Let’s talk about the Buyer’s Guide.
We’re going to talk about MOST federal regulations in section 4 of the pre-licensing course. However, we’re trying to get set up for our first sale and we need to get the Buyer’s Guide in the window of the vehicle. So, we’re going to talk about this particular federal requirement now.
As mentioned, this federal regulation is commonly referred to as the Used Car Rule or the As-Is sticker. You need to know that the Buyer’s Guide must be posted on all vehicles available for sale. The Guide must be in plain view – with both sides visible.
You can take the Buyer’s Guide down for test drives, but it must be returned when the vehicle is back on the lot.
If a deal is conducted in Spanish, then the Spanish language Buyer’s Guide must be posted and provided to the buyer. Many dealers who deal with both English-speaking and Spanish-speaking customers will post a Buyer’s Guide that is printed in both English and Spanish.
Importantly, the guide becomes part of the sales contract and overrides any contrary contractual provisions. The FTC offers some really good resources on their website.
If a vehicle is sold as-is, that means the buyer is assuming any risk that the vehicle is defective. However, this is not a get-out-of-jail-free card for a dealer to sell a vehicle that they know is defective. This is one of the most important points we’ll raise in the pre-licensing course!
If any deception or misrepresentation is used, a dealer may still be sued under the Texas Deceptive Trade Practices Act. That allows for THREE TIMES actual damages PLUS attorney’s fees and court costs. Your best defense against this type of lawsuit – even if you sell vehicles as-is with no warranty – is to disclose, disclose, DISCLOSE! Tell the customer everything you know about the condition of that vehicle and do it in writing!
If you sell vehicles with a limited warranty, know that the Buyer’s Guide itself doesn’t serve as the actual warranty. Under the Federal Warranty Disclosure Rule, the written warranty MUST be a separate document.
If you sell a vehicle as-is, use a separate Motor Vehicle Warranty Disclaimer form. We will cover this in our next chapter where we discuss the various documents required and recommended for your deal jacket.
Your customer is not required to sign the Buyer’s Guide. However, it is highly recommended that you have your customer sign the Buyer’s Guide.
If you do have your customer sign the Buyer’s Guide their signature must appear under this specific disclosure language “I hereby acknowledge receipt of the Buyer’s Guide at closing of this sale”.
And the signature line and required disclosure must appear in the space provided for the name of the individual to be contacted in the event of complaints after the sale.