credit application and sales contract is correct. You have the right to understand the contract before you are asked to sign it.
What if the sale was not made in English?
If you do not speak to the dealer in English, the dealer must give you a copy of the contract in the language you used.
What happens if the financing isn’t approved?
If the dealer agrees to arrange financing, but cannot get it at the promised interest rate, the deal is off. The dealer cannot charge you for the use of the car.
The dealer must give all your money back, including any trade-in. If the dealer sold your trade-in, you must get back at least the amount listed for your trade-in on the contract.
You do not have to sign a new contract at a higher interest rate, or make a bigger down payment, unless you want to. These rules also apply if you tell the dealer you are going to get your own loan, but are unable to get it.
Can I return the car if I change my mind?
No. Dealers must post a sign telling you, “There is no cooling-off period.” This means you cannot change your mind after you sign the contract.
Ask to see the warranty
New cars are sold with a factory warranty that pays for most repairs for a set period of time. Ask how long the warranty lasts and what repairs are covered.
Additional warranties and maintenance contracts
Extended warranties, mechanical breakdown insurance and maintenance contracts are available at considerable extra cost. Be sure you understand what items are covered, what is not, and what additional protection (if any) you are getting over the manufacturers warranty. The costs of these products are negotiable and you do not have to buy them to get financed or to get a lower interest rate.
Can I cancel extra warranties and maintenance contracts?
Yes. You can cancel in writing within 60 days for a full refund. If you are financing, the refund will be paid to the finance company. Your payment will remain the same but for a shorter time. After 60 days, you can still cancel and get back a portion of the amount charged.
Civil Codes 2282.9, 1632, 1794.41
County of Los Angeles Department of Consumer and Business Affairs. Last change: May 5, 2008