Arizona Attorney General
Terry Goddard
Educating • Protecting • Empowering
Arizona Consumers
Arizona
Attorney General’s
Office
1275 West
Washington Street
Phoenix, Arizona 85007
602.542.5763
400 West Congress
South Building
Suite 315
Tucson, Arizona 85701
520.628.6504
Outside the Phoenix
or Tucson metro area
800.352.8431
www.azag.gov
CONSUMERS’ GUIDE
TO BUYING A CAR
Steer Clear of Trouble!
Table of Contents
Message from Attorney General Terry Goddard................................1
Advertising .......................................................................................2
Do Your Homework..........................................................................2
Negotiating the Deal.........................................................................3
Closing the Deal ...............................................................................4
Service Contracts.............................................................................5
Tips on Buying Used Cars................................................................6
Arizona’s Lemon Law .......................................................................7
Resources........................................................................................8
1
August 2006
Next to a home, an automobile is often the largest purchase we
make. Yet, shopping for the best deal on a new or used car can
be a mysterious, painful and often regrettably expensive experience
for many. Auto sales and repair complaints consistently rank #1
among the consumer complaints filed with the Arizona Attorney
General’s Office.
Many problems consumers experience can be avoided. Any
deal you make is one you’ll have to live with. Arizona does not
have a three-day right to cancel a car sale. Before heading out
the door to shop for your next car, take time to do your
homework. Consumers armed with information such as loan
interest rates, purchase prices, trade-in values and expected
monthly payments tend to get the best deals. You will be much
more successful keeping in mind one basic truth – everything
about buying a car is negotiable.
Sincerely,
Terry Goddard
Arizona Attorney General
Message from Attorney General
Terry Goddard
2
Advertising
• Be skeptical of car advertisements and read the fine print.
• Sometimes, the advertised deal only applies to a few vehicles
or is available only under certain conditions (i.e., a credit score
over 750!).
• Beware of advertised minimum trade-in amounts or “free” gifts
with a new car purchase. Dealers may raise the price of the car
to offset a low value trade-in or the cost of the gift.
Do Your Homework
• Know what make and models you are interested in and what
they should cost before you visit the dealership. Use the
library or the Internet to get an idea of a price range and the
cost of options.
• Find out the dealer’s cost from a reputable online authority. You
can look up this information on Web sites such as
www.edmunds.com and www.kbb.com.
• Know the value of any auto you plan to trade in. If it’s worth
less than what you owe, the dealer will always try to add that
difference to your cost.
• Check with the Better Business Bureau on the dealer’s reputation
for honesty and service.
• It is often cheaper to arrange financing with a bank or credit
union before going car shopping.
Consumers ’ Guide to Buying a Car
3
Negotiating the Deal
• Make buying your new car, selling your old car and financing your
new car three separate transactions.
• Understand that the Manufacturer’s Suggested Retail Price
(MSRP) is the sticker price and not necessarily a fair price for
the car.
• Even the dealer invoice price may be higher than the dealer’s
actual cost.
• Be prepared to walk away. Going “out the door” is your
ultimate weapon.
• Ask for the dealer’s best price up front and keep asking for it
throughout your negotiations.
• Be sure the price quote includes everything, except for sales tax,
registration and title fees.
• Keep track of the details of the deal. Take a notebook, calculator,
pen and tape recorder to make it easier.
• Take someone with you. Two people are less likely to miss
something.
• Do not assume salespeople are your friends. Most are paid
on a commission basis, so the more you spend, the more
they make.
• Remember, everything is negotiable – no matter what the
salesperson says.
4
Closing the Deal
• Make sure all promises made by the salesperson or dealership
are in writing. Review all documents and understand all terms
before signing.
• If a contract has terms substantially different from what the
salesperson promised, do not sign the contract unless you
accept the new terms.
• Do not allow anyone to put false information on any forms.
If something goes wrong, the false information could be held
against you.
• Do not sign any forms that have blank spaces. Draw a line
through any blanks on documents you sign.
• Do not take home a new or used car before financing is
approved. This practice is called “spot delivery” and is designed
to “lock you in” to a purchase. If your financing is not approved,
you could lose your down payment.
• When financing through a dealer, always negotiate the car price
first. Once the price is settled, then negotiate the monthly
payment amount. Otherwise, you may end up with a reasonable
monthly payment, but with a longer term and/or a higher interest
rate (i.e., your car will cost more).
• Never buy life or disability insurance from a dealer, without
comparison shopping with an insurance agent.
• Always ask the dealer if the interest rate being offered on dealer
financing is the lowest rate he or she can offer and whether it
includes a profit for the dealer. “Is this the lowest rate you can
give me?”
• There is no three-day right to cancel for new or used cars
in Arizona.
Consumers ’ Guide to Buying a Car
Service Contracts 5
• Dealers often present service contracts, sometimes called
extended warranties, in the final stages of buying a car.
• Service contracts provide for the repair of certain parts or
problems. These contracts are offered by manufacturers, dealers
or independent insurance companies. Extended warranties are
often the most highly marked-up item in a car purchase.
• Service contracts may be a good idea if you intend to keep
your car longer than the warranty period, if the car you’re
buying does not have a very good reliability record, or if you
just want additional peace of mind.
• Beware of service contracts that are not offered by the manufac-turer.
You need to know that the company is financially able to
stand behind its promises.
• Service contracts may not be worth the additional cost. Be sure
you understand the full cost of the contract, not just your
additional monthly payment.
6
Tips on Purchasing Used Cars
Obtain a vehicle history report on a used car before you
purchase. The report gives you information on the used vehicle's
title, registration, odometer, major damage and recall history.
Several online services are available, and dealers usually provide
this service for free.
• Have a trusted mechanic inspect the used vehicle before you
buy. This may cost around $100 or more, but could save you
money in the long run.
Consumers ’ Guide to Buying a Car
7
• Almost all used cars in Arizona are sold “as is.” That means that
no matter what a salesperson may tell you, the dealer doesn’t
have to fix the car if it breaks, unless
• your contract specifically includes this promise; or
• the problem falls within Arizona’s Used Car Lemon Law
(see below).
Arizona’s Lemon Law
New Car. The Arizona Lemon Law (A.R.S. § 44-1261 et seq.) has
a number of specific protections. Consumers should consult the
law or an attorney, if their new car does not operate in a reason-able
manner. Here are the basics:
The period covered by the Lemon Law is the same as the term of
the manufacturer’s warranty or two years or 24,000 miles,
whichever is earlier. The covered period begins on the date the
consumer receives the vehicle.
During the covered period, if the manufacturer fails to repair the
defect(s) after four attempts, or if the car is out of service by
reason of repair for a cumulative total of 30 or more calendar days,
the manufacturer must accept return of the car or replace it with a
new car (contact your dealer).
Used Car. A used car is covered by the Arizona Used Car Lemon
Law (A.R.S. § 44-1267) if a major component breaks within 15
days or 500 miles after the car was purchased, whichever comes
first. If it breaks, you'll still be responsible for a small amount of
the repair cost. The recovery for the consumer is limited to the
purchase amount paid for the car.
8
Resources
Arizona Attorney General’s Office
Consumer Information and Complaints
1275 West Washington
Phoenix, Arizona 85007
602. 542.5763 (Phoenix)
520.628.6504 (Tucson)
1.800.352.8431 (In-State Toll Free)
www.azag.gov [Online Consumer Complaint Form available]
Arizona Auto Dealers Association
AUTOCAP (Complaint Mediation Program)
P.O. Box 32717
Phoenix, AZ 85064-2717
602.468.0888
www.aada.com/consumer.asp
Arizona Independent Automobile Dealers Association
(Used Car Dealers)
Complaint Mediation Program
5517 North Black Canyon Hwy
Phoenix, AZ 85015
602.246.1498
www.aiada.net/consumer
Arizona Department of Insurance
(Warranty Company Complaints)
2910 N. 44th Street, Suite 210
Phoenix, AZ 85018
602.364.2499
400 W. Congress Street, Suite 152
Tucson, AZ 85701
520.628.6370
Statewide 1.800.325.2548
www.id.state.az.us/consumer
Arizona State Statutes
Many public libraries and law libraries provide public access to the state
statutes in book form, including:
Law and Research Library Division of
Arizona State Library Archives and Public Records
602.542.5297 or www.lib.az.us/is/locations/index.cfm
Maricopa County Law Library
602.506.3945 or www.superiorcourt.maricopa.gov/lawlibrary/
Statutes can also be accessed online at
www.azleg.state.az.us/ArizonaRevisedStatutes.asp
The Better Business Bureau of
Central/Northern Arizona
4428 North 12th Street
Phoenix, Arizona 85014
602.264.1721 (Phoenix)
1.877.291.6222 (Toll Free)
www.phoenix.bbb.org
The Better Business Bureau of
Southern Arizona
434 South Williams Blvd., Suite 102
Tucson, Arizona 85711
520.888.5353 (Tucson)
1.800.696.2827 (outside metro Tucson)
www.tucson.bbb.org
Consumer Reports
www.consumerreports.org
Web sites for dealer cost and trade-in values
www.edmunds.com
www.kbb.com
The Attorney General’s Community Services Program includes
Satellite Offices and the Fraud Fighter Van. Satellite Offices
make it easier for residents to get information on consumer fraud
and civil and victims’ rights issues in their own neighborhoods.
Volunteers are available to make educational presentations to
community groups and distribute materials at local events.
Satellite Offices are located
throughout Arizona. A complete
list of locations and schedule of
events are posted on the
Community Services page of
the Attorney General’s Web site.
The Fraud Fighter Van is the
newest tool to bring services
and information to senior
centers, libraries and neigh-borhoods.
The Fraud Fighter
Van is filled with information
about identity theft, scam alerts,
Internet safety and much more.
For more information, contact:
Community Services Program
Arizona Attorney General’s Office
1275 West Washington Street
Phoenix, Arizona 85007
602.542.2123 or 1.866.358.6661
communityservices@azag.gov
Other Consumer Publications
available from the Arizona
Attorney General’s Office include:
• Top 10 Consumer Scams
• Fraud Fighter Accounts
• Identity Theft
• Internet Safety
• Predatory Lending
Phoenix
Mesa
Tucson
Payson
Prescott
Flagstaff
San Luis
Tempe/ASU
Sun City
South Tucson
Green Valley
Lake
Havasu
City
Sierra
Nogales Vista
Sedona
Somerton
Yuma
Apache Junction
Florence
www.azag.gov
