Buying a used car is often a risky business. You can either come away with a car that’ll last a good long time or break down the day you bring it home. But, as Alex Perdikis explains in his blog, you can find a great used car and protect yourself as well.
Follow these five tips to find the perfect preowned car that fits your needs and budget.
- Follow the Money
Your money, that is. Figure out your finances before you start looking. Will you have to get a loan? How much can you afford in payments every month? The rule of thumb is your car payment should total no more than 20 percent of your family take-home pay per month. Factor in the cost of license, registration, taxes, insurance and maintenance. Know how much you can afford before you look and stick to your budget.
- Target Your Options
If your used car will be used to take your child’s soccer team to games, you’ll need a car that handles that. If your children are grown and it’s just the two of you, you can go small. Use online research tools to compare different makes, features and prices. Check local dealer websites, local ads and online tools to search average prices paid for specific used cars in your area. Come up with a short list of cars that fit your budget and needs.
- Choose Your Seller
You can purchase used cars from a private party, typically through an online or classified ad, or a dealer. You’ll find the lowest prices from private sellers, but you’ll have no warranties or guarantees. Used cars are considered “as-is” sales unless a specific warranty is provided. Dealers often have a variety of options for the preowned vehicle buyer, including “as-is” sales, limited warranty sales and certified preowned (CPO).
The advantage of a CPO is that you get a long-term warranty backed by the car manufacturer as well as, in most cases, the dealer. CPOs are less than 5 years old and must be purchased at the manufacturer’s franchised dealership. You’ll certainly have peace of mind if you buy a CPO. You’ll also pay a higher price.
Buying from a private seller doesn’t mean you’ll automatically get ripped off. It means you have to be diligent and walk away if any red flags appear. In other words, don’t fall in love with the car and tune out obvious signs of trouble.
- It’s “Ask the Seller” Time
Talk to the seller about the car’s history. Ask about current or past mechanical problems. Yes, you need to test drive the car to see if it fits your needs. But you also need to test drive it to make sure that it drives well and doesn’t exhibit obvious problems. If the “check engine” light or other oddities appear, discuss with the seller. It doesn’t mean the sale is off, but it’s certainly a red flag to be resolved BEFORE you agree to buy the car.
- Do Your Due Diligence
Whether you buy from a dealer or private party, thoroughly investigate the car you want to buy. If you don’t, it’s on you if something goes wrong.
To protect yourself, follow these guidelines:
- Check the vehicle’s history with CARFAX or Autocheck.
- Before you buy, have a mechanic check the car out.
- If the seller is evasive about details of the car or not amenable to fixing problems, walk away. There are great preowned vehicles on the market. Don’t settle for a nightmare.