Getting A Second Opinion
Whether its new or used, buying a car is a big decision. If you need a second opinion, dont be afraid to ask for help. Consider bringing a friend who knows their way around cars. You can also take the car to an independent mechanic or get it inspected at a franchise dealership, which may have factory-trained technicians. These services usually require a small fee but can pay dividends during ownership.
Beware Of Used Car Scams When Buying From A Private Seller
Fortunately, the vast majority of sellers are honest. However, there are a few common scams you should watch for before handing over your money.
Title washing
When a car is sold for salvage value, the law requires that fact to be reflected in the title. The title washing scam involves altering or falsifying a title to remove the salvage notation. An independent VIN check can help identify whether your car has a salvage history.
Fake escrow
The fake escrow scam works like this:
- A seller advertises a way-below-market price on a car designed to get interest from many buyers.
- If you ask why the price is so low, the seller may use a few different tactics, such as claiming they’re out of the country or have moved, to urge you to accept the price and make a deposit for the car into an escrow account.
- In some cases, the seller will offer to pay to ship the car to you, just to get the sale over with. All you have to do is deposit the purchase price with their escrow service.
- Then the seller will deliver the car to you, and you authorize the escrow service to make payment when you take possession.
The catch: the escrow company is fake, and you may either lose your money and get no car or get a car that doesn’t work. In some cases, the criminals may even spoof a site that looks just like eBay or PayPal or some other trusted financial institution, and email you a link to click.
Guarantee scam
Curbstoning
Ask for service records. Most curbstoners won’t have them.
Tips
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Mobile Mechanical Diagnostic Tools
Until recently, you couldn’t get a computer code readout on a car unless you took it to a mechanic who has the necessary equipment to plug into the car’s onboard computer, read the code and translate it. But new technology makes it possible for you to get a computer reading right from your mobile device.
For example, Fixd, CarMD, Hum+ and Zubie Key each let you run a computer diagnosis either on a handheld device or on certain smartphones.
- When you buy the app, you’ll get a sensor that plugs right into the onboard diagnostics port in the car’s computer.
- Then you can get a code reading and computer diagnosis of any problem right on your handheld or mobile device, depending on the product.
- These apps should work with any vehicle built in 1996 or later.
It’s not as good as getting an experienced mechanic to check out the car before you buy it, but it’s a good alternative.
Tips
Consider meeting at the mechanic’s shop. If you’re serious about buying the car, this should be a reasonable request by the seller and indicates they aren’t intentionally concealing any vehicle issues.
Be prepared to show proof of funds and agree on a fair price if the vehicle passes inspection.
- If the mechanic gives the vehicle a clean bill of health, consider buying the car.
- If the mechanic recommends repairs, then it’s reasonable to deduct the cost of needed repairs from the purchase price of the vehicle, if the seller is willing, and then buy the car.
Protect Yourself From Recalled Cars
- Visit the National Highway Traffic Safety Administration website at nhtsa.gov/recalls to check if the car you own or plan to buy has been recalled or has any safety complaints. For more information on recalls, download the federal governments guide, Motor Vehicle Defects and Safety Recalls: What Every Vehicle Owner Should Know.
- Check if the used car you are buying has any unrepaired safety defects. Ask the dealer for the vehicle identification number and contact an authorized dealership to ask if safety recall repairs have been made. You can search nhtsa.gov/recalls by VIN to learn if a specific vehicle needs to be repaired as part of a recall.
- Before you buy a used car, ask the dealership what their policy is for selling vehicles that have been recalled. Even if the dealer tells you they wont sell a recalled car, you should do your own research.
- Get the used car you are buying inspected by an independent mechanic. Do not buy a car if the dealer will not let you have it inspected or if the dealer tries to sell you a car as is. Many safety defects will not be identified during a standard inspection so you should also check for recalls.
- Notify the manufacturer that you are the new owner when you buy a used car or if your contact information changes. If you are the original purchaser or registered owner, the manufacturer will contact you directly if your vehicle is recalled. You can also subscribe for email alerts at nhtsa.gov/recalls for future safety recalls.
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Determine How Much To Spend
There are two ways to buy a used car: Pay cash or take out a loan. If youre paying with cash, budgeting is straightforward. Make sure you dont spend all your savings and remember to set aside money for registration, insurance and possible future repairs.
Most people take out a car loan so they can protect their savings or buy a more expensive model. Its smart to get preapproved for a car loan because it simplifies the buying process and puts you in a stronger position at the car dealership. Youll see later how preapproval fits into the process.
Use an auto loan calculator to run the numbers on payments and term lengths. NerdWallet recommends that you:
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Plan to put about 10% down, which helps decrease the amount youll need to finance.
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Aim to finance the car for no more than three years.
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Budget so that, ideally, your monthly auto expenses such as car payment, gas and insurance won’t be more than 20% of your monthly take-home pay.
Run The Heater / Air Conditioner / Cd Player / Radio
This is a surprising, yet important tip when buying a used car. Make sure the amenities such as heat, air, radio, CD player work to your liking. While everything on this list might seem like a luxury, remember: not only do you want to get from point A to point B, but you also want to enjoy the ride.
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Why You Should Consider Taking A Used Car To A Mechanic
One of the most informative steps you can take before purchasing is to have an independent mechanic check out a used car. According to Nicole Miskelley, PMR Auto & Diesel Repair manager, “Most reputable dealerships allow this, but some may have a salesperson ride along for safety. Doing this can allow for someone outside of the dealership to take a once over on it and note any damage or potential repairs the dealer repair shop might have missed.”
When looking to hire a mechanic to look at a used car, call ahead to ask about familiarity with the cars make and model. A mechanic’s experience with a specific type of vehicle can alert you to potential future problems. When you find one who specializes in the car’s make, ask for cost information and availability. Most shops charge a moderate flat fee between $100 and $200.
How To Negotiate For A Used Car
Unless youre buying a used car from a dealership that doesnt allow haggling, never pay the asking price. You can almost always do better. And even if you are buying from a one price dealership, feel free to ask the salesperson to throw in a deal sweetener like extended warranty coverage.
A dealerships salesperson will typically negotiate downward from the models advertised price. Likewise, private sellers will usually advertise a used car at a higher price than theyre ultimately willing to accept. It doesnt hurt to ask for the dealership or sellers best price and work from there. At any rate, be sure to let the other party know youve researched the vehicles value ahead of time.
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Become A Vehicle Inspector
Once youve got answers to your questions, its time to take a closer look at the merchandise.
Check for rust. Rust is rarer than it was 30 years ago, but it still happens. Get on your knees and take a look at the underbody with a flashlight. Inspect lower door and fender areas for paint bubbles that indicate rust. Lift up trunk/hatch area and passenger cabin mats and look for rust or flood damage.
Look at the ground and at the oily bits. Use your eyes and a flashlight to look for leaks under the car, which could indicate the need for expensive engine, transmission or differential service. Check the vehicle underbody and the ground under the vehicle for evidence of leaks.
Take a quiet drive. During the test drive, leave the stereo system off and listen to the vehicle. Dont just drive around the corner, experience the vehicle at city and highway speeds. Purposely drive down a rough road and listen for squeaks and rattles. Use your nose to sniff out any foul odors that may indicate engine or transmission damage, an exhaust leak, or even mold or mildew smells that could indicate a flood car or leak from a windshield, sunroof or trunk seal.
Getty Images
Why Are Prices So High
When Covid-19 shut the nations economy down in 2020, many automakers canceled orders for the semiconductor chips used for everything from car radios and engine management systems to chip-enabled car keys. They took this step fearing the virus would sharply curtail vehicle sales, and they would be stuck with a glut of chips.
As it turns out just the opposite was true.
As a result of this, automakers dont have the chips needed to meet high demand for new cars, and most are struggling to keep up with production. With popular models like the Kia Telluride and Ford Bronco essentially sold out due to high demand, Americans literally switched gears and started heavily buying used cars.
According to auto industry analyst firm Cox Automotive, 40.9 million used cars were sold in the U.S. in 2021, up about 10 percent over 2020 numbers. That number included 22.2 million sales by consumers to dealerships and online retailers like Shift and Carvana. Used car sales are expected to remain high this year, with Cox predicting 2022 numbers at 39.3 million used vehicle sales, with 22.1 million by consumers selling to dealers and online retailers.
Those numbers should continue to go down as new vehicle production continues to improve. For now, however, some very popular models are selling for more used than they did new before the coronavirus/chip shortage crisis.
Frederic J. Brown, AFP via Getty Images
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Line Up Your Financing
Research your finance options now that you have some vehicles in mind and your budget set. Most dealers offer to finance, but we always recommend seeking alternatives as well. That can be a loan from your bank or credit union.
If the dealer can offer you a better deal, that works. But getting pre-approved for a loan before shopping at a dealership online or in person gives you more flexibility and does not make you beholden to just one sales lot or dealership. It also gives you the upper hand when the deal-making starts.
TIP: When shopping for a car at a car dealership, dont discuss financing until you know the final cost, with all fees and taxes included. Well tell you more about that in the section on negotiations below.
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Uncover Hidden Faults And Issues
Now that you have checked for fraud and illegal manipulation on a used car, lets move on to checking a used cars actual health status.
When purchasing a used car, many buyers decide on the car based on its looksand the driving experience. And from the outside and interior, and even while test driving, a used car might seem in great condition.
However, any internal problems going on with the car are easy to hide since they are not visible .
To purchase a good used car and get a fair deal, we recommend you carry out your own inspection by performing a quick health check with Carly. This way you will find out if there are possible issues present.
A health check will instantly tell you if there are any faults codes and problems that could cost you thousands of dollars to repair.
Besides seeing what problems the used car has, Carlys health check also tells you the severity of these issues. Therefore, if you cannot afford to have constant maintenance expenses, this is the quickest way to find out whether to buy a used car or not.
How to check fault codes and the overall health state of a used car
To run the health and diagnostics test, go to Dashboard on the Carly app. Then go to Health click on Check for issues. Your screen will look similar to the image below.
Make sure that the cars engine is on while the car is being checked. Carly will scan every system in the car for issues. Once the check is complete you will see an overall view of the cars health.
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Driving Off Into The Sunset
The time has come to enjoy your new ride. We recommend a long drive down country roads or by a lake. Canada is full of great scenery and cute little towns ripe for exploring!
Go get your car and take it for a drive! Be sure to leave yourself some time to enjoy your new purchase.
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Research Reliability And Ownership Costs
Every used car is different. Some have been driven more miles and have more wear and tear. But, in general, you want to make sure you’re choosing models known for their dependability. Consumer Reports and J.D. Power collect maintenance reports from owners and rate all used cars.
Youll also want to consider the total cost of ownership. Some cars may be cheaper upfront, but the costs can add up in the long run because of insurance, maintenance, repairs and depreciation. Automotive websites, such as Kelley Blue Book’s Five-Year Cost to Own or Consumer Reports’Cost of Vehicle Ownership, can help you estimate these expenses.
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Here’s The Lowdown On Exactly What You Need To Check
From handy hints on how to spot if a car is stolen to alterations on the mileage, here’s our essential list of questions to ask, and items to check when you’re viewing a used car.
If you buy a used car privately, it’s a case of ‘Buyer Beware’. You don’t have the same legal protection as when buying from a dealer. It’s up to you to ask the right questions and check the car thoroughly before you buy.
If you don’t feel confident about carrying out any of these checks or if you just want a second opinion, we offer car checking services.
Documents
- Can the seller show you the V5C registration document? You won’t be able to tax the car without it.
- Is the seller the registered keeper shown on the V5C? If not, why are they selling it for someone else?
- Does the registration document have a watermark?
- Any spelling mistakes on the registration document?
- Do the VIN , engine number and colour match the V5C?
- Does the number plate match the V5C?
- Has the VIN plate been tampered with?
- Do VIN numbers etched on glass or lights match the VIN plate and V5C?
- Any sign of scratches on glass to remove etched-in marks?
- Does the fuel filler look as if it has been forced or replaced?
- Does the car have a current MOT ? Check the MOT history and status of a vehicle »
Mileage
Accident damage?
Safety
Test drive
Engine
Locks, windows and general controls
Tips For Buying From A Dealer
Before you even step into a dealership, you should know the market price of the car. When bidding, start below market price, and work up. Don’t be fooled by sales or deals that boast a few thousand dollars off from the sticker price. You should also have a maximum price in mind. This allows you to walk away, and may also help in negotiating a lower price from the salesperson, because it shows that you’re not easily swayed.
The LA Times recommends staying away from discussing monthly payments with a dealer. This is because dealers may trick customers into paying more than they’re aware of. Instead, remain focused on the total price of the car.
A good rule of thumb is to separate your negotiations out instead of talking about everything at once. For example, you may want to structure your conversation first around price, then financing, then extras , and finally the value of a trade-in .
Always remember that everything is up for negotiation by that, we mean that you shouldn’t just be haggling on the price of the car. Loan packages, extended warranties, insurance, and anti-theft devices are all up for consideration. As always, compare the prices you’re quoted with what you’ve researched yourself.
Under California state law, if the car costs less than $40,000, you have the right to buy an insurance policy that lets you return it within two days.
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