The California CARS Act brings the most significant changes to the vehicle sales process since the 2005 Car Buyer’s Bill of Rights. That’s why LAW® and CNCDA have been working together to help dealers prepare, including co-presenting a webinar in July and at Reynolds’ Amplify conference in August. Both presentations walked dealers through what’s changing and the documents designed to help dealers navigate these new obligations.
LAW recently added eight new or revised documents to the California LAW F&I Library® to help dealers prepare for when the CARS Act goes into effect on October 1. Together, they address four essential areas that will require attention:
- Vehicle’s “Total Price”
- Monthly Payment and Comparison Disclosures
- Add-Ons Benefits and Disclosures
- 3-Day Right to Cancel for Certain Used Vehicles
Of the four areas, the 3-Day Right to Cancel may have the biggest operational impact because it requires dealers to create and follow new processes.
Under the Act, buyers and lessees of used vehicles priced at $50,000 or less will have three-day right to cancel, beginning the day after signing. Dealers may charge a restocking fee if a customer exercises that right. If a customer traded in a vehicle, the dealer must return it unless it has already sold or the dealership has begun transferring the trade-in’s title. If the tradein cannot be returned, the dealer will owe a refund instead.
The new obligations extend beyond the paperwork. In addition to including a Cooling-Off Notice on the first page of the purchase or lease agreement, dealers must also display a physical notice in every sales office or cubicle where written terms could be discussed, as well as in each room where contracts are regularly executed.
The following documents were created or revised in response to the California CARS Act:
- Retail Installment Sale Contract (LAW 553)
- Pre-Contract Disclosure
- 3-Day Right to Cancel Used Car Purchase or Lease
- Acknowledgement of Cancellation and Receipt
- Notice of Failure to Meet Cancellation Requirement(s)
- Total Price Disclosure
- Optional Add-On Products or Services Disclosure
- Cooling-Off Poster
With the exception of the Cooling-Off Poster, all documents listed are available in English, Spanish, Chinese, Korean, Tagalog, and Vietnamese in both pre-printed and electronic formats. They are available for order now but should not be used until October 1. Dealers can watch the webinar recording for more indepth information on these documents and the Act’s key areas.
Helping dealers prepare for the California CARS Act is just the latest example of the long-standing partnership between LAW and CNCDA. LAW’s history in California dates back to 1929, when the brand was founded in Oxnard, so supporting Golden State dealers is something we take seriously.
To learn more about these new documents, contact your dedicated Compliance Consultant and schedule your free F&I Document Review and help ensure you’re ready when the Act takes effect October 1.
