If you’re willing to pass on the ‘new car smell’ you’ll find there are plenty of reasons to purchase a used vehicle the next time you’re in the market. Cars depreciate incredibly fast, often losing as much as 25% of their value as soon as you drive them off the lot. In fact, after only two years that new car will be worth 40% less, regardless of how gently it’s been used or how few miles it has logged. So if you can take the time to shop carefully and do a bit of research you will always find more bang for your buck forgoing the new vehicle. Of course, that doesn’t mean you still can’t be taken for a ride. Many people have been burned during a used car purchase because they didn’t know how to successfully go about the process. Here are five essential steps to take when purchasing a used car, to help you avoid those mistakes.
First of all, take the time to research the make and model vehicle you are considering. Modern cars are certainly known for their longevity. It’s entirely normal for a new vehicle to last well over 100,000 miles, and many brands will keep running far longer than that. But while this is the new normal in the industry, not every vehicle will live up to that expectation. It’s well worth the time to do a little digging. Start with Kelley Blue Book and hunt down some reviews of the car you would like to buy. You’ll find specific differences based on model year, which will help you avoid buyer’s remorse if you find out you could have had a much better vehicle in the 2008 model than the 2007 offering.
You’ll also want to have a range of prices in mind. Used cars are generally sold at slightly different rates if the seller is a dealership or a private party. You’ll spend a little more going the dealer route, but might also have the opportunity to take on some of the remaining factory warranty or purchase a vehicle that went through a top to bottom inspection and certification process. When buying from a private party you’re going to have to trust their word and whatever records they’ve kept around. You’ll save what could be a significant amount, but you won’t have the same level of assurances.
Regardless of which route you choose, always make sure you run a Carfax report before handing over any money. The Carfax document is inexpensive, and will detail the accident history of the vehicle. It’s never a good idea to purchase a car that has been in a major accident, even if it was completely overhauled. There may be a serious structural issue you won’t discover until several months later, at which point it will be too late. Just remember that the Carfax document isn’t a 100% guarantee. It will only include accident information if a formal report was filed. Fender benders or other issues that didn’t involve the police won’t be listed.
When you meet with the seller make sure you have the chance to give the used car a test drive. No matter how good it looks sitting in the driveway you have to see how it feels on the open road. That will give you a chance to test out the brakes, examine the transmission as you move between gears and listen for any little squeaks or grinding sounds that could mean trouble. You’ll also get to know the buyer a bit more, and possibly hear him talk about the car when his guard is down a bit.
If you’re still interested after the test drive, always try to negotiate. People set their prices based on that Blue Book value, and the dealers build in some profit as well. You should always be able to talk them down a little bit, or at least have them throw in an auto detailing service or oil change to seal the deal. Keep in mind that you’ll have additional costs to contend with, from changing the registration to adding this purchase to your insurance policy. Even a couple hundred dollars shaved off the top will help immensely.