The Federal Trade Commission is letting the public test drive its revamped Used Car Rule, but consumer groups say the commission's plan still isn't road worthy.
The Used Car Rule requires car dealers nationwide to put a Buyer's Guide – a big window sticker – on every used car so that potential buyers know whether the vehicle comes with a warranty or is being sold "as is."
The FTC proposed rule changes that would require dealers to indicate on the Buyer's Guide if they pulled a vehicle history report and, if so, advise consumers they can ask to see the report.
But vehicle history reports aren't all made alike – and consumer advocates say that's a problem.
"It could be the dealer's brother's vehicle history report," says Rosemary Shahan, president of Consumers for Auto Reliability and Safety.
Shahan says the FTC is ignoring the existence of the data-rich National Motor Vehicle Title Information System, known for short as NMVTIS. By law, salvage yards and insurers have 30 days to report cars that are stolen, totaled or flood-damaged to the NMVTIS database. If they don't, they face penalties.
The national database was created to help protect consumers from fraud or danger when they buy cars, because prompt reporting is required, the database often captures important information about branded cars before it gets to commercial car history reports. Some commercial reports include NMVTIS data.
California state law requires dealers to check NMVTIS reports – and put warning stickers -- on used cars that have been branded.
The salvage vehicle reporting program filed comments urging the FTC to require dealers to include either NMVTIS reports or commercial reports that contain NMVTIS data to car buyers and – on the day of sale before a purchase is completed – provide consumers with a current copy so that consumers have important up-to-date information about a car before they drive it off the lot.
"There are entities out there that buy cars knowing they have a defect on them from the auto auctions and then turn very quickly," says Ron Frederick, a Cleveland consumer attorney who handles car cases. "They present (old) CarFaxes to people that don't show the damage."
Frederick says consumers, who often aren't savvy about such things, shouldn't have to ask for reports a dealer pulled. "It should be a required disclosure prior to having them sign any document," he says.
John Van Alst, an attorney with the National Consumer Law Center, says the FTC also should require dealers to alert a consumer if a used car was recalled for safety defects, but never repaired -- information that's readily available through a free database kept by the National Highway Traffic Safety Administration.
Manufacturers foot the bills for recall-related repairs, he said, and having a warning would, at minimum, let consumers know if the car they're about to buy has a serious safety issue.
Despite their reservations about the FTC's current proposal for changing the Used Car Rule, consumer groups say the agency has improved on its 2012 proposal, which consumer groups branded a lemon.
In the current proposal, the commission tweaked some troublesome language about "as-is" car sales. Consumer groups say they continue to submit alternative language they think would help consumers both understand the risks of "as is" sales and their rights.
Several states, Ohio is not among them, have outlawed "as is" car sales, which can leave consumers on the hook for repairs. Ohio consumer law prohibits dealers from misleading consumers about the condition or reliability of a car, but "as is" sales can be trickier to challenge in court, Frederick said.
The FTC unveiled its latest proposal just before the holidays, but this week, it said it was extending the deadline for public comments to March 17. You'll find links to the proposed rule and comment forms at https://ftcpublic.commentworks.com/ftc/usedcarrulesnprm/.
In the meantime, consumers shopping for used cars should:
- Check dealers' reputation through the Better Business Bureau,
- Take a used car to an independent mechanic before you agree to buy. Mechanics charge for inspections, but they can save you money in the long run by helping you spot serious mechanical problems.
- Check to see if a car you're planning to buy (or currently own) needs safety recall-related repairs by plugging its VIN into the free National Highway Traffic Safety Administration-run site,
- Consider spending the nominal fee to get a NMVTIS report on a used car to make sure it wasn't salvaged, totaled or flood-damaged. Find NMVTIS reports at
- Ask a dealer to provide a current vehicle history report on a car before you buy. You can also purchase vehicle history reports yourself – and commercial reports have a lot of useful information in addition to the data on NMVTIS reports.
- Read the Buyer's Guides on used cars. If you buy the car, keep the Buyer's Guide with your purchase documents.
- Read and make sure you understand all documents before you sign them. Don't be rushed.
- Check the FTC's used car shopping tips at