Buying a used car can be daunting. No one wants to mistakenly purchase a “lemon” car, rife with defects that aren’t apparent at first sight. Thankfully, there are many resources and tools that can help you make an educated buying decision. Take the guesswork out of car shopping by following these used car buying tips and reviewing our used car inspection checklist. Here is a quick overview of the steps you should take:
- Do some general used car research
- Set a budget and stick to it
- Find the best deals
- Have questions ready for when you contact the seller
- Conduct your own car inspection
- Always take a test drive in the used car
- Get a vehicle history report
- Negotiate the price
- Research car financing options
- Use your instincts
1. Do some general used car research
Before you go to the dealer and start looking at cars, make a list of the car models you’re targeting. Once you have your list, do research on each car model to find out common defects, repair costs and price points when they begin to age. With your research in hand, you’ll enter the market with some bargaining power and a keen eye for the weak points in each car model.
2. Set a budget and stick to it
A good rule to keep in mind when purchasing a car is that you will want to make a down payment of at least 20% if you plan on taking out a loan so you can lower your monthly payments. You may want to consider paying even more upfront, as pre-owned vehicles can often need more repairs in a short period of time than a newer car would. In addition to repair costs, it is also a good idea to research car insurance quotes and how much gas the vehicle will use.
You will also need to decide if you want to purchase your car as used or certified pre-owned (CPO). A CPO vehicle will cost more, but will come with extended warranties and a number of additional services.
Mileage and added features can affect a car’s value, so cars of the same model and year may have different price tags. Kelley Blue Book’s pricing tool can help you get a price quote.
3. Find the best deals
Aside from dealerships, you can find great deals on used cars at local public auctions and on used car websites. Each source has its merits:
- Dealerships: Dealerships will have the widest selection of used cars available. They also often offer extras like new tires, a second key, and floor mats.
- Online: Websites like autotrader.com have listings from private sellers all over the country. Search locally and you might even find a gem in your own area. Private sellers also give you the best chance to get a bargain since they’re less likely to know the car’s true value than a professional car salesman.
- Auctions: Steep discounts can be had at auctions, but vehicles are sold without any warranties.
4. Have questions ready for the seller
When contacting a dealer or an individual seller, get as much information about the used car as possible. Here’s a list of recommended questions to ask the seller during your search:
- Why is the car being sold?
- How many previous owners have there been?
- Can you describe the condition of the car?
- What is the mileage on the odometer?
- Was the car involved in any collisions?
- Has the car had any electrical damage?
- Has this model had any recalls?
- When did this vehicle last go through inspection?
5. Conduct your own car inspection
Before taking it for a spin, make sure to carefully inspect it and check for anything that could potentially lead to headaches in the future. This means checking the exterior for signs of body repair, damage, rust, and the shape of the tires, as well as the interior for any strange odors, wears in the upholstery, and the functionality of the controls. You will also want to remember to look underneath the hood to make sure everything works properly. If possible, take the car to a mechanic for a more detailed diagnosis.
6. Always take a test drive in the used car
After giving the car a thorough examination, it’s time to get behind the wheel. Test the car both in a large parking lot and on a road where you can drive the vehicle above 60 mph. To properly assess the used car, take your time when doing a test drive, testing out all of the components, including:
- Steering-wheel alignment
- Windshield wipers
- Air conditioning/heating
- Power windows
- Headlights, directional lights, taillights
When you’ve tested everything else, turn off the radio and listen for any odd sounds that could indicate problems. For a more comprehensive, printable used car checklist to bring with you, download our PDF
7. Get a vehicle history report
Some sellers may not disclose major problems to the buyer. To avoid purchasing a lemon, write down the vehicle‘s Vehicle Identification Number (VIN) – a 17-digit code found at the dashboard – and look up the number on sites like CARFAX or Autocheck to get a detailed vehicle history report.
8. Negotiate the price
Car salesmen will almost always counteroffer with a higher price, so start with a realistic low offer. Remember to stick to your budget and price limitations. If the final asking price is unreasonable, you can always walk away from the deal.
9. Research car financing options
While most dealerships offer financing options for auto loans, you’re likely able to check several sources to find better rates, starting with your personal bank. It never hurts to compare.
10. Use your instincts
A little common sense can go a long way when purchasing a used car. Ask yourself if the dealer seems trustworthy. Know about techniques that are used to hide flaws, such as using air fresheners to mask strange odors and tampering with odometers. Avoid making an impulse buy just because you finally found a car that looks nice from an outward appearance, and don’t give in to high-pressure sales tactics. Finally, as the adage goes, if it’s too good to be true, it probably is!