How to Buy a Used Car

Naturally, it can be a daunting experience if you buy used car for the first time. Now throw into the mix if your first car is one that’s used. Where do you begin? I’m sure that your mind is filled with images of shady, untrustworthy salespeople out to pull a fast one on you. But if you take your time, do your homework and don’t rush, this used car buying experience can be relatively painless. Not much can be done about the butterflies in your stomach though.

First and foremost, set a budget for yourself 

Do research on the type of car that you want to buy. Do you want a family-sized SUV? Or a smaller, compact car for city driving and buying groceries? Ask yourself these questions before you step onto the showroom floor.

Also, once you have a budget in place, determine how are you going to pay for this. Decide if you want to pay in cash or take out a loan. Budget for your car, but don’t let it deplete your savings. Set aside some money for potential future repairs and of course for insurance and registration. The rule of thumb is to put 10% down and pay the balance off over the course of the next few years, or however, your budget will allow.

As a simple rule of thumb, choose a vehicle that is the right kind for your own personal needs. If you’re into construction, then a flatbed truck is more in line with what you need. That is just an example. Make sure that the car has had some type of mechanical inspection and that it’s not going to break down on the road immediately after you drive it off the lot.

In searching for a good, reliable used car, take a look online. Classified Ads are a good start. Or you can even go old school and look in the newspaper. Walk to a local used car lot and speak with one of the salespeople. Get a feel for the place and the person. Do you have a good vibe?

Use a reliable pricing guide to help put you in the ballpark for the price range for the car you want. $500,000 for a car that’s worth only $3,500? No, you might want to look around. If you like Sherlock Holmes, you might want to delve into and investigate the car’s history. If possible, try to speak with the previous owner. Look at vehicle records. Check the VIN (Vehicle Identification Number) to get further information on the car’s history. Have a list of questions already prepared so that you’re not doing this off the cuff. You want to make sure that all your questions and concerns have been addressed. Once you’ve found a car, naturally you’ll want to take it on a test drive. Listen for any knocks or pings and feel how it handles on the road. A test drive will let you know if the car is in a sound roadworthy mechanical shape. Don’t be intimidated by the initial asking price. Try to negotiate on the best price that fits within your budget. Use the information that you’ve gleaned to ask and negotiate for the best possible price. And make sure that the paperwork is done correctly. Whether this is buying from a car lot or a friendly neighbor.

Naturally, you’re going to want a car that will hold its future value and has low maintenance cost issues. 

With a set price established, keep the following information in mind

• Year: The age of a car, depending upon how well it was maintained is a factor to consider
• Make
• Model
• Options: These are special add-ons that are used to augment the base model of the car. An example of this could be a GPS navigation system
• Mileage: Just like the age of a car, its mileage can go hand in hand. This must be taken into consideration. Mileage will also affect the asking price.
• Condition Level: Examine if the car is clean and in good shape, or if it looks a little rough around the edges and has not been well taken care of. Does it have excessive rust corrosion or damage?
• When looking at the vehicle’s history report, keep in mind these questions:
• Are you (the seller) the first, original owner?
• Are the service records available? Has the car been in any collisions which required extensive repair and bodywork?
• Are there any liens on the car or is it paid in full?
• Ask to have the car inspected by an independent mechanic of your own choosing.

The answers to these questions will provide lots of information and will save time in the long run. It will serve you well.

During the test drive make note of the following: 

1. Is your visibility unobstructed? 
2. Are there any blind spots? Check to see how the car handles when accelerating and negotiating a turn on a corner. 
3. Does the engine have enough “pep” and power? 
4. Is it sluggish on acceleration? 
5. Do the brakes perform well with reliable and consistent predictability? 
6. When in the driver’s seat, are you able to easily reach all the knobs, dials and gauges? Listen for any strange or unusual noises during the test drive. Other things to take into consideration are back seat legroom for passenger comfort and cargo space for luggage and groceries etc.

Upon inspecting the car, independent lots will have a sign that states the vehicle is “certified”. That can mean something or nothing at all. It’s to attest to the condition and reliability of the vehicle. When the car is in a certified pre-owned program, it will be “certified” as Certified Pre Owned (CPO). This means that in principle, this should make shopping for a car easier. One hopes. If the vehicle has the CPO certification, chances are you won’t have to take the car for an inspection to your own independent mechanic.

Now you’re at the nitty-gritty point of negotiating for the best possible price. If you’ve done your homework, this part shouldn’t be stressful. 

By this point, you should have a fairly good idea of what the car is worth. Do a comparison of the seller’s asking price to that of the average market value price. And as would be expected with anyone wanting to turn a profit, the seller’s asking price will be higher than the average market price. But hold firm and don’t allow yourself to be manipulated with a fast sales talk pitch. Be focused and set in your price range keeping in mind your established budget. You don’t want to go over, especially if it’s ultimately going to be financially detrimental to you. Now you’re doing the dance. The seller will either accept your offer or make a counter offer. Don’t be surprised if the seller states, “I’ll meet you halfway.” Now the dance is picking up. Keep in mind that you’re most likely dealing with a seasoned salesperson who is familiar with all the tricks of the trade. You can go back and forth with this negotiation two-step, but remember that the salesperson will want to earn their commission. So a bird in the hand is far better than you walking away from a potential sale altogether. Again, be firm in your budget objective, but also allow a little room for flexibility too.

Well, now you’re finally in the home stretch. At long last, all your homework and efforts have paid off. It’s time to close the deal. Add the vehicle to your auto insurance policy. You can pay in cash or with a certified cheque. Ensure that all the paperwork is completely in order.

Now that this is done, you can sit back and relax and enjoy the vistas of the open road, taking comfort in the knowledge that you did your homework and left no stone unturned in this car buying adventure. There. That wasn’t so difficult, was it?