To buy used car from a dealer, especially if you’re not an experienced car buyer, you should prepare yourself by getting information on the available options and ways to buying a used car.
To start with, you may need to convince yourself of the benefits of buying a used car.
For many, used cars simply mean value for money, as a new cars value can drop as much as 30% as soon as it leaves the dealership.
If you’re thinking about buying one of the more expensive cars but don’t want to pay the full sticker price, buying one used can bring the car within your price range.
The overall process to buying a used car is similar to buying a new car. For the first, you should think about what you need from the car, in terms of car type, options, and details (perhaps down to the make of the car).
Also, smart shopping includes doing research on car prices (for your target price), car financing, car insurance, plus an understanding of the process, which all should help you negotiate better terms for your purchase.
As there are a lot of emotions involved in buying a car, doing research will give a more detached point-of-view to evaluate the purchase.
Where to Buy Used Car
Your options for sources to buy a used car include:
used car dealerships
auctions, both online and off-line
rental car agencies
Also, dealerships that sell new cars have inventories of used cars. These are either trade-in cars or customer returns of new cars. All these sources have their pros and cons.
For example, you may get a great price on a used car from a private seller, but the private seller may not have as much in terms of reputation on the line as a dealer normally has, which may lead to more uncertainty as to the condition of the used car.
Buy Used Car from a Dealer – Checking the Condition of the Car
When purchasing a used car from a dealership, one of the biggest risk factors is the condition of the car. Therefore, extra effort should be put to making sure that you don’t end up with a car that is in worse condition than what the seller has stated. Luckily, there are services that will give you the history of the car. For example, CARFAX is a service that provides a report on:
results from emissions inspections
type of usage (such as leased car)
whether the odometer was rolled back
The service charges for the report, plus you’ll need the 17-digit VIN (Vehicle Identification Number) number to get the report. Checking the vehicle’s service history is also a natural part of the inspection process. If the service history is not clean, that can be a possible deal-breaker, or at least a feature that should reduce the price you should be willing to pay for such a car.
Apart from the vehicle’s history, the current condition should be examined to the fullest before you buy used car. For non-mechanics, this examination should be left to independent third-party mechanics. Some used car dealers won’t let you take the car to the mechanic’s shop, in which case you may have to get the mechanic to the dealers lot or use their in-house people.
Buy Used Car – Buyer’s Guide
When shopping for a used car from a dealer, you should look for a paper sticker called Buyer’s Guide. That sticker must appear in the window of all used cars sold commercially, mandated on a Federal level by Used Car Rule. If you don’t see the Buyer’s Guide, you should probably go to another dealer. Car dealers who sell more than five used vehicles in a 12-month period must comply with the Rule.
The Buyer’s Guide will denote whether there is an active warranty (or no warranty at all) and whether the warranty comes from the dealer or the manufacturer.
Buy Used Car – Negotiating
The details of the check-up process for the used car will affect your ability to negotiate the price for the car. Even though some of the features, such as mileage, are partly priced in, you may still negotiate based on these features for a lower price if you think there is much room to do so.
Also, any negatives you find in the car’s history or current condition should decrease the price you should be willing to pay for the car.
If the car has been sitting in the dealers lot for a long time, that is an indication that the demand for such a car is not too great, which again increases your bargaining position over the price.
Once you think you have reached the best possible price for your desired car, you can try to negotiate extras with your purchase, such as extended warranty/service, and having all closing costs included in the purchase price, if there are any such costs.