The Right Way to Buy a Used Car?

Is Buying a Used Car Better Than Buying a New Car?

Deciding whether to buy a new car or a used car is not always an easy decision. A new car is new for a very short time. The minute you cross the dealership’s lot with one, it depreciates a quick twenty percent and is now a used car, whether you like it or not. For the next four years it depreciates another 50% so after five years you have something worth 30% what you originally paid if lucky. The worst investment in the world. Buying the RIGHT used car is usually a better alternative than buying a new one. It’s cheaper, someone else absorbed those years of depreciation. You usually avoid the new car lemons as any used car purchase can be thoroughly inspected by checking maintenance records and having a mechanic do the once over. No one knows that you bought the Mercedes Benz used, only you.

Benefits to buying a pre-owned car?

• Insurance is generally cheaper on a used car.
• Dealers now sell certified used cars that go thru a comprehensive vehicle checklist and come with their own warranty sometimes eclipsing the new car on the lot.
• More places to find a used car: private seller, manufacturer dealer, auction, rental car agency, and independent used car dealer.
• Certified Used cars generally have subvented finance programs through the manufacturer.
• Generally more room to haggle a deal than a new car.
• Get more car for less money

Certified Pre-Owned Vehicles

About 10 years ago, responding to consumer demand as new cars were becoming almost too expensive for most people, the manufacturer dealers started offering Certified used cars as an alternative. A Certified Pre-Owned(CPO) vehicle is normally a used car of that particular dealership. If they sell Honda, the used car lot should be stocked with an ocean of late model, two to three year old, low mileage used Hondas. The CPOs are vehicles that all go thru a 100+ point comprehensive check-up, from the body integrity, to the mechanical systems, both major and minor, to a printing of a CARFAX. The car is then given a bumper to bumper warranty on top of what is left from the original manufacturers new car warranty. Some of these warranties can go all the way to the 100k mile mark. Manufacturers sometimes offer subvented CPO finance rates. They are still for people with better than average credit but it isn’t unusual to see 2.9% APRs or even 0% at times.

Steps To Buying The Right Used Car

• Check reliability reports on that particular vehicle using reliable sources like Consumer Reports, Edmunds, and Kelley Blue Book.

• Find out what market value is on the car you want. Look at what people are selling similar cars for on Autotrader, Craigslist, and other pricing sites.

• Run a Vehicle Identification Number(V.I.N.) check at Carfax or Autocheck. The V.I.N. Check Vehicle History Report(VHR) will tell you if an accident was reported on the vehicle, manufacturer recalls, whether the vehicle was service vehicle; like rental, police or taxi. The VHR will confirm the mileage and sometimes will list the maintenance visits at a dealership and will tell you if the title has been endorsed with a salvage, rain damage or total loss from an insurance company. Both CARFAX and Autocheck certify their reports and offer buyer protection with the cost of the report.

• Do a Test Drive from a cold start. The drive you take should include varied terrain, hills and valleys if possible, different roadways and at varied speeds. No, around the corner and back victory lap. If you haven’t driven the car for 30 minutes at all different speeds, you haven’t “test driven” the car. Even an uneducated ear can pick up the telltale signs of a problem. If the salesperson objects, walk away, there is something he is hiding or just plain lazy and if this is the attitude now, imagine what it will be after you bought it and ran into an issue.

• Do a visual inspection. Walk around the vehicle and look for signs of body repair. Look under the hood for new parts and repairs to inside fenders. Pop the trunk and see if you can see any signs of leaking. Use your nose. Smell the trunk; smell the interior; do you smell water? Look at signs of wear and tear that differ from what you are being told. A heavily worn driver seat and brake pedal signify a high mileage car so if the odometer reads 30k, it really could be 130k.

• Maintenance records on vehicle should be with the vehicle and reviewed. If they aren’t ten assume the car has been neglected as far as maintenance and beware. It is important that a car is well maintained to protect it’s durability. Buying a vehicle with 29k on the odometer means that the $600, 30k mile major service is around the corner. Make sure you deduct that cost from the asking price or make it contingent on the deal.

• Ask for a CARFAX. All dealers have an account with CARFAX and AUTOCHECK. If they refuse or ask why you need one, Run, don’t walk away. They are hiding something.

• Basic Warranties are standard on any dealer used car sale unless it falls into the rare “As Is” category. Don’t buy an “As Is” car unless you are okay with it breaking down the following day. A bumper to bumper warranty of a minimum of 1 year is recommended.

• Can the vehicle be Certified? There is a charge to the dealer by the manufacturer for that and it isn’t cheap, usually $595 to $1995 depending on the car, obviously a Chevy is a lower cost and a Mercedes is the higher price certification. It is usually worth the cost since the value normally exceeds the price. And since you will most likely finance the car, it should only add between $10 to $30 a month for the Certification. And that can save you thousands of dollars over the next few years and give you peace of mind on long trips since every dealer of that manufacturer is now your local repair shop. Isn’t a dollar a day worth the peace of mind?
• Hire a Mechanic to do an inspection of the vehicle. It is worth while to spend $100 to get a certified ASE mechanic to go over the car and give you a report on the vehicle. You can use your own mechanic or hire a professional vehicle inspector. They can be found online or on craigslist.

Caveat Emptor

Every buyer must follow these famous Latin words, “Caveat Emptor; Let The Buyer Beware.” No, truer words have been spoken. It is up to you to choose right. It will be your fault if you buy the “pig on the lot.” Don’t fall in love. Remember this love isn’t a simple divorce if all goes wrong. A bad purchase will drive you crazy and will make a huge dent in your wallet. It will make you not trust your car and limit the enjoyment and freedom you get from your car. Follow my steps. If you don’t, you may wind up being a trophy on a dubious salesperson’s wall next to the deer head.