Can a Dealer Sell a Used Car on Recall?

Buying a used car can be a hassle. If you’re buying through a private seller, you need to get your car checked out by a mechanic, and that takes time and costs money. You may think it’s easier, safer, and more reliable to buy a used car from a dealership, especially when they have a “certified pre-owned” used car program.

But does that mean it’s perfect? Everything’s fixed and ready to drive off the lot? Not necessarily. You might be surprised to see a car on a dealer’s used car lot, check the CarFax and find that it’s on an open recall for the replacement of a Takata air bag inflator.

Yes, you know–the air bags that have exploded with bits of shrapnel. So, what’s going on?

Apparently, there’s nothing consistent about the way automakers handle recalled cars, says Westways Magazine’s Peter Bohr. Some car companies will sell unrepaired vehicles, but not without full disclosure, and yet the National Automobile Dealers Association (NADA) stated that the automakers and the National Highway Traffic Safety Administration (NHTSA) have deemed that “affected vehicles are acceptable for consumers to drive while awaiting repairs.”

The Takata recall is a good example of this. Millions of vehicles have been recalled, yet those cars can’t all be repaired at once, not least because there aren’t parts available. According to Bohr, “Research firm J.D. Power and Associates estimated in 2015 that car buyers would have received, on average, some $1,200 less for their trade-ins if dealers had been barred from selling cars with open recalls.” Why? Because dealers would be passing on the costs they would incur for extra storage fees and finance charges until the cars were awaiting repair and sale.

So what’s a person in the used-car market to do? Caveat emptor—buyer beware. It’s down to you to do your homework, your due diligence, and make sure you know the full history of the car before purchase. And we want to emphasize again that, especially if you’re buying from a private owner, make sure to get the car checked out by a reputable mechanic before you hand your money over. If you’re buying from a dealership and you know the car has an open recall, the manager of the Auto Club’s Car Buying Service Dave Cavano suggests your ask the dealer to include written confirmation that the car will be fixed before you take full possession. This can be included in the sales contract.

And when you do get that new car, brand new or new to you, you need to let your insurance company know asap! Looking for a competitive quote? We’ll give you one for free. Just give us a call at 714-838-1911 and we’ll help you out.

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