If you are looking at buying a second-hand car, there can be considerable confusion as to what to expect in terms of a used car warranty and what your rights are when something goes wrong.
At one end of the spectrum, you will have cars advertised as still being covered by their new car warranty, while at the other end you will see cars being advertised and sold with no warranty given at all. In between is a bewildering variety of used car warranty offers which have different meanings and consequences for car buyers.
In this article, we will look at the different types of warranty offered on a used car and what protection you can expect – even if the car is sold without any warranty.
Your statutory rights on any used car
Many buyers confuse warranties with their legal rights, but they are two different things. Any used car purchase by a private individual from a trader is covered by the Consumer Rights Act 2015, which gives you recourse to reject the car if it is not as described or is faulty. You are also covered by the Road Traffic Act 1988, which says that it is an offence for a trader to sell an unroadworthy vehicle (unless the buyer has no intention of driving it on the road in its present state).
It does not matter whether the car you are buying is priced at £500, £50,000 or £500,000; if you are private individual buying a car from a trader then you are covered by the Consumer Rights Act. These rights cannot be waived in return for a discount or any other offer.
Although there is no specific legal description, a faulty car is generally considered to be a car which is not roadworthy and/or is not safe. Secondary issues, like a broken stereo or paintwork problems, are generally not acceptable reasons to reject a car under the Consumer Rights Act.
If you are arguing with a trader over a rejection and end up taking your case to court, the judge will take things like age and mileage into account when considering whether a fault is considered significant enough to reject the vehicle, so a ten-year-old car with 100,000 miles on the clock will be given considerably more leeway than a three-year-old car that has done 20,000 miles.
The key thing to remember if you are considering rejecting a used car is that:
“A car with a fault is not necessarily a faulty car” (The Car Expert, 2017)
Warranty on a used car
A warranty is a form of additional insurance cover against certain faults, over and above your statutory rights. It does not override or replace your rights under the Consumer Rights Act, but it covers a wider range of faults which would not be acceptable reasons for rejecting the car altogether.
There are a few different types of warranty which may apply to the used car you are buying, and it is important to know which applies to you.
New car warranty
A fairly new used car (less than three years old) will almost certainly still be covered by whatever is left of the manufacturer’s new car warranty. This is the best kind of warranty, as it is usually fairly painless to make a claim via a franchised main dealer. The car has to be serviced on time, every time, for the manufacturer’s warranty to be valid, but you don’t have to have the car serviced by a franchised dealer thanks to EU law. After Brexit, who knows?
Most manufacturers offer a three-year warranty on their new cars, but some offer more. Many also offer extended warranties at extra cost, but be aware that these may not offer the same terms and benefits as the original warranty.
Approved used car warranty
Main dealers of big brands will also usually have an “approved used car warranty” of some sort, usually for 12 months. These are often branded as a manufacturer warranty, but are mostly managed and underwritten by a third party insurer on behalf of the manufacturer or dealer.
Often this type of warranty has an attached requirement that the car has to be serviced by either the selling dealer or another franchised dealer for the warranty to be valid. This is enforceable, unlike the new car warranty, as the warranty is not actually provided by the manufacturer.
Aftermarket used car warranty
The majority of used car traders will offer some form of warranty on their cars, but the value of these warranties vary massively. Some are branded products offered in conjunction with a breakdown provider (like the AA or RAC), but again they are actually managed and underwritten by a specialist insurance company.
The term offered may be a week, a month, a few months or a year, and there will be very specific areas which are excluded from the warranty cover. There may be a specific process for claiming on the warranty; some will require you to get authorisation from the warranty company before proceeding, while others may require you to pay for any work up-front and then reimburse you afterwards if your claim is approved. There will also be a cap on how much money the warranty will contribute towards a repair, which may not cover the total cost of having your car fixed.
It is very important to read the fine print on any warranty, but especially so on an aftermarket product as the terms and conditions will vary significantly on different warranties. Much better to know how it works and what is covered before you have a problem then when you are standing in a garage arguing over who’s paying for your car’s repairs.
Older/higher-mileage/cheaper cars tend to be offered with warranties that cover significantly less than those offered on newer/more expensive cars, so beware.
No warranty at all?
It is not illegal for a trader to sell a car without a warranty, and this is fairly common on very cheap used cars (less than a couple of thousand pounds).
Unlike your statutory rights, a dealer can offer you a discount in return for waiving the warranty. However, you should be very wary of any dealer who makes this offer, as it is making you financially responsible for any fault which occurs in the car but is not significant enough to warrant rejection.
The dealer’s argument is usually that if you bought the same car privately then there would be no warranty provided, and it makes it impossible for a dealer to trade profitably on a cheap car if they have to provide an expensive warranty on a cheap car. By taking off the warranty, they can pass on the savings to you. Only accept this if you are feeling very brave.
Ask questions about the warranty being offered
When buying any car from a trader, it is important to ask about the used car warranty being offered and exactly what it covers. Don’t accept being brushed off or being told that you’ll be given a booklet when you pick up the car. Get proper answers and ask for a copy of that booklet before you agree to buy the car.
Beware of a trader who writes “no warranty” on a sales contract without any prior explanation. If a warranty is not offered, you need to make sure you find out about it before reading it on the contract. Although it’s not illegal, it is sneaky and it’s usually a sign that the dealer hasn’t been completely up-front with you about the vehicle’s condition.
There are other tricks a dodgy trader will try, such as writing “spares or repairs” or “trade only” somewhere on the sales agreement, and you need to be on your guard for such behaviour.
With any other of buying a used car, it is your obligation as a buyer to make sure you ask questions about anything you are told, and don’t simply take the salesman’s word at face value. Once you sign a contract, you are legally committed and it doesn’t matter what you’ve been told verbally. So make sure you understand exactly what you are paying for on a used car warranty or it may not be worth the paper it’s written on.