- Buying a used car can be a stressful experience, but if you plan ahead, you can get some great deals.
- The biggest choice is between buying from a dealership or a private seller.
- In particular, don’t overlook certified pre-owned vehicles or gently used luxury brands.
Knowledge is power, especially when it comes to buying used cars.
But perhaps the most important knowledge is self-knowledge. Know what type of vehicle you want before you get started, understand your budget, and determine whether you know enough about cars to cut a deal with a private seller — and not end up with a lemon.
I’ve come up with 11 basic tips for buying a used car — there are many more, but these will get you started. The biggest choice is whether to go to a dealer or to strike out for the wilds of private sellers. You can find some dandy cars with the latter, while the former will take a lot of hassle out of the process.
Either way, getting organized, establishing a budget, and being realistic are all important objectives. If you do your homework, you should be happy with the results.
1. How used is the car?
I don’t even look at a used car that has over 100,000 miles unless there’s a compelling reason — like, I want to take a crazy chance on a quite old Saab or Cadillac. Vehicles can go well past 100,000 miles on the odometer these days, but even with reliability legends such as Toyota and Honda, if there have been multiple previous owners, you can’t know how the car has been treated.
Cars that have passed the 100K milestone are also apt to need major repairs, such as timing-belt replacements. Additionally, they could have small parts that are starting to wear out from age.
In my book, 50,000 miles is a good starting point. You can go 20,000 under or 20,000 over, depending on your budget and needs. You should also have a solid framework for what you want before you even get started. A midsize sedan, for example. That will prevent you from being distracted by fantasies about sports cars or pickup trucks.
2. Have you looked at the Carfax report?
The Carfax report is a document that’s compiled by a service that’s been around since the mid-1980s. You sign up for the most useful paid services, and then you can search for records on one or several vehicles (the latter option is good if you intend to check out a bunch of rides before buying — five reports will cost you $100).
Using the car’s “vehicle identification number” (VIN), you can explore a prospect’s automotive DNA: how many owners it’s had, whether it’s been in any reported accidents, whether the title is “salvage” (indicating a serious misadventure), and so on.
If you’re shopping at dealerships for a used car, you’ll usually get a gratis look at the report, or can ask for it. In my experience, the report is less valuable as a review of a car’s history than it is as a means of finding out if a car you’re interested in has major problems.
3. What’s your budget, and is it flexible?
If you plan to buy the car outright from a private seller, then you need to determine what your lump-sum limit is. If you’re financing, then the ballpark price is important, but so is your monthly outlay.
The last time I bought a used car, I decided roughly how much I wanted to spend in total and then gave myself a range for the monthly payment, because I wasn’t sure how the financing would shakedown.
But I also decided to limit my upward wavering by just a few thousand dollars on the sticker price — that way, if I saw something that was a perfect fit, I’d end the search and simply buy the car. And that’s what I wound up doing.
Keep your range narrow; if you’re realistic, you should be able to find something that you’ll be happy with.
What about haggling over the price? With a dealer, I’m all for it — within reason. They’re typically going to have better-quality used vehicles, so trying to negotiate some crazy deal is pointless.
Interestingly, private sellers have often used internet sites, such as Kelley Blue Book, to arrive at with a fair value for their vehicle. You can often tell right away whether they’ve been honest with themselves about their car’s condition. If what you see wasn’t what was advertised, I think the best course of action is simply to walk away, rather than trying to hammer out some kind of deal.