In general, buying from a dealer is a safer option
because you are dealing with an institution, which means you are
better protected by law. The Federal Trade Commission requires dealers
to post a Buyer's Guide in the window of each used car or truck
on their lot. This Guide specifies whether the vehicle is being
sold "as is" or with a warranty, and what percentage of
repair costs a dealer will pay under the warranty. Keep in mind
that private sellers generally have less responsibility than dealers
for defects or other problems. FTC rules do not apply to private-party
sales.
Expect to pay higher prices at a dealer than if
you buy from an individual. Many dealers inspect their cars and
provide an inspection report with each car. However, this is no
substitute for your own inspection. Some dealers provide limited
warranties, and most sell extended warranties. Watch out for dealer
warranties that are "powertrain" warranties only, and
not "bumper-to-bumper" full-coverage warranties. It's
best to compare warranties from multiple sources.
Some dealers provide "certified" cars.
This generally means that the cars have had a more thorough inspection
and come with a limited warranty. Prices for certified cars are
generally higher. Be sure to get a list of what was inspected and
what is covered under the warranty.
Purchasing a car from a private seller could save
you money, but there are risks. The car could be stolen, damaged
or still under a finance agreement. If a private seller lies to
you about the condition of the vehicle, you may sue the individual
if you have evidence and you can find him. An individual is very
unlikely to give a written warranty.
Beware: Dealers Posing as Individuals
Some dealers pretend to be private sellers
to avoid legal obligations and to sell problematic cars to
unsuspecting buyers. Be wary: if an ad gives only a mobile
number or specifies a time to call; if the same number appears
in several ads; or the seller wants to bring the car to you
or meet you somewhere.
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