Yahoo Autos How to Buy a Used Car
There are plenty of good reasons to purchase a used car, truck, or SUV instead of buying a new vehicle. Chief among them is being able to avoid the dreaded D-word—depreciation—but you can also get more for your money with a used car, and it's possible the model or specific combination of features and options you're after may no longer be available (like a manual transmission). That said, buying used has its own set of considerations, and there are additional variables at play since you're not starting with a vehicle fresh off of the assembly line. For those reasons, we've put together this guide to help you along your journey to a good deal on the right pre-owned vehicle.
Set a Budget and Decide How You'll Pay
As tacky as it may be, we need to talk money first. You have two decisions to make right off the bat: how much you're willing to spend—and that can be in total or how much per month—and whether you want to finance your purchase or pay in cash.
On the budgeting side, think about how much you're currently paying for your current vehicle if anything, and be sure to factor in costs like fuel, maintenance, and insurance, plus a little for repairs that a used car might require soon after acquisition. Without knowing what vehicle you'll be buying, at this stage these numbers will be educated guesses, so don't worry about precision and try to be conservative in your estimates. Once you've settled on a model or specific used car, you can come back to the budget and plug in more accurate numbers to double-check that you can afford what you have your eye on.
Car Loans and Pre-Approval
Before even finding your new used vehicle, talk to lenders about what kind of interest rate you can get on a car loan if that's something you're considering. The interest can eat a significant chunk of your budget. Getting pre-approved for a car loan will also speed things along once you find the right car. Remember, you're not agreeing to anything at this point, just keeping your options open.
Paying Cash
If you can swing it, paying for your used vehicle in full has advantages. First, no interest, which means you'll pay less for the vehicle in total. Second, no lien on your vehicle that you'll need to get cleared when you eventually go to sell. It's also a lot easier to pay cash when buying from a private party, as you don't need to get a bank involved. Just be aware that dealers want you to finance—and finance with them—as this is a source of additional profit, so it's best to avoid telling them upfront about how you plan to pay. Or, at least be coy about the subject until you've finished negotiating a price.
Should you choose to go the cash route, make sure you have the money in an account that offers cashier's checks, which isn't always the case with online-only banks.
Trading In
You can also treat your trade-in's value like cash toward the purchase or down payment. We suggest looking at online car valuation tools to get an idea of what a dealer would offer versus what you could get selling to a private party. That might influence whether you trade in. We're partial to the What's My Car Worth? tool on our site. It’s powered by industry data-analysis firm Black Book and will give you an idea of your vehicle’s value in three simple steps.
You can also contact local dealers or national used-car purveyors at this step to get offers directly, often through online forms. These figures are good to have in your back pocket when negotiating a deal with a salesperson later, as you may be able to get them to match the offer, or you'll know that you can get more money for your old vehicle somewhere else.
Research Body Styles and Features
With the money discussion out of the way, it's time to figure out what kind of vehicle best suits your needs and wants. Here, you're going to settle on the body style(s) that you're considering, including which features you absolutely must have and those that would be nice additions.
What body style is right for you?
This step may be a no-brainer if you plan to replace your current car, truck, or SUV with something of the same general shape and size. Nonetheless, it pays to take a step back and consider how you actually use your current vehicle and whether you need more or less capability from what's next. Did you buy a pickup thinking you'd use it all the time but found that you could have gotten by with a rented truck once or twice a year? Or maybe your family is growing and you want to move from a small hatchback to a minivan or something else with a third row? Be honest with yourself here, and think about any planned or potential life changes that may be coming your way.
What are your must-have features?
In a similar vein, think about the features your current vehicle has or is missing and make a list of what you absolutely need, what you definitely don't, and what would simply make your motoring life more pleasant. How you plan to use this vehicle plays into this brainstorming process, as you may covet certain features like Apple CarPlay or Android Auto support for a commuter car, while they may be less important for a weekend toy. Where you live and the weather you face also comes into play, as Snow Belters might find remote start and heated seats non-negotiables.
This is also a good time to think about what you'd like to power this machine. Options that may not have existed when you bought your last car, such as EVs and plug-in hybrids, are now abundant on the used market. Just be sure to consider the feasibility and added expense of a home charging station if you're thinking about something with a plug.
Narrow Down Your List
Now for the matchmaking step. Using the inputs from the above exercise, do some internet research to find the models that offer the right combination of body style and features you're after. This is especially key when shopping used cars, as stumbling on the right car is like finding a needle in a haystack. That's because, unlike with new vehicles, used-vehicle lots have offerings from any and all brands, and there's no guarantee that you'll find what you want at any particular one.
If you need ideas, peruse our past 10Best Cars, 10Best Trucks and SUVs, and Editors' Choice lists. Past lists are composed of cars that were new at the time, and we selected them in part because we believe their goodness will endure. The 10Best lists reflect the cream of that year's crop across segments, while our Editors' Choice awardees are broken down by body style, size, and price point. These are cars that are on the automotive honor roll, ones that we recommend to friends, relatives, and shoppers, and they're often the vehicles we buy to transport our own families.
Don't be shy about visiting dealers at this point just to browse. You may learn, for example, that you simply can't find a comfortable driving position in a certain model or that a space-efficient minivan is, in fact, the best option for your growing brood. (Good on you.)
When you have what feels like your shortlist, you can use Car and Driver's Rankings Lists to see how they stack up against each other. This may help you whittle down the group of candidates even further.
Decide Who You Want to Buy From
Choosing what kind of seller you want to deal with doesn't have to be an either/or decision. It's simply a good idea to know what options you have and what the relative advantages are, as some may not be palatable. This will also help you narrow the field.
A certified pre-owned vehicle provides peace of mind with additional warranty coverage and the promise that some number of checks has been performed, either through a manufacturer-backed program or one offered by a used-car mega-dealer. Qualifying as a CPO car generally means the vehicle is newer and has lower mileage, so that might not be in the budget or match up with what you're looking for if your dream vehicle hasn't been offered new for many years. But if you go the CPO route, be sure to scrutinize the warranty coverage that’s part of the deal; dealer-provided programs might not be as thorough as those provided by a manufacturer’s in-house CPO offering.
Purchasing from a private party often means a lower price, but it requires additional legwork. If you're a Craigslist pro or Facebook Marketplace guru, there are definitely deals to be had.
Used-car lots, either attached to a new-car dealer or standalone, offer a buying experience that's most similar to purchasing new. Then there are the used-only chains, which you might prefer for their selection or the warranty coverage they offer. Or maybe you really want to buy your car from one of Carvana’s giant vending machines.
Shop Around for the Right Car and the Best Price
The search begins here in earnest. Take advantage of big aggregator sites to search across dealers for something that matches your desires. These sites allow you to filter by price, trim, options, and even interior or exterior colors. Most also include private-party sellers, who usually pay a fee to list their vehicles for sale.
Pay close attention to the distance-from-me setting, as this is something you can adjust if you're not finding the perfect car right in your backyard. If you're looking for something a bit more rare or want a car that hasn't been subjected to the harsh winters where you live, consider looking farther afield. This comes with the potential for additional costs to get the car home, but it can speed things up and get you a better car in the long run if you're willing to work a deal long-distance.
One added wrinkle for used-car shopping is balancing price with mileage. They're almost always inversely related, meaning more mileage translates to lower cost. You may be cool with a 100,000-plus-miler and the savings it brings, or you might shy away from high-mileage cars. The condition of the vehicle, especially the interior, can tell you a lot about how a car was treated in its past life, so consider that along with the odometer reading.
Research the Specific Vehicles You're Considering
There's only so much you can surmise from a listing. This is where a vehicle history report comes in. Many dealers will offer a free report through one of the major vendors, either online or if you visit the store in person. Keep in mind that the aggregator site where you found the vehicle initially may want to sell you a history report, but if you visit the listing on the dealer's site they might provide a link to one gratis. You'll need the vehicle identification number, or VIN, to purchase a report; if the dealer webpage, ad, or Craigslist posting doesn't include the VIN, request it when you ask your other questions. And there are always questions to ask because few listings give you the full picture.
Don't take this information as gospel, however. It's possible and not uncommon for damage to be repaired off the books, which means it won't show up on a report. Instead consider the report as part of the story, which may tell you useful things like that it had just one registered owner or it was well cared for by a dealer or reputable shop on a regular basis.
Put on your detective hat and scrutinize the photos in the listing. Do the trunk shutlines look a bit wonky, or are there two neighboring body panels that appear to be painted slightly different shades? These are hints that there was, in fact, damage to the vehicle at some point. Another telltale: missing or mispositioned badges, especially on the rear. If that emblem was on the hatch's upper right from the factory but this car has it on the lower left, you know it has been replaced at some point, likely as a result of some crunching.
Pro tip: Find out how many keys are included with the vehicle. Keyless-entry fobs can cost several hundred dollars, most new cars come with a pair, and you'll probably want two of them. So, if only one is included you can either request a second as part of the sale or factor that additional cost into the total.
Schedule and Take Test Drives
Due diligence done, it's time to get behind the wheel of your prospective new-to-you wheels. If you're looking at cars from a dealer, try to find a few at the same store or nearby complexes to save yourself extra trips. And always call ahead to make sure the car you're interested in is still available. There are few things worse than making a trip to see a car you're excited about only to learn it just drove off the lot with its new owner.
If any of the cars you're considering are being offered by a private seller, pay attention to how that seller wants to be contacted. Some will require a sort of secret handshake in an email subject line to show them you're not a bot, or they may prefer talking over text message first. Just be respectful of people's time and, hopefully, they'll return the favor.
Some test-drive pointers: Compile a list of questions you want to ask and features you want to try before heading out. Bring any props—car seats, mobility aids, suitcases—along that will help you make your decision. Plot a course around the neighborhood where you'll be driving, especially if it's one unfamiliar to you, to make sure you get in a mix of low-speed roads, turns, and highway time. Consider bringing along a friend or relative to provide a second opinion and keep you on task.
Review the Financing and Deal
Okay, almost there. Ideally, you've settled on a price for what you're buying and one for your trade-in, if that's part of the transaction. Before committing, take one last look at your budget numbers, adjust as necessary, and confirm to yourself that you can afford this car.
What to know before signing the contract
You're approaching the point of no return, so take your time. The dealer may keep you waiting and then want signatures quickly, but don't let that tactic get you. Read everything they put in front of you carefully, checking it for correctness and whether it represents the deal you think you're getting. Salespeople aren't above trying to slip in new terms at the last minute that are advantageous to them.
If buying from a private seller, come to an agreement on what is and isn't included in the final price. Do they have a set of winter tires to sell you for a little extra? Are they planning to remove that giant subwoofer from the trunk? Know what you're getting and what you aren't.
Ask about better financing through the dealership
If you’re buying from a car dealer or used car lot, you may have already found the best financing terms from an outside lender. But it doesn't hurt to inquire with the dealer about what they offer. Don't feel pressure, however, to use their lender if you can get a better rate elsewhere.
Should you negotiate?
Unlike with new-car deals, there's a decent amount of leeway in used-vehicle pricing. A car that may be worth X to someone else may be worth less than X to you. While you can't easily point to a price on a comparable vehicle somewhere else, you can use what you know about general pricing. Here again, let valuation tools like ours guide you regarding the deal you're getting.
Finalize the Deal
Before signing your money away, it's a good idea to re-read the final contract that's put in front of you. Try not to be impatient, and make sure the paperwork is done properly.
When buying from a private party, make sure you understand and follow the local title-transfer requirements. At the very least, get the title filled out completely and signed by the seller, and it's a good idea to draw up a simple bill of sale and get copies (or cellphone pics) of that and the seller's government-issued ID.
Understanding extended warranties, add-ons, and extras
Dealers want to make as much money as possible on a sale, so expect to be peppered with opportunities to pay for extra-cost items, some of which may be worthwhile and some that aren't. If you are interested in an extended warranty, for instance, it pays to shop around for a better deal than the seller is offering. Bottom line, don't feel pressured into anything you don't want. If the final price includes things like wheel locks or vent visors that are of no value to you, politely ask for them to be removed from the vehicle and the deal. It's possible they haven't even been physically applied to the car, even if you're told otherwise.
Get to Know Your New Car
While you shouldn't expect one, you might get an offer for a walkaround of your newly purchased car from the salesperson, especially if you're buying from a new-car dealer that sells the brand of car you just bought. They may be able to help you get your phone paired over Bluetooth or set up smartphone mirroring. If you feel like this would be useful, take them up on it.
In the case of a private-party sale, the previous owner is a great resource. If amenable, they can tell you things like where to find the gas flap release, what tire pressures to use, or how to jiggle the key just right to get it out of the ignition.
YouTube can also be your friend here, as automakers often post videos explaining individual features—how to program the garage door opener, that sort of thing. Forums and subreddits can also be helpful; if you have a question, chances are another owner has already asked it and gotten a crowd-sourced answer. If all else fails, you might need to pull out the owner's manual or download one from the manufacturer's site. But look on the bright side: You're now an owner!
Take a minute to congratulate yourself on this purchase! You worked your way through a daunting, multi-step process, hopefully unscathed, and you ended up with the right vehicle for you at the price you wanted to pay.
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