Don't just assume you will finance through the dealer. Sometimes, you can get better financing from your bank or credit union. You should also check your credit score before you go shopping as this can affect the terms such as the interest rate you are offered. By shopping around, you may be able to negotiate a better deal. Note that Texas law sets maximum interest rates for financing used cars. The rates vary according to the age of the car and the amount owed on it.
All used car dealers are required by federal law to tell buyers whether a used car is being sold with or without a warranty. Dealers must clearly display this information on a side window of each used car. This buyer's guide, or window form, should state either:
Under Texas Law, you do not have 3 days to cancel the purchase like you may with some transactions the dealer is required to register and title the vehicle in your name within 30 days, regardless of if you owe money on the vehicle to the dealer or another financier. As soon as the vehicle is registered in your name, the dealer should provide you with the original title application receipt from the Tax Assessor-Collector's office.
If you buy your vehicle from a dealer, the dealer is required to file the title application on your behalf, so you will not have to visit the tax office. Make sure the dealer provides you with a receipt showing the vehicle has been titled in your name.
If buying from an individual, have the seller accompany you to the county tax office to avoid unwanted surprises. Before submitting the title application, a tax office representative can tell you if the title being signed over to you is correct and if it has any salvage or legal issues. You can also use Title Check to see if the title of the vehicle you are thinking about buying has any issues impacting its value.
If buying from an individual, a motor vehicle sales tax (6.25 percent) on either the purchase price or standard presumptive value (whichever is the highest value), must be paid when the vehicle is titled. The title, registration and local fees are also due. Contact your county tax office to estimate the amount of sales tax due and to learn which forms of payment are accepted. Acceptable forms of payment vary by county.
When you shop for a new or used car, CoPilot helps you know more. We search every car at every dealer so you don't have to, we give you data and insights you won't find anywhere else, and we rank every car so it's easy to find the best car at the best price.
Yes. You must have auto insurance to purchase from a dealer, but you are not required to buy insurance from them. You can shop around for your insurance. You must also have proof of insurance to register the car in your name.
No. Regardless of your credit, you are not required to finance the car through the dealer. You are entitled to arrange your financing separately. You are also not required to buy credit insurance from the dealer. If you do, it must be disclosed in the Retail Installment Contract.
PrivateAuto has a generous selection of used cars for sale in Austin, Houston, Dallas, El Paso, and elsewhere across the state of Texas. We offer security and convenience features no other competitor has, from in-app test drive scheduling to instantaneous funds transfer of any amount.
Before buying a used car, you may want to perform a mechanical inspection on it. This is especially advisable for cars that have high mileage. If you are experienced enough, you can perform the pre-purchase inspection at the test drive. Or, you can get it inspected by a professional mechanic.
When buying a used car, always check the vehicle identification number (VIN) that the seller has written on the title. Carefully compare it to the actual VIN on the car. You want to avoid the problem of having the wrong vehicle information number on the title when you go to register your newly-bought car with the State of Texas.
Oh, and if you didn't want to pay out-of-pocket for your next vehicle, you can apply for a used car loan right within the PrivateAuto app. Once you get approved, your profile will show that you have verified funds, making you stand out from other buyers.
Any Texas attorney will recommend using the National Insurance Crime Bureau website to research the title of a potential used vehicle purchase to protect yourself from fraud. It doesn't happen often, but sometimes sellers will attempt to mislead or outright deceive. For instance, they may try to pass off a salvage title as a clean title.
Different states will have different regulations for license plates in car sales. Some states allow the plates to remain with the car and pass on to the buyer. Sadly, Texas is not one of those states. When you buy a used car in Texas from a private owner, Texas laws mandate that the seller must remove the license plate from the car as well as peel off the registration sticker.
Most car dealers who sell used vehicles must comply with the Federal Trade Commission's (FTC's) Used Car Rule. In fact, car dealers who sell, or offer for sale, more than five used vehicles in a 12-month period must comply with the Rule. Banks and financial institutions are exempt from the Rule, as are businesses that sell vehicles to their employees, and lessors who sell a leased vehicle to a lessee, an employee of the lessee, or a buyer found by the lessee.
The Used Car Rule applies in all states except Maine and Wisconsin. These two states are exempt because they have similar regulations that require dealers to post disclosures on used vehicles. The Rule applies in the District of Columbia, Puerto Rico, Guam, the U.S. Virgin Islands, and American Samoa.
You must post a Buyers Guide before you display a vehicle for sale or let a customer inspect it for the purpose of buying it, even if the car is not fully prepared for delivery. You also must display a Buyers Guide on used vehicles for sale on your lot through consignment, power of attorney, or other agreement. At public auctions, dealers and the auction company must comply. The Rule does not apply at auctions that are closed to consumers.
Also known as a "doc fee," this is a charge the dealer adds to cover their expenses for getting a license and registration, or gathering the necessary paperwork. These fees can run anywhere from $50 to $600, with some states having a cap on how much a dealer can charge a buyer. Depending on where you live and the dealer, a documentation fee may be negotiable, so it can't hurt to ask.
Reconditioning is one of the most common hidden fees when buying a used car. When a dealer buys a used car, they inspect and run diagnostics on it to discover any maintenance issues. Then, once the vehicle is given the all-clear, they'll clean it to get it ready for the showroom. Some dealers may try to pass this cost on to you as a fee. It's something you can negotiate.
Guaranteed Asset Protection, or GAP insurance is a type of supplemental car insurance that helps cover the difference between the financed amount and the car's value if it was stolen or totaled. If you're underwater on your loan at the time of such an event, you may have to pay the difference. Some dealers may offer you GAP insurance as part of the buying process. If GAP insurance is something you want, check with your car insurance provider or shop around to see the prices and compare.
While it's not a hidden fee at the time of purchase, there's one more thing you should think about when shopping for a used car: research how much maintenance fees and repairs typically cost and how often they're needed. Some cars have higher reliability scores compared to others, and a lot of maintenance fees could add up over time. Ask your dealer about the typical service costs for the car you want so you can have a good idea when reviewing your expected expenses.
When you buy any car, whether new, used, or certified pre-owned, it's essential to carefully review the paperwork before you complete the deal. You always want to make sure the numbers you've run and been told by the dealer match what's in the official documentation. If they don't, ask for clarification before proceeding further.
Dealers will continue to be reimbursed for actual costs incurred in completing an inspection. If a used vehicle has a passing inspection at the time of transfer, a dealer is not required to re-inspect the vehicle. If a dealer does not re-inspect the vehicle, the customer should not be charged for an inspection.
For retail sales of new and used motor vehicles involving licensed motor vehicle dealers, the motor vehicle sales tax is based on the sales price, less any amount given for trade-in vehicle(s) and/or dealer discounts. For example, if a purchaser traded in a vehicle worth $15,000 to a licensed dealer as part of the purchase of a $42,000 vehicle, motor vehicle tax is due as follows:
If a car you buy turns out to be faulty, your rights and options largely depend on who you bought it from and how they described the car. You have less legal protection when buying from a private seller or from a car auction than when buying from a dealer.
Owning a vehicle can be one of the most liberating feelings in the world. The possibilities are endless once you have two or four wheels of your own. You can take road trips, drive to work, take the kids to soccer practice, or go on long shopping trips to your local grocery store to finally buy in bulk. Yet, sometimes things can go awry when purchasing a car or motorcycle. Texas auto dealer fraud laws are meant to protect consumers from deceptive and unlawful practices by dealers at any stage of the process. Below you will find key information about bait and switch, disclosure laws, odometer tampering, and much more.
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