Auto Purchases

Remember: Arizona does NOT have a “cooling off” period or three-day right to cancel a car sale.



Beware of advertised minimum trade-in amounts. Dealers may have already greatly raised the price of the car that you are buying to offset the value of your trade-in or lower values based on mileage or condition. Also, any debt still owed on a trade-in will be added to your new loan.

Be skeptical of car advertisements and always read the fine print. Sometimes, the advertised deal only applies to a few vehicles and is available only under certain conditions. Dealers may advertise prices that include rebates not available to most consumers (such as military, student or only with dealer financing)

Watch out for prizes or lotteries. Dealers often design contests to bring you into the dealership. Although you may think you have a good chance of winning a valuable prize, almost all customers receive the lowest value prize available, and some leave with an unwanted new vehicle.

Before You Go To The Dealer

Do your homework.

  • Ask family or friends for dealership recommendations.
  • Check with the Better Business Bureau or online review sites for dealer reviews.
  • Know what you want and what it should cost before you visit a dealership. Use a library or the Internet to get an idea of a price range and options before you go.

Determine Car Financing Options.

  • Car loans that were traditionally offered for 3 or 4 year periods may now last for 6 years or more.  Even a loan with a low monthly payment may add up to an inflated purchase price.
  • Calculate exactly how much you can afford in terms of price and then figure out what monthly payments fit that budget. People who go to dealers without such knowledge and who then negotiate based solely on what they can pay per month usually end up paying more over the life of the loan.
  • Arrange vehicle financing with your bank or credit union before you go car shopping. Pre-qualify with the bank or credit union that gives you the best deal. If you have an account with the lender, many will pre-qualify you over the phone.

Negotiating The Deal

Everything is negotiable – no matter what the salesperson says.

  • Never buy a new car in a hurry. Visit several dealerships to look at inventory and prices before talking to any salesperson. Be prepared to take as long as several weeks to find and negotiate the deal you want.
  • Be cautious when the dealership takes your car keys to “evaluate your trade-in” or for any other purpose.  It is often difficult to retrieve your keys and car.  This strategy may be used to pressure you to purchase a new car.  You may have to be very insistent about getting your keys back and leaving.
  • Take someone with you. They can take notes while you ask questions. Two people are also better able to withstand high-pressure sales tactics than a person alone.
  • Consider selling your paid off used car on your own, rather than trading it in at a dealership, where it can add to the complexity of the deal.
  • Make buying your new car, selling your old car, and financing your new car three separate transactions.
  • Always make the dealer’s invoice price the starting point for your negotiations. Don’t start with the car’s MSRP.
  • Don’t assume salespeople are your friends, no matter how friendly they act. Their job is to sell you a car. Most are paid on a commission basis, so their compensation increases the more you spend.
  • Take a notebook, calculator, and pen or pencil. Use them!
  • You do not have to agree to pay for after-market add-ons or treatments offered by the dealer, such as window etchings, fabric protection or rust-proofing, even if they are already on the vehicle you wish to purchase. Examine the cost and need for such extras and whether you can afford it. Some add-ons are unnecessary or are significantly overpriced, and they may greatly increase the price or cost of your overall financing.
  • Negotiate on an “out-the-door” basis. Explain that you want to know the dealer’s total price and the total cost to you.  If you don’t, you’ll likely agree on a price and learn later that it’s the dealer’s “policy” to add fees for “document processing,” weatherproofing, safety inspections, dealer “prep,” destination charges, etc.
  • Remember, if you still owe money on your trade-in, the amount that you still owe will most likely be included in the financing for the new car, and this will raise the overall cost of the vehicle you are buying.
  • Once you have agreed on a price with a dealer, make written notes of what the agreement is and compare your number to the figures that appear on the contract. Make sure your notes include the cost of each item. Some dealers will try to change the deal later without you noticing.

Closing the Deal

  • At every point in the negotiations, be prepared to walk away. It’s your ultimate (and often your only) weapon.
  • Give yourself at least 24 hours to think about a deal before signing a contract. You will not lose a new car deal, and there is only a remote chance you will lose a used car deal. If you do, there are lots of similar deals out there.
  • Make sure that ALL promises made by the salesperson or dealership are in writing.
  • Do not let a salesperson rush you to sign paperwork without reviewing the contract terms. Read all documents and understand all terms before signing on the bottom line.
  • If a contract has terms substantially different from what the salesperson initially promised, do not sign the contract unless you are willing to accept the new terms.
  • DO NOT allow false information on any forms and beware of a salesperson who suggests putting false information on your finance application, such as stating a higher income. While financing may be approved, the payments may be difficult for you to make. If something goes wrong, the false information could be held against you.
  • After you’ve agreed on a deal with the sales department, you’ll be taken by the salesperson to the finance representative and told that he or she will “fill out the paperwork.” Watch out – in some dealerships the finance representative will not use the price you agreed to with the salesperson and will almost always attempt to sell you additional costly products and services.
  • Be very careful what you sign. Don’t sign anything that contains blank spaces – especially on any contracts or credit applications. Draw a line through all blanks on documents you sign.
  • You may be encouraged to take the new or used car home before financing is approved. This practice is called “spot delivery” and is designed to “lock you in” to a purchase.  It is legal, but can result in problems later if the financing is not approved.
  • Never buy life or disability insurance from a dealer without comparison shopping with an insurance agent first.

Financing Through The Dealer

  • When financing through a dealer, always negotiate the car price separately from the financing. Once the price is settled, then negotiate the monthly payment amount, term of the loan and interest rate.
  • Always ask the dealer if the interest rate being offered is the lowest rate he or she can offer and whether it includes a profit for the dealer.
  • A dealer may let you take the car before financing is approved, a method often referred to as “spot-delivery.”  Beware, if the dealer cannot get the financing approved on the agreed upon terms, they may ask you to re-sign the contract for a higher rate or longer term.  Arizona law provides that you may reject the change in terms and the dealership must return your trade-in to you.  It may not be made clear why the dealer needs you to “re-sign” documents. Pay close attention to any change in the contract or financing terms.  Arizona’s spot-delivery law may be found at A.R.S. § 44-1371.

Service Contracts and Extended Warranties

Service contracts or extended warranties provide for the repair of certain parts or problems. These contracts are offered by manufacturers, dealers or independent companies.

When deciding whether to purchase a service contract or extended warranty, consider the following questions:

  • Who is the provider of the coverage?  Is it a manufacturer’s policy or offered by a private company that may be unreliable or go out of business? 
  • Used car service contracts may count the mileage or time period from the time the car was new—for example, the purchase of a 75,000 mile extended warranty on a used vehicle with 40,000 miles is only in effect for the remaining 35,000 miles.  Pay careful attention to the fine print concerning the time and mileage period covered.
  • What is the difference between the coverage under the manufacturer’s warranty for the vehicle and the coverage under the service contract or extended warranty? Most new vehicles already come with at least a 3-year or 36,000-mile warranty. 
  • Should I purchase this coverage now, or can I wait until later when I can comparison shop and put some time into reviewing the offer?
  • What repairs are covered?  Routine maintenance and wear and tear are probably excluded.
  • Who pays for labor? Who pays for parts?
  • Who performs the repairs? Can repairs be made elsewhere or only at the dealership where you made the purchase?
  • Most of these policies can be cancelled for a pro-rated refund.  You should cancel as soon as possible if you decide the purchase of the policy was unwise or overpriced. 
  • If the cost of the policy was financed, cancelling the policy may not lower your monthly payments, although it can reduce the total amount of money you owe and shorten the term of your loan.

Your Warranty Rights Under Federal Law

When purchasing a new vehicle, as a consumer you have certain rights under the Magnuson-Moss Warranty Act.  The Act, which was passed by Congress in 1975, establishes requirements for entities that provide warranties, including automobile manufacturers.  Under the law, the warranty must be available to you before you make the purchase.

What is a warranty? 

A warranty is a promise by a manufacturer to stand behind its product or to repair certain defects over a set period of time. The warranty covers the costs associated with repairs or replacements specified in the agreement (or promise) during this period.

What are your rights under the Magnuson-Moss Warranty Act?

As a consumer, the Magnuson-Moss Warranty Act provides you with the flexibility to choose your own mechanic or retail chain shop for auto repairs and maintenance.  In other words, you cannot be denied warranty coverage on your new vehicle just because you had maintenance or repairs done by someone other than the dealer.  However, the manufacturer or dealer may require consumers to use select repair facilities if the repair services are provided to consumers free of charge under the warranty. 

Similarly, you cannot be denied warranty coverage for using “aftermarket” or recycled parts unless the manufacturer or dealer requires specific parts that are provided free of charge under your warranty.  The manufacturer or dealer may also deny coverage if it can demonstrate that the use of your own mechanic or aftermarket parts caused the damage in a warranty claim.

When purchasing a new vehicle, what should you do to avoid warranty issues?

• Ask to read the warranty prior to finalizing your purchase.  If you have questions, ask the dealer for clarification.

• Be aware of the warranty period.  If issues arise, get them checked before your warranty expires.

• Keep up to date with service and follow the manufacturer’s recommended schedule.  A manufacturer may void a warranty for failure to service your vehicle.

• Keep all service records.  If you ever need to use your warranty, the dealer or manufacturer may request your maintenance records.

You can find more information on the Magnuson-Moss Warranty Act at

If you believe your warranty claim has been unfairly denied, file a complaint with our office at

Additional Tips For Used Cars

Most of the issues already discussed apply to used cars as well as new cars.

If you buy from a dealer, request a free vehicle history report on a used car.

Have a trusted mechanic inspect the used vehicle before you buy. This may cost around $100 or more, but could save you money in the long run.

Check the vehicle's history. Instead of taking the salesperson's word about the history and condition of the vehicle, get a vehicle-history report from CarFax or Experian Automotive. Although these services are not fail-safe, they can alert you to possible odometer fraud; past flood, fire and accident damage; or whether a rebuilt or salvage title was ever issued for the vehicle. 

Used cars in Arizona are sold with an implied warranty of merchantability that applies to every used car sale (although a specific defect may not be covered if it is spelled out in writing). This law is found at A.R.S. § 44-1267. The implied warranty lasts fifteen days or 500 miles, whichever comes first. The dealer must be given two opportunities to repair the vehicle, before a consumer can seek a refund.

Arizona's Lemon Law

New Car

The Arizona Lemon Law has a number of specific provisions. You should read the law, consider filing a complaint with the BBB AUTO LINE Program ( or consult with an attorney if your new car is a lemon. Here are the basics:

The period covered by the Lemon Law is the term of the manufacturer’s warranty or two years or 24,000 miles, whichever is earlier. This covered period begins on the date of delivery of the vehicle to the consumer.

If there is a problem with the car that substantially impairs the use and value of the car and does not conform to the express warranty of the manufacturer, the consumer should report it to the manufacturer.

The report must be made during the covered period.

The manufacturer or its authorized dealers can repair or correct the defect, accept return of the car or replace the car with a new car.

There is a limit on the number of times a consumer must allow the manufacturer to repair the car and the amount of time the car can be out of service. If during the covered period, the manufacturer fails to successfully repair the defect after four attempts, or the car is out of service by reason of repair for a cumulative total of 30 or more calendar days, the manufacturer must accept return of the car or replace the car with a new car.

Used Car

Your car is covered by the Arizona Used Car Lemon Law if a major component of your car breaks before the earlier of 15 days or 500 miles after you buy the car.

If it breaks, you’ll still have to pay up to $25 for the first two repairs.

The recovery for the consumer is the purchase amount paid for the car.

Problems With Your Transaction

If your motor vehicle purchase involved deception or unfair practices that may have violated the Arizona Consumer Fraud Act, you should file a complaint with our office. All complaints are forwarded to the business for response and many are resolved. A pattern of complaints or egregious violations may lead to an investigation and/or lawsuit brought by the State against a business for Consumer Fraud.