Buying a Car

Remember, state law requires that all vehicles have current registration and insurance.
   Operating a vehicle without current registration, insurance, and a valid driver’s license, can result in tickets, fines, and seizure of your vehicle.

Buying a Car

Buying a car can be one of the most expensive purchases you will make. Therefore, it is important that you know how to make a smart deal in this often confusing and frustrating process.

Before you visit a dealership:

  • Determine what you can afford to spend (total or monthly, including auto insurance.)
  • Determine the type of car and options you want.
  • Arrange financing before you visit a dealership.   Check with your bank, savings and loan, or credit union to find the best interest rate.
  • Research prices and compare prices in ads, at dealer showrooms, on the Internet, and in consumer buying guides.
  • Find a reliable dealer. Ask friends and relatives for recommendations. Also, to see if the dealership you might want to do business with has complaints filed against them with the Attorney General's Office or with the Better Business Bureau.

Once shopping begins:

  • Test-drive the car on hills, highways, and in congested traffic (stop-and-go).
  • For insurance purposes most car dealerships will request a copy of your driver's license when you test-drive their vehicles.   Make sure to tell them that you do not consent to a credit check until you have decided to make a purchase.   Credit reporting bureaus record when lenders access your credit report. A large number of inquiries may lower your credit score.
  • Plan to negotiate on the price of the vehicle.   Dealers may be willing to bargain on their profit margin, often between 10 and 20 percent.
  • Examine the warranties.   Find out what parts, services, and costs will be covered.
  • Warranties are included in the price of the product while service contracts are not.
  • Be aware of extras like credit life, credit disability and extended warranties.   They increase the cost of the vehicle and are sometimes unlawfully added to your contract.
  • If you plan on trading in your old vehicle, know what it is worth.   Don't tell the dealer you have a trade-in until a price on your new vehicle has been reached.
  • Remember, don't let anyone pressure you into buying, signing, or agreeing to anything you do not understand or with which you are uncomfortable.

When considering a used car:

  • Look up the car's repair record, maintenance costs, safety and mileage ratings, and do a CARFAX® Vehicle History Report™.
  • If you are buying from a dealership be sure to look for the Buyer's Guide.   The Buyer's Guide will let you know more about the car you are thinking of buying.   You want all verbal promises to be written into the Buyer's Guide.   Make sure to obtain a copy of the dealer's warranty before you buy.
  • Ask for the car's maintenance record from the owner, dealer, or repair shop.
  • Have the car inspected by a third-party certified mechanic.

Used Car Lemon Law

The Motor Vehicle Quality Assurance Act, more commonly known as the “Lemon Law,” was amended to include used motor vehicle sales beginning on January 1, 2004. The “Used Car Lemon Law” applies to all used motor vehicles sold to any consumer by any New Mexico dealership. 

Key points of the “Used Car Lemon Law” are as follows:

  • Used motor vehicles can no longer be sold “AS IS.”
  • All used motor vehicle dealers are required by law to provide at least a 15-day/500-mile warranty on all used motor vehicles sold to consumers.
  • The 15-day/500-mile warranty period ends after the 15th day, or after 500 miles, whichever occurs first. In regards to time, the warranty period begins the day after you take possession of the vehicle and ends at midnight on the 15th calendar day after you took possession of the vehicle. Any day on which the vehicle fails to operate properly is excluded from the 15-day warranty period. In regards to miles, any miles driven to or from the dealership in connection with any repair, servicing or testing of the vehicle are excluded from the 500-mile warranty period.
  • If a problem that significantly limits the use of the vehicle occurs within the 15-day/500-mile warranty period, you need to inform the dealer within 30 days after the problem occurred.
  • If a problem that significantly limits the use of the vehicle occurs, you have to give the vehicle to the dealership you bought it from before any attempts to repair the vehicle are made. If you have the vehicle serviced by anyone but the dealership before the dealership has the opportunity to repair the problem, the dealership is no longer obligated to you under the “Used Car Lemon Law” for that problem.
  • If a used motor vehicle experiences a problem that significantly limits the use of that vehicle during the 15-day/500-mile warranty period, the dealer shall have the first opportunity to make a reasonable attempt to repair the vehicle. The dealer can charge up to $25.00 for each of the first two repairs required to bring the vehicle back into compliance with the law.
  • If the contract you entered into with the dealership does not include the “Used Car Lemon Law” disclosure in writing as required by law, you can cancel the contract, return the vehicle and get your money back. If you traded in your vehicle, you are entitled to get your trade in back as well.
  • If a problem arises in the 15-day/500-mile warranty period and the dealer refuses to honor the warranty as provided by the law, you can cancel the contract, return the vehicle and get your money back. If you traded in your vehicle, you are entitled to get your trade in back as well.
  • If you have given the dealer a reasonable opportunity to repair the vehicle and the dealer is not able to repair the vehicle, you may cancel the contract, return the vehicle and get your money back. If you traded in your vehicle, you are entitled to get your trade in back as well. 
  • If a used motor vehicle has been previously repurchased by an automobile manufacturer under the Motor Vehicle Quality Assurance Act’s “New Car Lemon Law,” written notice informing you that it was a “New Car Lemon Law” buyback must be given by the dealership to you before the sale is completed. 
  • Generally, the “Used Car Lemon Law” only applies to cars, pickup trucks, vans, or motorcycles, which have a gross weight under 10,000 pounds and which are sold by a dealer to a consumer for personal use.
  • The “Used Car Lemon Law” does not cover damage caused by the consumer to the vehicle, if the damage can be shown to be the result of: (1) off-road use; (2) racing; (3) towing; (4) abuse; (5) misuse; (6) neglect; (7) failure to perform routine maintenance; or (8) failure to maintain adequate oil, coolant or other required fluids or lubricants. 

A dealership can sell a used motor vehicle which has certain defects or mechanical problems, but only if those defects are disclosed to you, orally and in writing, before the sale is completed.    Therefore, you may waive the 15-day/500-mile warranty, but only for the defects disclosed to you andonly if all of the following conditions are met:

  • The dealer fully and accurately discloses to you that the used motor vehicle has particular defect(s).
  • You agree to purchase the vehicle after full disclosure of the particular defect(s)
  • Before the sale is completed, you sign and date a written disclosure statement that discloses the particular defect(s). 

To ensure that you are protected by the “Used Car Lemon Law,” it is best to keep track of the mileage and date(s) when any problem(s) occur and the date that you contacted the dealer to notify them of the problem.

New Car Lemon Law

The “New Car Lemon Law” provided by the Motor Vehicle Quality Assurance Act, applies to all new and demonstrator vehicles sold by any New Mexico dealership to any consumer. The “New Car Lemon Law” requires automobile manufacturers and their dealerships to repair any and all defects that substantially impair the use and market value of the vehicle purchased for a period of one-year after you took possession of the vehicle or when the manufacturer’s warranty expires,whichever occurs first. 

If, during the one-year period after you take possession of the vehicle or during the manufacturer’s warranty period, the same problem has been repaired four or more times or the vehicle has been in possession of the dealership a cumulative total of thirty or more business days due to that problem and the same problem is still present, the vehicle may be eligible for replacement or repurchase under the “New Car Lemon Law.”

Car Sales Negotiated in Spanish

If you buy a car and the sale was conducted and negotiated in Spanish, the Buyer's Guide window sticker must be provided in Spanish.   The dealer is not required to provide a Spanish-language contract, but the terms of the contract must be the same as the Buyer's Guide that was provided in Spanish.

Useful Web Sites for Buying a Car

  • To find the vehicles private party sales value or the manufacturer's suggested retail price (MSRP) of a vehicle go to sites such as Kelly Blue BookNADA, or Edmunds.
  • Consider paying for a Vehicle History Report™ from CARFAX. However, a vehicle history report from a database such as CARFAX® should not be substituted for an inspection by a certified mechanic and an automotive body shop.  Databases that provide vehicle histories rely on the accurate reporting of the incidents to which vehicles are subjected.  Oftentimes, a vehicle will sustain some sort of damage, and for some reason or another, the damage goes unreported to a MVD or insurance agency, causing an inaccurate or incomplete report of the vehicle's history, or request that the seller or dealership provide the CARFAX® Vehicle History Report™ to you.