New, Leased, and Pre-Owned

New, Leased, and Pre-Owned

Since cars are considered goods, protected by: Uniform Commercial Code (UCC) If for personal, family or household use: Covered by both federal and state consumer protection laws

How much can you afford? Depends on your savings, monthly earnings, living expenses, and any debt you have The finance charge is the cost of the loan in dollars and cents The annual percentage rate (APR) is the true interest rate of the loan

Before you sign, know The exact price you re paying The amount you re financing The finance charge The APR The number and amount of payments The total sales price (monthly payments plus down payment)

Debt problems Can cause high debt when buying things on credit you re unable to afford Understand and calculate your monthly payments You are obligated to pay the loan regardless if the vehicle is still drivable or not

Federal Trade Commission (FTC) regulation protects consumers buying vehicles on credit Only applicable when financing through car dealership Does not apply if you borrow money from a lending company with no connection to seller

Do your homework before purchasing Better negotiation leverage Car Buying Terms: Invoice Price Manufacturer s initial charge (including delivery) to the dealer. Base Price Cost of vehicle with standard equipment and warranty but without optional equipment.

Car Buying Terms: Monroney Stick Price (MSRP) Manufacturer s suggested retail price (MSRP) Manufacturer s transportation charge Engine and transmission specifications Standard equipment and warranty details Optional equipment and pricing City and highway fuel economy ratings, as determined by the EPA As of September 2007, crash test ratings as determined by the National Highway Traffic Safety Administration The sticker is required by federal law to be affixed to a new vehicle s window. Only the purchaser may remove it.

Car Buying Terms: Dealer Sticker Price The Monroney sticker price plus the suggested retail price of the dealer-installed options, such as: Additional dealer markup (ADM) Additional dealer profit (ADP) Dealer preparation Undercoating This price is usually on a supplemental sticker.

Edmunds.com - http://www.youtube.com/watch?v=toqlk4g QzNs Negotiating your best deal http://www.youtube.com/watch?v=zsxh7px 5f34

Is leasing a smart option for obtaining a car? List pros and cons

Leasing is an alternative to buying a vehicle Most expensive way to acquire a car Advantages: Low down payment Smaller monthly payment Disadvantages: Two to Three years of payments You own nothing and have nothing to trade in toward you next vehicle

Your leasing rights: Drive it for an agreed-upon number of months and miles Turn it in at the end of the lease, pay any endof-lease fees and charges, and walk away Buy the vehicle if you have a purchase option Take advantage of any applicable warranties or recalls

Consumer Leasing Act is a federal law Requires business to give you all terms of lease Allows you to compare different leases or leasing vs. buying Federal Law regulates advertisements of leases When certain trigger terms are used, must disclose additional information.

https://www.youtube.com/watch?v=gogtw5i RK6k

How to find the best used car deals http://www.today.com/video/today/51731038 #51731038

List the options for purchasing a used car List pros and cons

Many ways to purchase: New car dealer Used car dealer Car rental company Private party Auctions Online

Dealers Used Car Dealership Large selection Usually no facilities to service the car after you purchase it New Car Dealerships Sell traded in cars Have service facilities

Dealer gives implied warranty vehicle is merchantable Warranty of merchantability warrants that the vehicle is fit for ordinary purposes for which such vehicles are used All implied warranties are excluded by expressions such as as is

FTC s Used Car Rule All used car dealers must place a large sticker called a Buyer s Guide in the window of all cars for sale Buyer s Guide specifies any warranty and the protection provided States if there is no warranty as is Suggests car should be inspected by your own mechanic

Possible to find lowest price for a car Car is as is No recourse if something goes wrong Courts have held that a statement by a seller that a car is in good condition and runs properly amounts to an express warranty

Before you buy: Inspect the vehicle carefully or have it inspected by a mechanic Test-drive the vehicle Ask for the vehicle s maintenance record Talk to previous owners Ask to see the certificate of title How to buy a used car http://www.howcast.com/videos/447-how-to- Buy-a-Used-Car

Rental companies buy fleets of new vehicles Sell them when they are one or two years old Possible good buy Pros Usually will have regular maintenance Come with warranties Cons Likely vehicles have been heavily used Likely to have high mileage

UCC contract for sale of goods valued at $500 or more must be in writing to be enforceable Informal written contract X agrees to sell and Y agrees to buy Identify vehicle Signed Include price All info could be written on the deposit check (if there is one)

Repossess Bank or loan company has the right to repossess, or take back the car. Lack of payment Stolen car

Make-A-Wish - http://newjersey.wheelsforwishes.org/make-a-wishcar-donation/?_vsrefdom=adwords&gclid=cjx0ppnh47wcfrpxogodghmazg Kars-for-Kids - http://www.nbcnewyork.com/investigations/kars-for- Kids-Cars-4-Kids-Real-Estate-Investments-Investigation-140955003.html Tips on donating a car or boat to charity http://www.today.com/id/26625209/ns/today-money/t/how-donate-car-or-boatcharity/#.uwq2vtfy3fs http://www.outreachcenter.com/ourmission.htm

List what you think lemon laws cover Why are lemon laws necessary?

Some cars, new or used, continually have mechanical problems If that is the case, notify the seller immediately Ask the seller to either fix the problem, pay to have it fixed, or give your money back

Depending on the circumstances, seller may be liable on any of the following grounds: Breach of an express warranty, if specific guarantee was made Breach of warranty of merchantability, if the seller was a dealer and the car was not fit Fraud or breach of an express warranty, if the seller made any statements that were not true Breach of the state consumer protection law, only for non-business use

Revoking the Acceptance if car doesn t conform to the contract Notifying the Seller about Defects buyer must notify seller within a reasonable time, failure to notify could nullify your right to recover

Lemon Law Know You re Rights https://www.youtube.com/watch?v=jeejfbnsvp0 Top 4 Lemon Law Complaints 2012 https://www.youtube.com/watch?v=qysc37lbyz E 2013 Car Complaint Index http://www.lemonlaw.com/carcomplaintindex.ht ml

It is illegal for a vehicle owner to turn back or disconnect the odometer Federal odometer law requires a written mileage disclosure statement If seller believes mileage reading is incorrect, must indicate mileage is unknown Buyers may sue anyone who violates the odometer law To recover, you must prove the violation was committed with the intent to defraud

State of New Jersey Motor Vehicle Commission You need a license to run an auto body repair facility. MVC issues different auto body repair licenses based on the types of repairs the facility will perform: Full service Auto body limited Auto body new dealer sublet A heavy duty vehicle endorsement is required for all licensed auto body repair facilities repairing vehicles weighing 14,000 pounds (GVWR) or more. http://www.state.nj.us/mvcbiz/businessservices/autobod yrepair.htm

All vehicles registered in New Jersey require three types of mandatory insurance: Liability insurance pays others for damages that you cause if you are responsible for an accident. It does not cover medical expenses Personal injury protection (PIP) pays medical expenses if you or other persons covered under your policy are injured in an automobile accident. Often called No Fault coverage, it pays your medical expenses if you were or were not at fault Uninsured motorist coverage protects you if you are in an accident with someone who doesn t have proper insurance coverage

Bodily Injury Coverage Bodily Injury Liability Medical Payments Coverage Uninsured Motorist s Protection Property Damage Coverage Property Damage Liability Collision Comprehensive Physical Damage

Type of Insurance Bodily Injury Liability Property Damage Liability Collision Comprehensive Medical Payments Uninsured or Underinsured Motorist What it Covers Injuries to other persons if the insured is at fault. Damage to the car(s) or property of others if the insured is at fault. Damage to the insured s car. Loss or damage to the insured s car caused by fire, flood, storm, theft, or vandalism. Medical expenses incurred by anyone occupying the insured s car. Injuries to the insured if another is at fault and has little or no insurance or the insured is involved in a hit-and-run accident.

No-fault insurance Regardless who caused the accident, all drivers involved collect money from their own insurance companies

When a New Jersey driver is involved in a crash, the driver turns to his or her own auto insurance policy first to pay medical bills and other expenses related to the crash. Drivers may sue one another in court after an accident only in limited cases. New Jersey drivers have the option of choosing between no-fault and traditional car insurance at the time they purchase their policy.

The traditional coverage option allows one driver to file a liability claim against (or sue) another driver for the full range of damages after an accident. For drivers who choose the no-fault option, a lawsuit is only possible in New Jersey if the accident resulted in dismemberment; significant disfigurement or significant scarring; displaced fractures; loss of a fetus; or permanent injury (other than scarring or disfigurement).

Should driving be a right or a privilege? Have you driven with an unsafe driver? How did or will you handle it?