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Question: Does the owner of a used car have to tell the dealer about problems in a used car that have not been fixed, when trading in a used car toward a new or newer car purchase? Or is it up to the dealer to figure it out and make an offer.
For example, let's say you were having transmission problems and an independent mechanic (or a different dealer) said it would cost $2000 to fix, and you decided not to make the repair and instead to trade it in and get a new (or (newer) car. What obligation (if any) do you have as the owner to divulge the problems to the dealer that the problems haven't been fixed on your trade-in?
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Originally Posted by olderandwiser456
Question: Does the owner of a used car have to tell the dealer about problems in a used car that have not been fixed, when trading in a used car toward a new or newer car purchase? Or is it up to the dealer to figure it out and make an offer.
For example, let's say you were having transmission problems and an independent mechanic (or a different dealer) said it would cost $2000 to fix, and you decided not to make the repair and instead to trade it in and get a new (or (newer) car. What obligation (if any) do you have as the owner to divulge the problems to the dealer that the problems haven't been fixed on your trade-in?
Dealers that take trades have mechanics on site that they can use to evaluate the condition and help determine the value. If they choose not to, and you don't mention it it's their own fault if they get stuck doing major repairs. If this is a mid-level vehicle over about 8-10 years old with 150,000 miles, they will probably just auction it anyway. If it's a later model, low mileage car they will probably drive it, discover the problem and deduct $2,000 or more from the value to cover the cost of a rebuild. I have seen cases where a dealer would come back and ask for more down payment due to a problem with a trade discovered later, but it was something like a salvage title discovered when they did the paperwork.
Just make sure there is no "out" for them on the trade paperwork, like wording of "estimate" or "may be reduced after full evaluation is done."
Yeah a trade-in at a traditional dealer there is usually no disclosure from you. But at Carmax I recall filling out a form that asked if there were any problems.
I was trading a 1998 Pontiac Bonneville SSEi in on my current driver (05 Magnum R/T). The check engine light had been coming on quite a bit in the Pontiac, so I got to the dealer, got my stuff out of the car, and locked the keys in the car!
I figured that would give me some time to sign the papers and get the heck out.
Question: Does the owner of a used car have to tell the dealer about problems in a used car that have not been fixed, when trading in a used car toward a new or newer car purchase? Or is it up to the dealer to figure it out and make an offer.
For example, let's say you were having transmission problems and an independent mechanic (or a different dealer) said it would cost $2000 to fix, and you decided not to make the repair and instead to trade it in and get a new (or (newer) car. What obligation (if any) do you have as the owner to divulge the problems to the dealer that the problems haven't been fixed on your trade-in?
If they ask you a question and you give them any answer that's not truthful, may be different.
It they ask and you lie, they could come back to you. If they do not ask, it is as is.
If your car is old enough to have transmission problems, they are probably just going to junk it or wholesale it.
Sometimes a dealer will give you money on a worthless car in trade in order to get the new car sale. I had a worthless car that had all sorts of problems. A dealer offered me $2700 for it on a trade. I was concerned they might sell it to some hapless Joe or Joanne and stick them with a mess, so I asked. They said they would junk it. They offered the money on the trade, because they really needed the sale to get a bonus for selling a certain number of the car I was buying in a month or a quarter. Thus my sale was critical. Since I was buying on a GM employee plan that didn't allow them to negotiate price, they beat the other dealership by offering me more on my trade. That got them their bonus, which was a lot. Lucky for me I was buying on he last day of the month or quarter.
Dealers that take trades have mechanics on site that they can use to evaluate the condition and help determine the value. If they choose not to, and you don't mention it it's their own fault if they get stuck doing major repairs. If this is a mid-level vehicle over about 8-10 years old with 150,000 miles, they will probably just auction it anyway. If it's a later model, low mileage car they will probably drive it, discover the problem and deduct $2,000 or more from the value to cover the cost of a rebuild. I have seen cases where a dealer would come back and ask for more down payment due to a problem with a trade discovered later, but it was something like a salvage title discovered when they did the paperwork.
Just make sure there is no "out" for them on the trade paperwork, like wording of "estimate" or "may be reduced after full evaluation is done."
Excellent post. I bought the car new, so not a salvage issue. 9 years old, low mileage (75,000), just bad luck. I can't remember all of the mechanic's explanation, it was a while ago, but I think he said it needed a new clutch and some other transmission work, around $2,000 total. It actually still drives ok, but the clutch does chatter some of the time, on it's way out apparently. Thank you for mentioning the "estimate" issue. I would hate to make a deal, and then have the dealer come back and "adjust" the trade in value lower.
Once the paperwork is signed and the title transferred, I don't see how they could come back. I would not sign paperwork on an "estimate" for a trade-in. It's either a final offer or I walk away.
Last edited by olderandwiser456; 03-14-2017 at 08:36 PM..
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