In many ways, buying a used vehicle is similar to buying a new vehicle, except used
vehicles provide the opportunity for greater savings, since the “instant depreciation”
experienced by new cars when they are driven off the lot is largely discounted, with
these savings passed on to the buyer. Be sure to review the ideas and tips included
in the “Buying New Cars” section as a starting point in deciding how to buy a quality
used vehicle at the lowest price, as well as the information in the “Vehicle Financing”
section to learn how to finance the purchase. However, since buying a used vehicle
also differs in certain respects from the purchase of a new vehicle, some additional
ideas on how to most economically buy a used vehicle are noted below.
1. Finding the right vehicle. Compared to new vehicles, the makes and models
available for used vehicles is almost limitless. Unless you already know the make
and model you are looking for, make a list of desired vehicle characteristics (as
discussed under the “Buying New Vehicles” heading) and take the list with you when
you are looking for a vehicle. This will help prevent you from “buying a good deal”
that ends up not meeting your needs.
a. Establish a budget for your vehicle purchase and stick to it. There is always
a good deal on a nicer vehicle that will be sure to bust your budget. Resist the
b. Visit several new car dealerships that carry used vehicles, as well as dealers
that only sell used vehicles. Don’t forget to visit the used car lots of the car
rental companies to see what they have. See what is available that is within your
budget and meets your needs. Remember, at this point, you are only at the dealer
to see what is available and help you decide what make and model will meet your needs,
not to purchase, no matter how good the deal is.
2. Once you have an idea of the make, model and year of the vehicles that will
meet your needs and budget, do some research.
a. Look up the retail and trade-in value of the makes and models you are interested
in on Edmunds.com, the Kelley Blue Book web site kbb.com, NADA.com, etc. Also use
the Internet to look up reviews from people who own the vehicle.
b. Look at the classified ads in your local papers to see if any vehicles matching
your description are available. Perhaps a friend or family member has a vehicle
for sale. Also go to Internet sites that sell used cars (there are many) to see
what is available both locally and further from home, and at what price.
c. Decide what kind of vehicle you want to buy and where it is located, and get
ready to pick a specific vehicle and negotiate. Make sure to prepare a list of questions
you want answered and take it with you when you go shopping for the vehicle.
3. Do a test drive of the vehicle before entering into any negotiations. If
you like the vehicle, ask the following questions and get the following information
about the vehicle:
a. Does the vehicle come with any warranties or is it sold “as is?” If there is
a warranty, see what it covers and who repairs the vehicle under the warranty. Check
to see if the vehicle is a “Certified Used Vehicle” which means the car has been
thoroughly checked over and comes with a warranty from the manufacturer. Everything
else being equal, a “certified” vehicle will usually cost more because of the cost
of inspections, repairs and warranties required to become certified. Generally, a
vehicle has to be no more than five years old to be eligible to become a “Certified
Used Vehicle.” Be aware that each manufacturer’s certification program may be different.
So check the terms and conditions to see what you are really getting, particularly
the length of the warranty and what it covers.
b. What is the vehicle’s history including previous owners, flood, fire and accident
damage, mileage, whether the engine or transmission has been rebuilt or a salvage
title was ever issued for the vehicle. Ask if the odometer has ever been turned
back. Consider getting a vehicle history report from CarFax.com or Experian.com/automotive
to help check the vehicle’s history. Going to the National Insurance Crime Bureau
web site (NICB.org) can help you determine if a vehicle was stolen and never recovered,
or was damaged in a storm, etc.
c. Check what kind of fuel mileage the vehicle gets by checking the U.S. Department
of Energy and the Environmental Protection Agency’s fuel economy site fueleconomy.gov.