I used to be one of those people who would never consider buying a used car. I thought, why not just get a shiny new one with that new car smell and the latest features? But then, my budget got the better of me, and I realized that I could save a significant amount of money by going used. I was skeptical at first, but after doing my research and finding a great deal, I’m now a convert. If you’re in the market for a used car but aren’t sure where to start, here’s how you can do it safely and confidently.
Do Your Homework
Before you even step foot in a dealership or start browsing online listings, you need to do your homework. This means figuring out what kind of car you need and what you can afford.
Determine Your Budget
Used cars can range from a few thousand dollars to over $30,000, so it’s important to set a budget before you start shopping. Remember, the sticker price isn’t the only cost to consider. You’ll also need to factor in insurance, gas, maintenance, and repairs. A good rule of thumb is to spend no more than 15% of your monthly take-home pay on all your transportation costs.
For example, if you take home $3,000 a month, your total transportation costs should be no more than $450. This includes your car payment, insurance, gas, and maintenance. If you’re looking at a car that costs $300 a month but your insurance is $200 and gas is $150, you’re already over budget. So, be sure to do the math before you fall in love with a car.
Research the Model
Once you’ve set your budget, it’s time to start researching different makes and models. Look for cars that are known for their reliability and have good reviews. Websites like Edmunds and Kelley Blue Book can be great resources for this. They provide detailed information about different models, including their pros and cons, common problems, and reliability ratings.
You should also look at the car’s depreciation rate. Some cars lose value faster than others, which can affect how much you’ll get for it when you’re ready to sell or trade it in. For example, a 2018 Toyota Corolla with 50,000 miles might be priced around $15,000, but a 2018 Honda Civic with the same mileage might be priced around $14,000. That’s because the Civic tends to depreciate a bit faster than the Corolla.
Find the Right Seller
Once you’ve narrowed down your choices, it’s time to find a seller. you’ve a few options: dealerships, private sellers, and online marketplaces. Each has its pros and cons, so let’s break them down.
Dealerships
Buying from a dealership can be a good option if you’re looking for a wider selection and some peace of mind. Many dealerships offer certified pre-owned (CPO) cars, which have been inspected and come with a warranty. This can give you some added protection in case something goes wrong.
However, dealerships can also be more expensive than private sellers. And while CPO cars are a good option, not all used cars at dealerships come with a warranty. So, be sure to ask about the warranty before you make a purchase.
Private Sellers
Buying from a private seller can often be cheaper than buying from a dealership. You can find private sellers through online classifieds, word of mouth, or even a sign in their yard. However, buying from a private seller can also be riskier because you won’t have the same protections as you’d at a dealership.
If you decide to go this route, be sure to meet the seller in a public place and bring a friend or family member with you. Also, be sure to get a vehicle history report and have the car inspected by a mechanic before you make a purchase.
Online Marketplaces
Online marketplaces like Autotrader and CarGurus can be a great way to find a wide selection of used cars. They also offer tools to help you compare prices and find the best deal. However, like private sellers, buying from an online marketplace can be riskier because you won’t have the same protections as you’d at a dealership.
If you decide to buy from an online marketplace, be sure to do your research and only buy from a reputable seller. Also, be sure to get a vehicle history report and have the car inspected by a mechanic before you make a purchase.
Inspect the Car
Once you’ve found a car you’re interested in, it’s time to inspect it. This is where you’ll want to be extra careful, as a used car can have hidden problems that aren’t immediately apparent.
Get a Vehicle History Report
Before you even look at the car, you should get a vehicle history report. This report will tell you important information like the car’s accident history, service records, and whether it has a salvage title. Websites like CarInventory can provide this information for a small fee.
Check the Exterior
When you’re inspecting the car, start with the exterior. Look for any signs of damage, such as dents, scratches, or rust. Check the tires for uneven wear, which can indicate alignment or suspension problems. Also, look at the lights and windows to make sure they’re all in working order.
Check the Interior
Next, move on to the interior. Check the seats, carpets, and dashboard for any signs of wear and tear. Look for any strange smells, as these can indicate problems like mold or mildew. Also, test all the features, such as the air conditioning, heating, and stereo.
Check Under the Hood
Finally, check under the hood. Look for any signs of leaks or damage. Check the fluids to make sure they’re at the right levels and that they’re not dirty or discolored. If you’re not comfortable doing this yourself, you can always bring the car to a mechanic for an inspection.
For example, let’s say you’re looking at a 2015 Honda Accord with 70,000 miles. When you inspect it, you notice that the tires have uneven wear, which could indicate a problem with the alignment. You also notice a strange smell coming from the air conditioning, which could be a sign of mold. And when you check under the hood, you see that the oil is dirty and needs to be changed. These are all red flags that you should consider before making a purchase.
Negotiate the Price
Once you’ve inspected the car and you’re still interested in buying it, it’s time to negotiate the price. This is where you’ll want to use all the information you’ve gathered to your advantage.
Do Your Research
Before you start negotiating, do your research. Look up the average price for the car you’re interested in. Websites like Kelley Blue Book can give you a good idea of what the car is worth. This will give you a good starting point for your negotiations.
Make an Offer
When you’re ready to make an offer, start low. The seller is likely expecting this, so don’t be afraid to negotiate. Be polite but firm, and be prepared to walk away if the seller isn’t willing to meet your price.
Consider the Extras
If the seller isn’t willing to lower the price, consider negotiating for extras instead. For example, you could ask for a warranty, a free tank of gas, or a promise that the seller will fix any problems that come up within a certain time frame.
Remember, the goal of negotiating is to get the best deal possible. Don’t be afraid to walk away if the seller isn’t willing to meet your price or your terms. There are plenty of other used cars out there, so don’t settle for one that isn’t right for you.
For example, let’s say you’re looking at a 2017 Toyota Camry with 50,000 miles. The seller is asking $18,000, but your research shows that the average price for a car like this is $16,000. You could start by offering $15,000, then negotiate up to $16,500. If the seller isn’t willing to meet your price, you could ask for a warranty or a promise that they’ll fix any problems that come up within the next six months.
Buying a used car can be a great way to save money, but it’s important to do it safely. By doing your homework, finding the right seller, inspecting the car, and negotiating the price, you can find a great deal on a used car that’s right for you. So, don’t be afraid to give it a try. You might just be surprised at what you find.