1.9 Reminders – Changes 2018 and Older

Before we move on, let’s take a few minutes to review some important regulatory changes that happened in 2018 and earlier years that remain fully in effect. These are rules you need to know even though they’re not new — because DMV still enforces them, and violations of these older requirements are just as serious as violations of newer ones.
First, the REAL ID Act implementation. Starting in 2018, DMV began issuing REAL ID-compliant driver’s licenses and identification cards. For you as a dealer, this matters when you’re verifying buyer identity during transactions. You should be familiar with both REAL ID and non-REAL ID formats of California driver’s licenses, and understand that both remain valid forms of identification for vehicle purchase purposes.
Second, the used car lemon law notice requirements. Since 2008, dealers selling used vehicles have been required to provide specific disclosures about the buyer’s rights under California’s lemon law protections for used vehicles. This notice must be provided in writing as part of the transaction documents. We’ll cover the substance of these warranty protections in detail in Section 9, but the point here is that the disclosure obligation has been in place for years and is not optional.
Third, the advertising substantiation rules. Since 2017, DMV has been increasingly strict about requiring dealers to substantiate their advertising claims. If you advertise a vehicle at a specific price, that vehicle must be available at that price. If you advertise a financing rate, that rate must be available to qualified buyers. DMV investigators actively monitor dealer advertising — including online listings, social media posts, and third-party website listings — and will cite dealers for misleading advertising.
Fourth, the unlicensed activity crackdown. DMV has been steadily increasing enforcement against unlicensed vehicle sales — sometimes called “curbstoning.” If you as a licensed dealer are aware of unlicensed activity in your area, you can report it to DMV’s investigations unit. This protects legitimate dealers like you from unfair competition from people who aren’t paying for bonds, maintaining proper facilities, or following consumer protection rules.
Finally, remember that the requirement to maintain an established place of business — with proper signage, a permanent structure, telephone, internet, and posted hours — has been in effect for decades. These aren’t new requirements, but they’re the ones that DMV cites most frequently when taking enforcement action against dealers. Don’t let familiarity breed complacency. We’ll cover location requirements in much greater detail in Section 4.