FTC Used Car Rule & Buyers Guide Compliance Guide

Last reviewed: July 2026.

Two things are true at once right now, and dealers keep conflating them. The FTC’s Used Car Rule is in force — it has been since 1985 and still governs every used unit on your lot. The CARS Rule is dead — vacated before it ever took effect. And separately from both, the FTC is actively policing how dealers advertise prices.

If you read anything in 2024 telling you to prepare for the CARS Rule, that advice is obsolete. Here is where things actually stand, and what your store has to do.

Who the Used Car Rule applies to

The Used Car Rule (16 CFR Part 455, the Used Motor Vehicle Trade Regulation Rule) applies to anyone who sells or offers for sale more than five used vehicles in a 12-month period. That threshold catches essentially every franchise and independent store, and a fair number of operations that do not think of themselves as dealers.

It applies in every state except Maine and Wisconsin, which are exempt because their own state rules impose comparable disclosure obligations. If you operate in either, you are not off the hook — you follow the state regime instead.

What the Buyers Guide must show

A Buyers Guide must be displayed on each used vehicle before you offer it for sale — not at the desk, not on request. The form itself is specified: 11 inches high by 7¼ inches wide, printed in black ink on white stock.

The warranty section is where most violations live. You pick one:

“As Is — No Dealer Warranty”

Check this box when you are selling with no warranty and no implied warranty. Important limit: this option is superseded by state law wherever state law prohibits as-is sales. Check your state before relying on it.

“Implied Warranties Only”

Used where as-is is not available, or by choice. The rule prescribes the wording:

“The dealer doesn’t make any promises to fix things that need repair when you buy the vehicle or afterward. But implied warranties under your state’s laws may give you some rights to have the dealer take care of serious problems that were not apparent when you bought the vehicle.”

A dealer warranty

If you are warranting the vehicle, the Buyers Guide has to be specific. You must state:

• Whether the warranty is Full or Limited
• The specific systems covered — shorthand like “drivetrain” is not acceptable; the systems have to be named
• The duration of coverage
• The percentage of repair costs you pay, stated as parts and labor (for example, “100% of labor and parts”)

The rule also permits an optional signature line where the buyer acknowledges: “I hereby acknowledge receipt of the Buyers Guide at the closing of this sale.” It is optional. Use it anyway — it is the cheapest evidence you will ever collect.

The Buyers Guide beats your contract

This is the provision that surprises people. Under 16 CFR 455.3, the final version of the window form must be given to the buyer at sale and is incorporated into the contract of sale — and it overrides any contrary provision in that contract.

So if the Buyers Guide says you cover 100% of parts and labor for 30 days and your purchase agreement says as-is, the Buyers Guide wins. A sloppy window form is not a paperwork problem; it is a warranty you did not intend to give.

If you conduct the sale in Spanish

The trigger here is commonly misstated as “if your store does significant Spanish-language business.” It is not. The rule is per-transaction:

“If you conduct a sale in Spanish, the window form required by § 455.2 and the contract disclosures required by § 455.3 must be in that language.”

One Spanish-language sale triggers it for that sale. You are permitted to display English and Spanish versions on the vehicle at the same time, which is the practical way to stay covered.

What non-compliance costs

Used Car Rule violations carry civil penalties of up to $53,088 per violation. Two things worth understanding about that number:

• It is per violation, and a violation attaches to a vehicle. A row of twenty units with missing or wrong Buyers Guides is not one problem.
• It has not gone up for 2026. The figure comes from the FTC’s 2025 inflation adjustment, and because BLS did not publish October 2025 CPI-U data, there was no statutory basis for a 2026 multiplier — so agencies were directed to keep 2025 levels. Expect it to resume climbing.

The CARS Rule is gone. The enforcement is not.

The Rule on Combating Auto Retail Scams would have imposed detailed disclosure requirements on vehicle pricing, financing and add-ons. It never took effect. On January 27, 2025 the Fifth Circuit vacated it, finding the FTC had failed to follow its own rulemaking procedures — specifically, that it skipped the required advance notice. The FTC did not appeal, and the rule was formally withdrawn from the federal rulebook effective February 12, 2026. None of its requirements are in force, and reviving it would mean restarting rulemaking from the beginning.

Here is the part dealers miss: losing the rule did not cost the FTC the ability to act. Section 5 of the FTC Act still prohibits deceptive practices, and the agency is using it on exactly the conduct the CARS Rule targeted.

On March 13, 2026, the FTC sent warning letters to 97 auto dealership groups covering more than 200 locations — from independent lots to large public retailers including AutoNation, Lithia Motors, Group 1 Automotive, Hendrick Automotive Group and Ken Garff Automotive Group. The letters direct those dealers to ensure that:

• Every advertised price includes all fees the customer will be required to pay — doc fees, dealer prep, e-filing and “market adjustments” included. Only government charges such as taxes and registration may sit outside the advertised number.
• Advertised prices match the price actually charged at the point of sale.
• No mandatory fee, add-on or financing condition is concealed until late in the process.

If your advertised price is not the price a customer can actually buy at, the absence of the CARS Rule is not protecting you.

A practical checklist

• Walk the lot. Every used unit offered for sale carries a compliant Buyers Guide, in the window, before it is offered.
• Audit the warranty box. Named systems, duration, and a parts-and-labor percentage. No “drivetrain.”
• Reconcile the guide against the contract. Where they disagree, the guide governs — so make them agree.
• Give the buyer the final guide at closing and capture the acknowledgment signature.
• Stock Spanish forms if any salesperson ever closes in Spanish.
• Price your advertising like the FTC reads it. Advertised price equals out-the-door price minus government charges.
• Stop preparing for the CARS Rule and put that effort into price-advertising and disclosure discipline, which is where enforcement actually is.

Compliance here is cheap relative to the downside, and most of it is process rather than expense. If you want help pressure-testing your store’s disclosures or training your finance team on it, reach out to Elite FI Partners.

This article is general information for dealers, not legal advice. Regulations change and state law varies — confirm your obligations with counsel licensed in your state. Primary sources: 16 CFR Part 455 (eCFR), the FTC’s Dealer’s Guide to the Used Car Rule, and the FTC’s March 2026 announcement on dealership price advertising.

Part of our guide to dealership F&I compliance.