Tips and tricks for buying a used car?
I'm trying to buy a used car but don't really know where to start. I've been fortunate enough to have my last (and only) car passed down to me from a family member, so I've never had to go through this process before and I'm terrified of wasting money or getting taken advantage of! Like, where do you go to get a used car? It feels like a basic question, but I see a lot of cars available online through private sale or from a dealer/franchise or used car lot, and tbh I'm not sure what the difference is or if any of these is better than the others? What should I be on the lookout for when I check out cars? How do you begin the process of getting the car inspected, negotiating price, etc.? Any tips I should keep in mind? Thank you endlessly!
If this is your first time buying a used car and you don’t have anyone experienced helping you out, I’d recommend buying from a dealership. Specifically, look for certified pre-owned cars. There’s nothing wrong with buying from a private party, but you’ve got a lot more that can go wrong when it comes to the car if you don’t know how to spot common issues or scams.
Certified pre-owned cars typically have warranties of some kind, and there are checks that dealerships have to complete to get a used car certified, which means it won’t have any crazy problems. You’ll pay a bit more for certified, but if it’s your first time I’d recommend it.
When you buy privately you’re probably going to get a better deal, but you have to deal with the title stuff and the transfer on your own. Plus, private sales aren’t typically covered by the same laws as dealerships, so you’re more likely to get ripped off if you aren’t confident in what you’re doing. Plus, you’ll probably have an easier time negotiating with a dealership. People selling their car privately tend to be very hard-headed and annoying when it comes to negotiating in my experience.
Certified pre-owned cars typically have warranties of some kind, and there are checks that dealerships have to complete to get a used car certified, which means it won’t have any crazy problems. You’ll pay a bit more for certified, but if it’s your first time I’d recommend it.
When you buy privately you’re probably going to get a better deal, but you have to deal with the title stuff and the transfer on your own. Plus, private sales aren’t typically covered by the same laws as dealerships, so you’re more likely to get ripped off if you aren’t confident in what you’re doing. Plus, you’ll probably have an easier time negotiating with a dealership. People selling their car privately tend to be very hard-headed and annoying when it comes to negotiating in my experience.
Some, but by no means all, important tips when buying a used car:
1. Know your budget. What’s the cost to insure this car? Look up your credit to determine your financing options. You can get pre-approved for an auto loan (bank, credit union) to determine what your budget will be. Is there a pre-payment penalty?
Public resource for auto loan shopping: https://www.consumerfinance.gov/consumer-tools/getting-an-auto-loan/plan-to-shop-for-your-auto-loan/
2. Make sure the registration is current, otherwise you could be held responsible for late fees.
3. Check to make sure that the title matches the name of the person selling you the vehicle or that the person selling you the vehicle has power of attorney to sell the vehicle.
4. Ask for a Vehicle History Report (when was it ran? Ask them to run it the day you want to buy it so you know they’re not hiding something recent).
5. You can also go on carfax to run your own report. The first one is typically free, then check carfax.com for the price of additional ones, it’s ~$40.
6. Ask if the car comes with a warranty, and can you purchase an extended warranty? Is it through the manufacturer or a 3rd party? What do they cover? And if the dealership’s service department will accept that 3rd party warranty, what are the terms (e.g. deductible, coverage, etc)?
7. You can ask your mechanic or 3rd party companies to do an inspection (~$125-400) to confirm that there are no major damages.
8. Take the car for a test drive first. Always see the car during the day, as it is much more difficult to identify any potential issues in the dark.
9. If purchasing through a dealership, check their reputation through online reviews, and ask friends if they have ever dealt with the dealership. If purchasing through a private seller, do a quick search using the VIN # to see if it is listed on other sites for less or has been listed for over 45 days. Working with a car broker will help you get the best deal because they have the existing relationships to bend those rules in your favor.
10. Have confidence because you’ve done your research, and you know the deal you want. Be willing to walk away.
1. Know your budget. What’s the cost to insure this car? Look up your credit to determine your financing options. You can get pre-approved for an auto loan (bank, credit union) to determine what your budget will be. Is there a pre-payment penalty?
Public resource for auto loan shopping: https://www.consumerfinance.gov/consumer-tools/getting-an-auto-loan/plan-to-shop-for-your-auto-loan/
2. Make sure the registration is current, otherwise you could be held responsible for late fees.
3. Check to make sure that the title matches the name of the person selling you the vehicle or that the person selling you the vehicle has power of attorney to sell the vehicle.
4. Ask for a Vehicle History Report (when was it ran? Ask them to run it the day you want to buy it so you know they’re not hiding something recent).
5. You can also go on carfax to run your own report. The first one is typically free, then check carfax.com for the price of additional ones, it’s ~$40.
6. Ask if the car comes with a warranty, and can you purchase an extended warranty? Is it through the manufacturer or a 3rd party? What do they cover? And if the dealership’s service department will accept that 3rd party warranty, what are the terms (e.g. deductible, coverage, etc)?
7. You can ask your mechanic or 3rd party companies to do an inspection (~$125-400) to confirm that there are no major damages.
8. Take the car for a test drive first. Always see the car during the day, as it is much more difficult to identify any potential issues in the dark.
9. If purchasing through a dealership, check their reputation through online reviews, and ask friends if they have ever dealt with the dealership. If purchasing through a private seller, do a quick search using the VIN # to see if it is listed on other sites for less or has been listed for over 45 days. Working with a car broker will help you get the best deal because they have the existing relationships to bend those rules in your favor.
10. Have confidence because you’ve done your research, and you know the deal you want. Be willing to walk away.
I 100% agree with Mr. Hamby on the Carfax thing. Vehicle history is really hard to check without one, so don’t buy a used car without seeing the Carfax first. The other thing I’d recommend is to cross-check the price for each car you look at with the price on Kelley Blue Book and Edmunds. Those two sites are the most reputable price calculators for cars. If the price of a used car is way below the KBB and Edmunds value, there may be something wrong with the car. It could be something minor, like rust or cosmetic damage, and if you can live with that it might be a good deal! At the same time, it might be something more concerning, so investigate it. If the price is way over the estimated prices you find, you may be getting ripped off. Or, you could just be looking at a really good model. Good luck!
I am generally a proponent of new cars. That might sound like I'm talking about people spending more money than they can afford, but in my practice, I've seen that used cars actually end up costing more. Say you're looking for a $15,000 car and you buy this car, you can only drive it for two or three years, and during those two or three years, you will spend money fixing the car, and then you'll end up selling the car. You will pay tax on the entire price because you had to purchase the car, and if you average it out, you might end up having spent just as much as if you had leased an affordable car.
There are leases right now that are $200, sometimes even $150 a month. So if you do the math, you will come out ahead leasing the new car, in my opinion, a lot of times. The other common mistake I see is people on a budget try to buy high-end used cars. So for example $15,000 on a Porsche or a Mercedes is going to get you a nightmare. You're going to be at the shop all the time, you're just asking for a disaster. If you spend the same $15,000 on a Honda or a Toyota, you're going to get a safe, reliable car and you're not going to have to spend money fixing it while you own this car.
There are leases right now that are $200, sometimes even $150 a month. So if you do the math, you will come out ahead leasing the new car, in my opinion, a lot of times. The other common mistake I see is people on a budget try to buy high-end used cars. So for example $15,000 on a Porsche or a Mercedes is going to get you a nightmare. You're going to be at the shop all the time, you're just asking for a disaster. If you spend the same $15,000 on a Honda or a Toyota, you're going to get a safe, reliable car and you're not going to have to spend money fixing it while you own this car.
Always take a car you’re thinking about buying to a mechanic to have it checked out before you buy it. If you’re buying from a dealership or private party and they won’t let you have a mechanic inspect it, it’s a sign the car is full of problems. This is a super normal practice, so anyone saying “no” should be the end of your deal. When you take it to the mechanic, ask them for a pre-purchase inspection. It’ll probably cost $100-200, but it’ll be the best $100-200 you’ll ever spend. If the mechanic says it’s a good car for a good price, go for it. If the car has problems, you’ll at least get a good estimate from the mechanic so you can work that into the negotiation.
As a previous buyer and seller, here are the biggest red flags to look out when you buy a used car.
Check the exterior for mismatched paint, rust around the edges, and lots of wear and tear on all the parts. For the interior, be on the lookout for stains, damaged upholstery, musty smells, and anything else that gives you an "off" vibe.
Take it for a test drive. Watch out for black exhaust smoke, loud roaring or knocking from the engine, and issues when you're accelerating or braking.
Oh, also check if there has been any recalls on the make and model to make sure you're not buying a faulty vehicle.
Check the exterior for mismatched paint, rust around the edges, and lots of wear and tear on all the parts. For the interior, be on the lookout for stains, damaged upholstery, musty smells, and anything else that gives you an "off" vibe.
Take it for a test drive. Watch out for black exhaust smoke, loud roaring or knocking from the engine, and issues when you're accelerating or braking.
Oh, also check if there has been any recalls on the make and model to make sure you're not buying a faulty vehicle.
If you're trying to negotiate a lower price for your car, do your research and find the same make and model with similar mileage at other dealerships or sellers. Check how they're pricing their vehicles and tell that to the dealership or seller that you plan on buying from. It's pretty hard for them to rip you off if you come at them with facts that you can back up. You can usually try to ask for 10-20% off the total with some success.
I know some dealerships have gotten more stingey with negotiating in the last few years, so this may work better with private sellers.
I know some dealerships have gotten more stingey with negotiating in the last few years, so this may work better with private sellers.
1. Know your budget for the car. Do not base your budget on the car and then spend what you cannot afford.
2. Identify what is important to you in a car. Is it fuel mileage, large family capacity, ability to carry stuff, tow capacity, or style? Then, do research to find makes and models that fit your interests.
3. Once you identify the car you want, do some research before talking to the seller. I highly recommend a carfax report to see if there have been any accidents. Check websites to see what similar cars' price points are to make sure this car is not too high or too low (both are suspect). When you do talk to the seller, ask about maintenance. Has the car had regular oil changes? Have they kept receipts? Is the car titled properly with no accidents?
4. Do a very good visual inspection and if you have a family member who is an auto tech ask them to come along. Any issues could be used to negotiate the price. Some things to look at: Check the condition of the tires, are they worn and need replacing? Check the interior for damaged seats, headliners, dashboard, and lights. Turn the car on and see if it has a check engine light on. When you start the car, is it easy to start? While it is idling, is it smooth or surging? Check the air conditioning while it is running and do a light check. Most people don’t look underneath the car, but rust or fluid leaks on the undercarriage can indicate that a car is in poor condition. Checking for rust is especially critical if buying a classic car.
5. Just because you find a few minor problems doesn’t mean you can’t make an offer, just ask the seller if they are willing to come down and give them the list of things you found wrong. In many cases, the seller might be willing to fix those issues themselves or come down on the price enough for you to pay for the repairs. Keep in mind the seller might have already been aware of any issues you found and has already accounted for that in their price. In that case, it becomes your decision to buy or keep looking. Good luck with the car hunt!
2. Identify what is important to you in a car. Is it fuel mileage, large family capacity, ability to carry stuff, tow capacity, or style? Then, do research to find makes and models that fit your interests.
3. Once you identify the car you want, do some research before talking to the seller. I highly recommend a carfax report to see if there have been any accidents. Check websites to see what similar cars' price points are to make sure this car is not too high or too low (both are suspect). When you do talk to the seller, ask about maintenance. Has the car had regular oil changes? Have they kept receipts? Is the car titled properly with no accidents?
4. Do a very good visual inspection and if you have a family member who is an auto tech ask them to come along. Any issues could be used to negotiate the price. Some things to look at: Check the condition of the tires, are they worn and need replacing? Check the interior for damaged seats, headliners, dashboard, and lights. Turn the car on and see if it has a check engine light on. When you start the car, is it easy to start? While it is idling, is it smooth or surging? Check the air conditioning while it is running and do a light check. Most people don’t look underneath the car, but rust or fluid leaks on the undercarriage can indicate that a car is in poor condition. Checking for rust is especially critical if buying a classic car.
5. Just because you find a few minor problems doesn’t mean you can’t make an offer, just ask the seller if they are willing to come down and give them the list of things you found wrong. In many cases, the seller might be willing to fix those issues themselves or come down on the price enough for you to pay for the repairs. Keep in mind the seller might have already been aware of any issues you found and has already accounted for that in their price. In that case, it becomes your decision to buy or keep looking. Good luck with the car hunt!
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Reader Tips from How to Buy a Used Car
Prioritize a thorough inspection before purchasing a used car. Hire a certified mechanic to assess its condition, ensuring all major components are in good shape. Request the vehicle's maintenance history and a comprehensive vehicle history report to uncover any potential issues. This meticulous approach empowers you with knowledge, helping you make an informed decision and ensuring your investment in a used car is both reliable and satisfactory.
Don't make a decision in a heartbeat. If anyone tries to pressure you into making a decision quickly, stay calm and tell them you want to come back the next day. Not only will taking time to think it over help you decide if it's really what you want and should do, but playing hard to get may make a salesperson give you a better deal.
Reader Tips from How to Buy a Car
When you go to a dealership, bring your spouse, or a friend. You are more likely to be taken seriously. If you do not have one, then walk in with an air of confidence. If you are a single woman, it is good to bring a male friend who knows about cars, so that you don't let the dealer mislead you. Sales people will try to take advantage of you, don't trust them.
Act as if you know what you are talking about, do not allow them to sway you from what you are honestly looking for. Be confident and firm, and if they start swaying you to another choice, then just leave.
Reader Tips from How to Check out a Used Car Before Buying It
Always take a test drive! Check the acceleration, brakes, shifting (transmission and transfer case, if 4WD), handling and steering, etc. Look for smoke or exhaust issues as well as any fluid leaks under the car when you return.
Test the door handles and locks, windows, air con, heating, defrost, headlights, tail lights, brake lights, interior lights, and all other accessories.
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