Your 10 Step Guide to Buying a Used Car

Are you in the market to buy a car? Have you considered purchasing a used car? Used cars are great options for anyone looking to buy a quality vehicle on a budget. But, with used cars, you need to make smart choices and there are a lot of things to consider before purchasing one. Shopping for used cars can be stressful when you’re main priority is to get a good deal, but what’s more important than getting a fair price is that the car is reliable and won’t require expensive repairs. With such a big investment, you don’t want to be impulsive and end up with a lemon.

Whether you’re buying from a dealership or a private seller, these are the things you to browse smarter and make informed decisions when purchasing a used car. This article is your ten-step guide to buying a used car!

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Step 1: Budget

Before you even start looking for new cars, figure out how much you’d like to spend. Be aware that used cars will require some extra attention and money for things like tires, maintenance, repairs, and inspection. If the car you’re interested in purchasing is out of warranty, it’s important to have a “just in case” fund for any unexpected repairs. Setting a price range can also help narrow your search and allow you to negotiate a price you’re comfortable paying later down the line.

Step 2: Research

Gone are the days where you’d have to spend a lot of time and money to research cars. Start by writing down what you want in a car. Consider things like the number of people that need to sit in the car, the size of the car, and the features you want. After you do that, research what cars match your description and what their prices are. Kelly Blue Book is a great resource to use. Prior to stepping foot in a dealership, look at classified ads and print out information from dealerships, so you know what’s available and what you should expect to pay for cars in your area.

Step 3: Financing Options

If you’re not planning on paying cash for the car, consider your financing options. You may be able to get approved for an auto loan through a credit union. Take into consideration the cash down payment, the trade-in value of your current car, and how much you owe on your old car.

Step: 4 Vehicle History

While there are often exterior signs that a car is not in the greatest condition such as dents, scrapes, and scratches, a vehicle history report, such as Carfax, will reveal the car’s accident history and whether it has a salvage title. A salvage title is when an insurance company has determined the car to be a total loss. To get this information, you’ll use the car’s vehicle identification number (VIN) or license plate. VINs will tell you the vehicle title, records, if the car has been recalled, and if the odometer has been rolled back, which surprisingly happens a lot.

Step 5: Test Drive

You can’t expect to buy a car without trying it first. With a test drive, you can determine the condition of the car and if it’s what you’re looking for. When you start the engine, listen for tapping or clicking sounds, which could mean that there’s an issue with the car. While you’re test driving the car make sure you drive it on different types of roads and at various speeds to check if the transmission shifts smoothly. Pay attention to any brake noises or unusual engine sounds and if the electronics like the air conditioning, brake lights, and turn indicators in the car are working properly. Other things to consider include if you feel comfortable in the car, the legroom, the position of the steering wheel, and the space in the backseat and trunk.

After you test drive the car, ask the owner or dealer to see the service records, so you can check if the car has had scheduled maintenance performed.

Step 6: Car Inspected/Pre-Purchase Inspection

You can start by checking for signs of accidents by examing the exterior of the car for dents, scrapes, scratches, and rust. Other things to look at are if the door open and close easily, if the body panels line up, if the hood and trunk open and close easily, wear and tear on the upholstery, the carpets and floor mats for leak or water damage, and the smell of the car.

The next thing to do after you’ve done a vehicle report and checked the car for signs of damage is to take the car to a trained mechanic so they can inspect the car before you purchase it. A mechanic can determine if there are leaks or if the car has been in an unreported accident. Make sure you do an inspection at a shop, where the mechanic can put the car on a lift and also check for any damage underneath the car.

Some people choose not to have a mechanic inspect the car because it costs around $100 to $200, but having the car looked at can save you a lot of money and headaches down the line.

Step 7: Negotiate

The price listed for the car isn’t necessarily the final price. Before you start negotiating, decide how much you’re willing to spend, but don’t reveal this number when you start haggling the price. Your opening number should be less than your maximum price, but it should be around the average price for vehicles of the same make and model. When you negotiate, you should keep in mind the number of previous owners, the car’s accident history, failed inspections or emissions, and the current condition of the car.

Step 8: Be Okay Walking Away

You should never go into a sale with the idea of purchasing the car that same day as being too eager to buy a car can result in accepting offers that you’re not comfortable with or settling for things that may seem like red flags. Be prepared to shop around, even if the deal seems really good, so you’re not pressured to buy a car that’s not the right fit for you.

Step 9: Car Insurance

Before buying the car, many dealerships require you to have proof of insurance. Remember that before you can drive the car you’ve purchased, you’ll need to be insured on that car.

Step 10: Switch Car Title/Prepare Transaction

Prior to purchasing the car, make sure the person you’re dealing with is the actual owner of the car. Make sure the owner isn’t still paying off the car. Once you’ve done this, get all the paperwork in order including title information, warranties, and any other information that relates to the purchase of the car. Make sure the seller signs over the title to you. If possible, check with the department of motor vehicles to make sure there aren’t any overdue registration fees on the car. Although you may be tired from all the previous steps, it’s important that you take your time with this as you don’t want to experience any surprises after you’ve paid for the car.

If you’re at a dealership, you’ll sign the contract in the finance and insurance company and they’ll offer you additional items like warranty, anti-theft devices, fabric protection, and prepaid service plans. The contract will usually include the cost of the vehicle, a documentation fee, a charge for a smog certificate, sales tax, and license fees.

Once you’ve done all of these things, you can celebrate your new purchase and drive away in your car. Enjoy!