Buying a Car

Buying a car, truck, SUV, or other vehicle is a significant purchase. You'll have many decisions to make once you decide to buy a vehicle. For example, you must choose the make and model you want. You'll also need to decide whether to get a new vehicle or a used car. These and other considerations will affect how much you can afford to spend and what payment options may work best for you.

You'll also want to understand how to prepare for and research your purchase and financing options. Also, understand what consumer protection laws apply to vehicles.

FindLaw's Buying a Car section provides resources to help you buy a car, understand financing, and know your rights under the law. Specifically, you can find articles about:

• Private and dealership used vehicle sales
• How auto financing works
• Lemon laws and other protections for defective vehicles
• What to know before signing a lease agreement
• The difference between manufacturer warranties, extended warranties, and service contracts
• General tips for buying a car

Tips for Purchasing a Car

When buying or leasing a car, it's important to research and review relevant information before making a final decision.

First, you'll need to decide what kind of car suits your needs and your budget. Assess your income and expenses to determine what you can comfortably spend on a monthly car payment. Account for the entire monthly payment amount—including insurance. Avoid paying for extra features you won't use. Your monthly car payment shouldn't exceed more than 15% of your total net income.

Also, consider fuel economy, especially if you're a commuter. A vehicle that gets more miles per gallon is good for both your budget and the environment.

Next, research the car seller. Many consumers prefer to buy from car dealerships because they find them more reputable. You can research car dealers by checking your state's consumer protection agency and Better Business Bureau (BBB). Also, look to online platforms like Google and Yelp for customer reviews.

If you decide to buy a car from a private seller, make sure you're dealing with the actual owner of the car. You can do this by checking the title of the car. You should also review the vehicle history report, which you can do online using the vehicle identification number (VIN).

Then, take the car for a test drive. This lets you see if you like how the car handles on the road, which is especially important for a used car. A test drive also allows you to check vehicle components like the radio, air conditioning, and heating. Listen for odd noises the car might make while driving and idling.

Finally, make sure you read and understand every document you must sign, including the vehicle's warranty and warranty period. It might seem tedious, but you want to know what you are agreeing to. These documents are legally binding, and it's easier to walk away from a deal than try to cancel the sale after you sign the sale contract.

Online and App-Based Car Sale Services

Online and app-based automotive buy and sell platforms have been growing in popularity. These services provide a fast and convenient option for consumers to sell or buy a vehicle. Some of these companies include:

• CarMax
• Carvana
• Peddle

These platforms offer an inventory of mostly used vehicles. Consumers can access high-resolution photos and videos, vehicle history reports, and more. Buying a car through an online service allows you to do thorough research without high-pressure sales from a dealership. Some of these companies also facilitate financing and assess trade-in values.

These platforms provide instant offers, which are convenient but don't allow for price negotiation.

If you choose to buy a car through an online or app-based service, always verify the vehicle's information and try to see the vehicle in person. While online services can be just as reputable as dealerships, there's always the possibility of misrepresentation. If the service allows, arrange for a third-party inspection before finalizing the purchase.

Also, look up the platform's BBB reviews and read their customer support policy. If you have issues with a vehicle, you want to be sure you're working with a company with a reputation for good customer service.

Payment Options When Buying a Car

When buying a car, you can finance the purchase with a car loan or pay in full. Most consumers don't have enough cash to pay for a vehicle in full and instead rely on financing. Financing can be a good payment option as long as you review and understand the terms of the financing agreement.

There are several things to think about when taking out a vehicle loan. You'll want to consider:

• The amount of money you can put down as a down payment
• The length of the loan
• Your monthly payment amount
• The annual percentage rate (APR), or interest rate

Used cars usually have higher APRs and shorter loan periods than new cars. Compare loan terms from different financial institutions and dealer financing before signing a loan agreement.

Defective Cars and Lemon Law Claims

Both federal and state laws protect consumers from defective vehicles.

The Magnuson-Moss Warranty Act is a federal law applying to most consumer products with a written warranty, including vehicles. State lemon laws specifically cover vehicles with substantial defects that remain unfixed after a reasonable number of repair attempts.

Generally, lemon laws protect new vehicle purchases. But some states also have a used car lemon law. Certain state lemon laws also apply to other types of vehicles, such as motorcycles or motor homes. Check your state's statute for specifics on what its lemon law covers.

Consumers who inadvertently buy a lemon vehicle are entitled to varying remedies, including a full refund of the purchase price (including taxes, registration fees, and even attorney fees) or a replacement vehicle.

Sometimes, dealers repurchase lemons and resell them to consumers. These vehicles are sometimes called “lemon buybacks." Under the law, dealers must disclose this and post a “lemon" or “as is" sticker on the vehicle.

Some states offer arbitration programs to help car buyers and dealers resolve lemon issues. If arbitration is unsuccessful, consider consulting a lemon law attorney. An attorney can negotiate with the dealer and help you appeal an arbitration decision.

Hiring a Consumer Protection Attorney

Buying, financing, or leasing a motor vehicle doesn't usually require a lawyer's help. But, if you think you've purchased a lemon or suspect a seller of fraud, you may want to contact an attorney.

A local consumer protection attorney can assess your situation, including determining if you have a lemon law case. They'll discuss your legal options and guide you through the next steps.