We all want to get a great deal on a used car, but there are usually problems with used cars such as a history of accidents or excessive mileage. However, if you follow the 5 tips below, you’ll likely end up in a much better decision when you’re about to hand over your hard-earned cash.
1) Check the CarFax or AutoCheck
CarFax and AutoCheck both allow you to check important details about a vehicle, including any accidents the vehicle has been in as well as service records. Many dealerships include a free CarFax report for used cars. Ask for this report prior to purchasing the vehicle. What you find may surprise you. Additionally, CarFax reports are now being made available online, which makes it much easier to research vehicles prior to purchase.
Video: YouTube (CarFax)
2) Buy Certified Pre-Owned (CPO)
Buying a used car can lead to a lot of worrying. Worrying about maintenance, servicing, and even mechanical failure. You can get rid of all these extraneous factors and simply enjoy your new car if you go the Certified Pre-Owned route. Certified Pre-Owned (CPO) vehicles usually include 2, 3, and even 5 years of maintenance and service coverage, which means you can rest easy when it comes to maintenance costs for your vehicle.
Best of all, most car manufacturers have strict standards for which cars make it to their CPO inventory. There are usually a myriad of mechanical, cosmetic, and electronic tests conducted on potential CPO vehicles to ensure they are in top condition. Of course, there is a premium to purchasing a CPO vehicle. However, when taking into consideration the money you’ll be saving on maintenance (and the invaluable stress saved from worrying about maintenance), it is usually worth the premium.
3) Expand Your Filters
Most online car search engines (such as AutoTrader) have the ability to filter multiple parameters when searching for vehicles. By expanding your filters to include just 1-2 more years, you can score a great deal on a model that’s just a few years older. It’s not uncommon for these older models to also have fewer miles, so it ends up being a great value.
Additionally, filters such as “Instant Cash Offer Participating Dealers” allows you to find dealerships that accept instant cash offers that can be generated online through services such as Kelley Blue Book.
4) Create a Search Alert
I can’t stress this one enough. By setting a search alert for incoming used inventory, you can basically have used cars “sent” to your inbox. Search alerts match preset parameters (i.e., BMW 3 Series from the years 2010-2016, with 6 cylinders, in blue), taking the guesswork out of what cars set off an alert. By setting a search alert and waiting a few weeks, you will be surprised to find new deals earlier than others searching for the same vehicle. And as we all know, the early bird gets the worm.
Video: YouTube (TrueCar)
5) Check the Value (assume +8% on the sticker price)
This one is seemingly a no-brainer, but you’d be surprised to know that most people buying a used car do not have a definitive understanding of the vehicle’s value. Dealerships will often advertise a low sticker price, only to switch and provide several reasons for why they can’t meet you at that price. This is the classic “bait and switch” tactic used by many dealers.
To avoid this, there are several things you can do. First, research the vehicle’s value by comparing across several websites such as Kelley Blue Book, TrueCar (which now covers used cars), as well as Edmunds. Also, consider having the car appraised.
Finally, assume a +8% addition on top of the sticker price. This will provide a reasonable cost of the vehicle assuming taxes, fees, and other miscellaneous costs. So, for example a car costing $15,995 can turn out to be $17,274 at the sale. Is that extra amount worth it? This can change the way you look at the vehicle in question.
By combining the 5 tips above, you can ensure that you’re in a great position when it comes to purchasing your used vehicle. It most certainly will make you more informed, and knowledge is power. Good luck!