Buying a used car is a great way to save a few bucks, but how do you make sure you are not buying a lemon?
To help you make a sound decision, this guide provides you with all the considerations you should make before you sign the dotted line.
Here eight important considerations for buying a used car:
1. Depreciation and The Best Time to Buy a Used Car
There is a fairly consistent pattern in car value depreciation:
- Within the first year, a car loses 25% – 30% of its original value.
- The second year it loses 6% – 8% of its original value.
- The third year it loses approximately 5% of its value.
Once you get into year 4 and beyond, you can expect the value of the car to plummet as it is likely no longer covered under warranty. To get the best bang for your buck on a car that has remaining warranty to boot, look for one that is as close to its original purchase date as possible.
Good times of year to find deals include around major holidays when dealers are light on staff, or at the end of a month or year when the salespeople scramble to meet their quotas.
2. Thoroughly Research The Model
Before you buy, make sure you thoroughly research the model of car you are considering. What features does it have? Were people satisfied with that year’s model?
Kelley Blue Book is a comprehensive site you can use to do your research. It provides you with information on every car under the sun, including how much you should be paying for a used model.
3. Review The Vehicle History Report
When considering used cars, you should always perform a vehicle history report. You can give the vehicle identification number (VIN) or License Plate number to a site like CARFAX and they can pull a detailed history on the vehicle.
Some of the important items to review on a CARFAX report include:
- History of major accidents
- Open recalls on the vehicle
- Total loss
- Service history
- Ownership history
- Registration history
- Warranty information
- History of flood or hail damage
4. Perform a Pre-purchase Inspection
While this will cost you a small amount, hiring a specialist to inspect your car will make sure you don’t end up with a lemon. A trained mechanic can identify any issues with the car the seller doesn’t know about or isn’t letting you know. They will also let you know if the condition of the car is in line with the age and mileage.
To find a specialist in your area, just search for pre-purchase car inspection and look at the services and their reviews.
5. Test Drive The Car
No matter how good of a deal a car is, always test drive it first. Not only will you be checking if the car drives smoothly, but you will have peace of mind knowing the car feels natural and safe.
6. Get Insurance Quotes
It is important to check ahead of time how much insurance you will have to pay on a used car. Many dealers will not even let you purchase a car from their lot without first showing proof of insurance.
To get used car insurance quotes you must provide insurers with:
- Your age and license number
- The garaging address of your vehicle
- Insurance info of previous owners
- The VIN number
Take the time to do research so you find yourself the cheapest rate. For other cost-saving tips on car ownership, be sure to read the wise driver’s guide to saving money on car expenses.
7. Determine The Warranty
It is important to determine how much, if any, of the warranty remains on the car. A “certified used car” often has remaining manufacturer’s warranty, but you need to ensure you read the fine print on the contract of sale.
If there is no additional warranty, some customers choose to purchase an extended warranty if it is available.
8. Haggle The Price
Do not be afraid to haggle on the price of a used car, you can usually get the price down at least a little. It helps to be armed with the right information, whether that is information from the pre-car inspector you hired, or in checking the average sale price of used cars of the same model.
Where Can I Find Used Cars For Sale Online?
There is no shortage of online used car directories and online shopping sites. Wherever you decide to buy a used car, it is always a good idea to look at any independent reviews of the lot or service you are looking at.
Some of the biggest online retailers of used cars in America are:
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