DMV Dealer Continuing Education
Vehicle History Disclosure Requirements
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Used Vehicles Condition of Vehicle and Known Damage
California Used Vehicle Dealers are not required to disclose prior accidents or frame damage. A Used Vehicle Dealer could be exposed to legal action if they withhold information to get a sale. For example, the Dealer states the vehicle was never in an accident and they know otherwise.
As of July 1, 2012, California Vehicle Code §38010 requires that Dealers obtain a National Motor Vehicle Title Information System (NMVTIS) report from an approved provider before a used vehicle is offered or displayed for sale. Motorcycles, recreational vehicles, and off-highway vehicle are exempt from this requirement.
If the NMVTIS report shows a previous salvage or other state title brand or reported event such as Insurance Total Loss, it must be disclosed to consumers. Each vehicle with Salvage Title brand or other problem is required to have a red 4” x 5” Warning sticker with language warning potential buyers that the vehicle has this kind of salvage history.
The Dealer must display this Warning Sticker on the vehicle, next to the Federal Trade Commission Buyer’s Guide.
New Vehicles Condition of Vehicle and Known Damage
Prior to entering into a Contract on a new (or previously unregistered) vehicle, all Dealers are legally required to fully disclose (in writing) any damage, including, but not limited to, material damage, known by the Dealer and not repaired.
You must disclose previous damage to the new vehicle Buyer if the value of the:
- Repairs (parts & labor) exceeded $500 or 3% of the Manufacturer’s Suggested Retail Price (new vehicles)
- Value replaced bolt-on parts exceeded 10 percent of the manufacturer’s suggested retail price of the vehicle
- Damage was to the frame, drivetrain or suspension (requiring repairs other than wheel balancing or alignment)
- Damage occurred in connection with a theft of the entire vehicle
Previous Rental, Taxi, Police or Law Enforcement History
Regardless if the vehicle has a “branded” title, you must disclose to your Buyer if the vehicle is, or ever was a:
- Taxi vehicle — formerly used “for hire”
- Rental Car
- Police or Law Enforcement vehicle (or formerly used by Law Enforcement)
Failure to provide these disclosures is a cause for action against your license.
Written Disclosure for any Aftermarket Add-on Items
You must disclose any vehicle modifications which alter the vehicle from the vehicle manufacturer’s original specification.
Examples of this would include suspension, oversized tires & wheels or exhaust systems.
Maintenance type repairs that do not alter the vehicle do not have to be disclosed.