Disclosing Car Damage
You’re buying a car, but you’re worried that it may have been damaged in the past. Learn what sellers are supposed to tell you about damage to a car they’re selling in North Carolina.
- Dealers are required to disclose in writing any damage and repair that exceeds five percent of the manufacturer’s suggested retail price before you enter into a contract.
- Dealers are not required to disclose any damage to glass, tires or bumpers if the damaged item has been replaced with original or comparable equipment.
- If a new car has been repaired for damages that do not exceed five percent of the manufacturer’s suggested retail price, then the dealer does not have to tell you about the damage unless you ask.
- If a new car has been damaged more than the five percent threshold, the North Carolina Automobile Dealer’s Association recommends that its dealers disclose it in writing on company letterhead. A copy of this disclosure should be submitted along with the title to the Division of Motor Vehicles.
- For used cars less than five years old, the seller must disclose damage of more that 25 percent of the car’s fair market value to the buyer in writing.
- If a car has been salvaged, that information must be disclosed in writing before the car is sold. A vehicle is considered salvaged if it has been damaged to the extent that repairs to make it safe enough to drive would exceed 75 percent of its fair market value. This applies whether or not the car has been declared totaled by an insurer.
- If a car has been damaged during a flood, this information must be disclosed in writing before the car is sold. A flood vehicle is one that has been submerged or partially submerged in water causing damage to the body, engine or transmission.
- If a car has been rebuilt, this must be disclosed in writing before the car is sold. A vehicle is considered reconstructed if essential parts have been removed, added or substituted.
- These disclosure requirements apply to anyone selling a car, including individual sellers and dealerships.
What Can You Do To Avoid Buying a Damaged Car?
- Carefully examine the car to make sure there are no defects. If you notice any minor scratches or dings, ask the dealer to correct them.
- Ask the dealer if the vehicle you are considering has had any damage repaired. The dealer is required by law to tell you the truth.
- Ask the salesperson to put any information about damage in writing. If the salesperson is not willing to put the information in writing, then reconsider buying the car from that dealer.
- If the car has been repaired, ask for a copy of the dealer’s internal repair invoice.
What Can You Do If You Suspect That You Bought a Damaged Car Without Knowing It?
- Contact your insurance agent to find out if there were any insurance claims paid prior to your ownership of the vehicle. There is a national insurance database that insurance companies have access to. The insurance agent should be able to tell you the date of the accident and how much was paid out in damages without disclosing any personal information about the previous owner. Some insurance companies are more helpful than others when it comes to obtaining this kind of information. If there was no insurance claim made, meaning the previous owner repaired the vehicle at their own cost, the insurance company will have no information on the amount paid for damages.
- Use a private service like CARFAX to run a background check on the car. You can usually look at the report immediately for $39.99. CARFAX reports will generally show salvage history, odometer problems and if the vehicle was used by a rental or lease company. CARFAX reports will sometimes show accident reports or damage not sufficient to result in a salvage title being used.
- Request a title history from the North Carolina Division of Motor Vehicles. A title history costs $10 and will be available in about two to three weeks. North Carolina title histories provide details about transfers of ownership within the state.
- Have a qualified body shop examine the car to determine the extent of damage. If the body shop says the prior damage was extensive, ask them to give you a good faith estimate of what was spent to repair the car.
- If you bought the car from a dealership, contact the dealer directly to get a resolution or contact the Attorney General’s Consumer Protection office at 1-877-5-NO-SCAM toll free within North Carolina.
- If you bought the car from an individual seller, contact the prior owner to reach a settlement. The Attorney General’s office is not able to help mediate private disputes.
We Can Help
If you have a complaint about car damage that wasn't disclosed by a dealer, contact us for help
or call toll free within North Carolina at 1-877-5-NO-SCAM.