Section 10 of 20

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 vehicles 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 MSRP
  • The value of replaced bolt-on parts exceeded 10 percent of the MSRP
  • Damage was to the frame, drivetrain, or suspension
  • Damage occurred in connection with a theft of the entire vehicle

Previous Use and Branded Title Disclosure Requirements

If the vehicle has a “branded” title (or ever did have), you must disclose this to your Buyer. 

California branded titles include: 

  • Salvage – Wrecked or damaged to such an extent that it is considered too expensive to repair. Includes previous “Junk” vehicles.
  • Original Taxi or Prior Taxi – Formerly used “for hire”
  • Original Police or Prior Police – Formerly used by law enforcement
  • Non-USA – Manufactured for sale outside the USA, converted to meet Federal and California safety and emissions standards
  • Lemon Law Buyback – Vehicles returned to the manufacturer under Lemon Law
  • Remanufactured – A vehicle built (or rebuilt) by a licensed Remanufacturer using used or reconditioned parts and possibly sold under a distinctive trade name

Branded title or not, you must also disclose prior police, taxi or rental use. 

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.

 

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