Tips for Buying a Used Car

There are a few reasons you may choose to buy a used car instead of a new one. Used cars are less expensive and may still drive and feel like new. They also do not depreciate as quickly as new cars. This slower rate of depreciation means you can recover more of the purchase price if you decide to trade in or sell it later.

However, every used car comes with a history, and used vehicles may have more mechanical issues than new vehicles.

Purchasing a pre-owned car comes with unique pros and pitfalls. The tips below will guide you through the purchase process and help you get a safe and reliable vehicle at the best price.

Evaluate Your Budget and Driving Habits

Buying a used car is just as time-consuming and expensive as buying a new car. Start your car-buying process by carefully considering your driving habits. This will help you determine the vehicle you need. Ask yourself how you will primarily use the car. Some questions to consider include:

• Do you commute to work every day? If so, how far?
• Do you plan on using the car for extended leisure, like road trips or cross-country vacations?
• Does the vehicle need to perform well in winter weather conditions, like heavy snow or icy roads?
• How many passengers do you typically travel with?
• Do you have children or plan to grow your family?

Second, review your finances and calculate how much you can comfortably spend on your car. Determine what you have to put down upfront for the down payment and what you can afford monthly. Factor in these vehicle expenses:

• Car loan monthly payments with interest, if you finance your purchase (often called a car payment)
• Gas and tolls
• Auto insurance premiums
• Repairs and maintenance

Consumer guides can give you an idea of each car model's strengths, cost of ownership, and probable resale values.

Research Private Sellers Thoroughly

Most consumers purchase used vehicles through a car dealership or a private seller. There are also digital car dealers like Carvana and CarMax that allow buyers to complete the entire car shopping process online.

If you buy from an individual or private party, check the title to ensure you're dealing with the vehicle owner. You can also browse the classifieds for other auto ads with the same phone number, a sign of an unlicensed broker who sells used cars by posing as the owner.

Keep in mind that the Used Car Rule doesn't generally cover private sellers, meaning they are not required to post a Buyers Guide for the used cars they sell. The Buyers Guide is a document that tells buyers key details about the vehicle. To counteract this, consider asking the seller for a vehicle inspection by your mechanic of choice before committing to a sale.

Be sure to have coverage in place and proof of auto insurance from your insurance company before driving the vehicle away from the sale.

Once You Pick a Car, Learn its History

Any used car you choose should be mechanically sound. There are several ways to check a used car's condition:

• Visual Inspection: Look for evidence of major repair work, past damage, or mechanical failure.
• Test Drive: Go for a test drive that mimics how you would use the car. Listen for any odd sounds that could be symptomatic of mechanical defects. Ensure it accelerates and brakes smoothly, and doesn't pull to either side. Take note if the steering wheel vibrates, as this can signify faulty suspension or tires.
• Ask for the Repair History: Ensure the previous owner maintained regular maintenance and no significant repairs were ever needed.
• Mechanic's Inspection: If you're buying a car from an individual, ask to take it to a mechanic for inspection. If you're buying a Certified Pre-Owned Vehicle (CPO) from a dealership, it is likely the dealership has already done a comprehensive cosmetic and mechanical inspection. This can make an independent mechanic evaluation unnecessary in many cases.
• CarFax: While doing your visual inspection, note the Vehicle Identification Number (VIN) so you can look up the vehicle history report. Several online services can show you ownership history, accident reports, and other important information about the car. If you're shopping at a dealership, the sales representative may pull this report for free.
• Use the Used Car Rule: Dealerships that trade used cars must follow the Federal Trade Commission's Used Car Rule and provide information about the vehicle, ownership history, and applicable warranties.
• Look at the Mileage: There's no magic number for the maximum miles a good used vehicle has, but most vehicles will need more maintenance after the 100,000-mile mark. Still, other factors will give you a better idea of the vehicle's reliability than the miles on the odometer, such as the vehicle's overall condition, history, make, and model. Low mileage doesn't necessarily mean a vehicle won't have issues.

Check for Vehicle Issues

It is best to avoid issues before they happen. However, sometimes vehicle issues can slip past your initial inspections. For example, you may buy a car and later learn it has serious structural issues like rusted frames or damaged components.

If the seller or salesperson is unwilling to help, it is worth looking into relevant state and federal consumer protection, fraud, and lemon laws. Unfortunately, you may be responsible for the vehicle and its repairs immediately after purchase, unless you can prove the dealer knowingly misled you.

Additionally, vehicle dealers should provide the relevant paperwork for a vehicle, like titles, warranty information, and the bill of sale. If the dealer does not provide you with these materials or delays providing them, you may have grounds for legal action.

You can also use these online programs to check the vehicle's history:

• National Motor Vehicle Title Information System
• VinAudit
• AutoCheck by Experian

Be Open to Different Financing Options

Most dealerships offer in-house financing, acting as the lender for the auto loan. This means you negotiate the terms and conditions of the loan, like the interest rate and repayment terms, directly with the dealership.

While this is a streamlined way to finance your vehicle, it may not always be the best deal for you, the buyer.

It can pay to research financing options outside of dealer financing. You may be able to secure a loan through a local bank, credit union, online lender, or a neobank like Ally or Oportun. This could potentially save you money with lower interest and more favorable loan terms.

Negotiate the Best Deal Possible

Next, you need to be able to negotiate the price of your next car. Dealerships often have greater flexibility when pricing a used car than when pricing a new car. The best thing you can do to help yourself effectively negotiate the price of the car is to learn as much as possible about the dealership and the vehicle.

First, check out the dealership's ratings and reviews online to ensure they deal fairly with customers.

Next, look up the car's value on sites like:

• Kelley Blue Book
• Edmunds
• National Auto Dealers Association's Buyers' Guide
• AutoTrader

If you're buying a used car from an individual, the vehicle will most likely come "as-is." That means you'll be responsible for anything that happens after you purchase the car. Cars from a dealership usually come with basic implied warranties and some explicit warranties.

Additional Car Buying Tips and Resources

For more information on your rights for automotive purchases, see FindLaw's sections on Lemon Law Basics and Auto Dealer Fraud.

Duped by a Dealership or Seller? Get Legal Help

Buying the right car at a fair price isn't always as straightforward as it should be. While buying a used car typically doesn't require help from an attorney, there are situations where it is in your best interest to get legal help.

If you think the seller, either private or a dealership, misrepresented the vehicle, they may be guilty of auto fraud. In addition, some states' lemon laws extend to used cars. Consider consulting with a consumer protection attorney in your area. They can determine if you have a legal case and if so, help protect your rights.