Making the Most of Sales While Juggling “As Is” Car Disclosure Laws

How to properly disclose vehicles so that they are sold legally and to satisfied consumers

You exert every effort to keep your inventory moving; no car remains on your lot for longer than 60 days, and you constantly get a steady flow of in-demand used cars. You prefer to offer a wide range of vehicles to consumers at various price points. You want to make sure that anybody who walks into your dealership will find what they need because not everyone wants a brand-new car.


You won’t always obtain automobiles, trucks, or SUVs that have had the best lives, whether you buy at auction or take a trade-in. After purchasing a secondhand automobile, you can discover that it’s been in a few collisions, has been a taxi cab, or has been utilized by the government. The truth about this car’s background must be revealed, even though it could make it a little more difficult to sell. It is not only ethically correct but also required by law to be upfront with customers about potential risks.


Why you must be completely transparent

The Federal Trade Commission’s (FTC) Used Automobile Rule, which mandates that you display a Buyer’s Guide in the window of every used automobile on your lot, must first be followed. The buyer’s Guide is a type of vehicle disclosure that informs the consumer if the vehicle is being sold “as is” and if any warranties are available.


However, you are also required to fully disclose a vehicle’s known past in addition to the Used Car Rule. You can’t act ignorant and claim you were unaware of a vehicle’s history or prospective flaws.


The National Association of Attorneys General stated that “vehicle history information is a material fact and, therefore, must be disclosed under state unfair and deceptive acts and practices laws.” Vehicle titles, state motor vehicle record databases, NMVTIS, privately run services like CarFax and AutoCheck, auction announcements, and manufacturer records are just a few places where dealers can access this information. Dealers have better access to the information than do consumers, and it is available. It should be disclosed with whatever information the dealer can reasonably gather.


State-by-state vehicle disclosure laws can differ, but if in doubt, share more. Although it may, in fact, impair your prospects of closing a purchase, would you rather lose the sale or have a lawsuit brought against your dealership? Then, in addition to losing the sale, you would also have lost your job.


assist consumers in appreciating the benefits of car disclosure listings

It need not be a deal breaker to reveal a car’s troubled past. It’s entirely possible to sell damaged cars and still have the buyer be satisfied. Simply make an effort to sell those vehicles to the correct clients as soon as they enter your lot. If you desperately need a car but don’t have a lot of money to spend, a less-than-ideal car can be the right solution. Or for someone who only needs something simple for the daily five-mile commute to work. Many people simply do not desire all the bells and whistles.


There may be some advantages you can point out to a potential consumer to sway their opinion in your favor.


1. Previously rented automobiles


Although it’s impossible to tell how many different people have driven a rental car, they can generally be a great investment. Because they aren’t driving their own automobile and don’t want to cope with the consequences of any accidents, people who rent cars are frequently too cautious. Additionally, rental car companies often adhere to tight maintenance procedures and schedule regular oil changes, tire rotations, and other repairs.


2. Ex-government automobiles


For a period of three to five years, the government leases fleet vehicles, which the dealer then auctions off. They often come in decent quality, have only had one owner, and have received adequate maintenance from the government. However, there can be a wide range in how they are applied.


3. A “buyback” under the Lemon Law.


The phrase “Lemon Law” is sufficient to instill fear in the heart of a deserving purchaser, but don’t let them leave too soon. Try to clarify that this indicates that the manufacturer of the car repurchased the vehicle due to a specific warranty problem or defect. The manufacturer will typically attempt to address the issues and make repairs when they receive the vehicle back, so the vehicle ought to be safe to drive at this point.


You should never give potential customers information that isn’t accurate, but you also don’t have to have a negative attitude toward vehicle disclosures. Being transparent is a service to your clients; therefore, you should position it that way. Be truthful about the car’s flaws, but also be sure to highlight any favorable aspects; elite auto salespeople are masters at making lemonade out of lemons, especially when the pricing reflects it.


Additional Things to Keep in Mind About Used Car Disclosure Laws

Although the federal Used Car Rule provides the framework for used car disclosure procedures, it’s important to pay attention to the different state-specific laws that further sculpt this environment. Federal standards are supplemented in several states by disclosure legislation, giving consumers more control over the process and sellers more obligations.


For instance, dealers are required to submit a thorough written statement describing the general mechanical condition of the vehicle in many states. Included in this are any well-known problems with the vehicle’s main components, such as the engine or transmission. The notification of flood damage is particularly required by law in several places, which is important because it may have an important influence on the lifespan and safety of the vehicle.


Additionally, certain state laws mandate that dealers reveal if the odometer has been tampered with or whether there is a discrepancy between the displayed and real mileage, which is a crucial consideration for many purchasers of used cars. Here, any errors could result in fines and penalties.


Then there are titles that have been “branded” or “salvaged.” In several places, a salvage or rebuilt brand must be present on the title of an automobile that has been written off due to significant damage and then rebuilt to drivable condition. This branding needs to be made known to prospective buyers because it has a big effect on the price of insurance and resale.


How Dealers Benefit from Used Car Disclosure Laws

Although it may appear like these requirements place additional difficulties on used car sellers, there may be benefits to completely supporting disclosure laws. First off, thorough transparency can improve a dealership’s standing. Consumers in the digital age have a wide range of channels to express their experiences, whether positive or negative. Transparent business procedures increase the likelihood of favorable evaluations and referrals by making clients feel appreciated and valued.


Second, it might result in more devoted customers. Customers are more likely to return for their next vehicle purchase or refer the dealership to friends and family if they have a great buying experience where they feel informed and treated fairly.


Finally, the dealership can avoid potential legal trouble by strictly adhering to used automobile disclosure rules. Dealerships defend themselves against legal actions that could damage their reputation and incur hefty financial fines by strictly adhering to all disclosure regulations.


Full disclosure is essential.

Selling used automobiles totally transparently to customers is not only the right thing to do, but it’s also required by federal and state used car disclosure rules. By abiding by these rules, dealerships can improve their reputation, gain the trust of their customers, and ultimately contribute to their long-term success in addition to maintaining compliance and avoiding legal ramifications.


It is also important to remember that educating customers about the legal and technical aspects of vehicle disclosures can aid in the sales process. The implications of these disclosures for customers and the vehicles they are evaluating are frequently unknown. Dealers may build stronger relationships with purchasers by guiding them through the process, outlining the significance of each disclosure, and assisting them in understanding how these disclosures ultimately safeguard their rights as consumers. This not only facilitates a quick sale but also develops a relationship based on trust and respect, increasing the likelihood of future repeat business and recommendations. In the end, complete openness in car disclosures benefits the buyer and the dealer alike.

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