FTC Used Car Rule Buyer’s Guide Requirements for California Dealers
The FTC Used Car Rule Buyer’s Guide requirements apply to nearly every California retail used-car dealer. Understanding who must post a Buyer’s Guide, what it must say, and how to document it is essential for passing the CA DMV dealer test and staying audit-ready.
Who Must Post the FTC Buyer’s Guide
Under the Federal Trade Commission’s Used Car Rule (16 CFR Part 455), a Buyer’s Guide must be displayed on every used vehicle offered for retail sale by a dealer. This includes vehicles on your lot, on consignment, at off-site sales events, and at auctions open to consumers.[FTC Used Car Rule]
The rule generally applies when:
- You regularly sell or lease used vehicles to consumers.
- The vehicle is offered for personal, family, or household use.
- The vehicle meets the size and weight limits described below.
Scope and Key Exemptions
The Used Car Rule covers most used passenger vehicles with:
- Gross Vehicle Weight Rating (GVWR) of 8,500 pounds or less, and
- Curb weight under 6,000 pounds.[FTC Dealer’s Guide]
Vehicles and Sellers Exempt from the Rule
You do not have to post a Buyer’s Guide for:
- Motorcycles.
- Off-road and farm equipment.
- Vehicles sold strictly for scrap or parts under a salvage certificate.
- Dealers who sell fewer than six used vehicles in a 12‑month period.
- Private-party (non-dealer) sales.[FTC Dealer’s Guide]
Most licensed California retail used-vehicle dealers will not qualify for the “fewer than six” exemption and must treat the Buyer’s Guide as a standard part of every used-vehicle deal.
Required Buyer’s Guide Content
The FTC provides standard Buyer’s Guide forms that must be used. The current version includes these main elements:[FTC Dealer’s Guide]
1. As Is or Dealer Warranty
- As Is: If you do not provide a warranty, you must check the “AS IS” box and the Guide must state: “DEALER DOES NOT PROVIDE A WARRANTY FOR ANY REPAIRS AFTER SALE.”
- Dealer Warranty: If you provide a warranty, you must:
- Check “FULL” or “LIMITED”.
- Describe what systems are covered.
- State how long the coverage lasts (time and/or mileage).
- Explain what portion of repair costs the dealer will pay.
2. Non‑Dealer Warranties
You must indicate any non-dealer warranty protection that still applies, such as:
- Manufacturer’s warranty still in effect.
- Certified pre‑owned or “used vehicle” warranties.
- Any other third‑party warranty.
3. Service Contract Availability
The Guide must say whether a separate service contract (extended warranty) is available for purchase. If you offer service contracts through your dealership or a third party, this section must be properly checked and, where applicable, explained.
4. Major Defects List
The back of the Buyer’s Guide contains a standard list of major defects that may occur in used vehicles. This list must include important safety-related components such as airbags and catalytic converters, along with engine, transmission, electrical, and other key systems.
5. Consumer Advice and Recall Information
Current FTC Buyer’s Guides also include consumer tips, such as:
- “Get a vehicle history report—visit ftc.gov/usedcars.”
- “Check for safety recalls at safercar.gov.”[FTC Dealer’s Guide]
Dealers should be ready to answer basic questions about recalls and can direct consumers to the National Highway Traffic Safety Administration’s VIN lookup tool to check for open safety recalls.[NHTSA Recall Lookup]
Bilingual and Language Requirements
The Used Car Rule requires that you provide the Buyer’s Guide in the same language as the sale is conducted.[FTC Dealer’s Guide]
- If you negotiate a sale primarily in Spanish, you must use the Spanish‑language Buyer’s Guide.
- If you use another language offered by the FTC form set, post the Guide in that language for those negotiations.
California law also requires that if a vehicle sale is negotiated primarily in certain languages (including Spanish, Chinese, Korean, Tagalog, or Vietnamese), the dealer must provide a written translation of the contract in that language before the buyer signs. For Spanish transactions, a Spanish Buyer’s Guide must be displayed on the vehicle before negotiations begin.[Cal. Civ. Code §1632]
Posting and Display Rules
Your posting practices are a visible sign of compliance. The FTC requires that the Buyer’s Guide be displayed on the vehicle before you offer it for sale or allow a consumer to inspect or test-drive it.[FTC Dealer’s Guide]
Where and How to Attach the Guide
Attach the Guide so both sides are easy for shoppers to read without entering the vehicle. Common locations include:
- Hanging from the rearview mirror in a clear sleeve.
- Clipped to a side window facing out.
- Affixed under a windshield wiper in a weather‑resistant holder.
The key is that buyers can easily see the warranty terms and consumer information from outside the vehicle.
Test Drives and Temporary Removal
The FTC allows you to temporarily remove the Buyer’s Guide for a test drive, but you must promptly put it back on the vehicle once the test drive ends. Failing to reattach the Guide is a common, avoidable compliance problem.
Buyer Acknowledgment and Sale Documents
When the vehicle is sold, the Buyer’s Guide should be removed from the window and incorporated into the deal file. Best practice is to:
- Have the buyer sign and date the back or a separate acknowledgment line stating they received the Buyer’s Guide.
- Ensure the Guide’s terms match the warranty language in the retail installment sale contract and any separate warranty or service‑contract documents.
- Give the buyer a copy of the completed Buyer’s Guide along with their contract copies.
Although the FTC does not require a specific acknowledgment format, obtaining the buyer’s signature helps prove that the correct Buyer’s Guide was provided.
Recordkeeping and Deal File Practices
Solid recordkeeping is your best defense in an FTC or DMV audit. Incorporate these steps into your standard deal checklist:
- Keep a copy of the completed Buyer’s Guide, signed by the buyer, in the deal jacket.
- Ensure the “As Is” or warranty choice on the Guide matches the warranty box on the sales contract and any separate warranty forms.
- Document any non‑dealer warranties or service contracts sold, including provider and term.
- Retain sample blank English and Spanish Buyer’s Guides in your compliance binder to show you are using the current FTC version.
California dealers are already required to maintain complete deal files and records for DMV and tax purposes; integrating the Buyer’s Guide into that system streamlines compliance.[CA DMV Dealer Licensing]
Common Compliance Pitfalls
Dealers preparing for the CA DMV dealer test – and those operating day-to-day – should watch for these frequent mistakes:
- No Guide displayed on a vehicle that is being shown or test‑driven by a consumer.
- Outdated form that does not include the latest FTC language on vehicle history reports and recalls.
- Language mismatch: Negotiating in Spanish but using only an English Buyer’s Guide or failing to provide a Spanish contract translation when required.
- Warranty inconsistencies: The Guide says “As Is” but the contract or advertising promises a warranty (or the reverse).
- Missing deal-file copy of the completed Buyer’s Guide, making it hard to prove what was disclosed.
- Incorrect defect list: Using custom forms that do not contain the full major-defects list required by the FTC.
Practical Checklist for California Retail Dealers
Use this quick checklist to keep your store compliant with the FTC Used Car Rule Buyer’s Guide requirements:
- Verify that every used vehicle within scope has a properly completed Buyer’s Guide before it is shown to any customer.
- Confirm that the correct language version (for example, Spanish) is posted when negotiations are conducted in that language.
- Train sales and lot staff to reattach the Guide immediately after every test drive.
- Update forms when the FTC changes its Buyer’s Guide and discard older versions.
- Require a signed Buyer’s Guide (or acknowledgment) in every deal file.
- Periodically audit your lot to ensure all displayed vehicles have visible, accurate Guides.
By building these steps into your standard operating procedures, you protect your customers, reduce legal risk, and show the professionalism that regulators and lenders expect from California retail dealers.
