So you’re on the hunt for new wheels, it’s exciting, but you already know you need to be cautious, cars aren’t cheap, and buying a lemon can be expensive.
So how do you buy a used car from a dealer? To successfully buy a used car from a dealer, follow these 6 steps:
- Have rock solid budget
- Pre select and research your make and model
- Select a dealer
- Research the dealer reputation
- Have vehicle and history checked
- Don’t be afraid to haggle and never pay sticker price
If you’re not comfortable checking over the vehicle yourself, have a reputable appraising company inspect it, if the dealer doesn’t agree, find another dealer.
Have A Concrete Budget
If you’re hunting for a classic car or a modern used motor, you’ve got to start with a budget. I know what it feels like, you’ve got the cash and you want the car today, like right now.
It’s easy to get carried away, the salesman takes you for a test drive, the car feels great, he says he can hook you up with a great deal on finance and he makes it sound like a no-brainer.
I don’t blame the sales teams, it’s their job to get as much for the car as possible, which includes making a fee on the financing.
I worked in a large GM garage and the turnover of sales staff would make you dizzy. These guys are driven hard to sell, so you need to be prepared and disciplined with the amount of money you want to spend.
Pre Select A Make And Model
Don’t rush this stage, we need to get this bit right. If you do your research really well before you go to the dealer, you’ll have the upper hand.
You’ll likely know what body style you want, you may already have a particular brand selected, you just need some guidance on the model, engine size, etc.
Research is easy, there’s a ton of car comparison sites and they do a pretty good job reviewing vehicles.
Check out Edmunds.com and TrueCar.com, they estimate the values of new and used cars. They’re great research tools.
Check out forums too, lots of makes will have a fan club site, they can be a valuable source of information. These sites usually aren’t trying to sell you a car so the info is unbiased.
Check out the NHTSA, (links to the government website) there you can search (by VIN or vehicle type) and research your chosen vehicle for known recalls and major defects.
All vehicles have a weak link, so don’t get pessimistic when you find (and you will) problems associated with your model choice. The thing to remember here is the problems should be small and even better if the manufacturer is recalling them to make the repairs.
Having done your research on reliability and the know weak areas of your car, now it’s time to get a feel for the price.
Search Kelley’s Blue Book (KBB.com) for your make & model, check the prices trim levels, and go back every few days and see how quickly these cars are selling.
Why not ring a few sellers and ask them about their car, was it a good car? what problems did it have? What did they like and not like about it? Ask them straight out why are they selling it?
They won’t know you’re on an info-gathering exercise, most will be happy to talk about their car.
Select A Dealer
Dealers earn a reputation, you need to know who you are dealing with. Search local forums and google the dealer name, if it’s got bad press, it’ll likely be posted.
Obviously, it’s not possible to be in business without conflict, some customers can have unrealistic expectations and so it’s possible the dealer will have a few barking dogs.
But if there’s a common theme with the dealer, like they’re not honoring warranty or selling accident repaired cars without disclosing, pay attention, ask around.
Ask work colleagues or acquaintances, where they bought their car, and if they’d recommend the dealer, use their experience.
Having found a reputable dealer, there’s no guarantee they’ll have the exact car you’re looking for. You may have to balance a good dealer against a slightly different spec model. In my experience, a good dealer will source what you’re looking for.
Checking The Car And History
If you do your own car maintenance then you likely have the skills to check over the new car. It’s great that you found a reputable dealer but that doesn’t mean you should buy without first checking it over.
I like to get on the lot and inspect the exterior of the car without the salesman breathing my neck, so I usually just ask “can I look at the cars and I’ll come see you afterwards” Most dealers will be fine with that.
Never inspect a car in bad weather, you’ll rush the job, and snow or rain will hide scratches and mismatched paint.
Before buying any vehicle, it’s always worth investing few dollars to check the VIN number against a database. A check with a company like VinAudit (links to VinAudit) will guard against Mileage fraud, Salvage rebuilds, Title washing, and Vin cloning.
When visually inspecting a car, I look for the following:
- Tires evenly worn and good
- Wheels are curb rash free
- Windshield free from cracks
- Paintwork free from dings and scratches and paint matches
- Panel gaps are uniform
- Car is sitting level
- No sign of over-spray paint on the window seals etc
- No oil leaks under the car
Take a note of any defects and put a dollar value on them. You may not be exact but you can ballpark, you know what tire costs and bodywork isn’t cheap even a few scratches can cost a few hundred to put right.
Now let’s go see the dealer, we want to test drive, look under the hood and inspect the interior. Before starting the car, check under the hood, check the oil condition and level, a low oil level suggests neglect, and an engine that’s using or losing oil, either isn’t good.
Remove the oil cap check for a white scum, often a sign of excessive moisture in the engine or worse a head gasket failure.
Check the coolant, you won’t know the condition by just looking at it, but the level at least should be correct.
Check the brake fluid level, if it’s low, it’s a sign that the brake pads are worn, a murky-looking fluid means it hasn’t been changed. Brake fluid should be changed every 3 years unless it’s Dot 5.
Now turn on the ignition switch, the abs, airbag, oil light, and check engine lights should be illuminated as well as the battery and parking brake warning light.
It’s important to check these, they need to come on and go out as you start the car. Modern cars as you know run self-diagnostic tests and illuminate a light if there’s a problem.
Start the car, the engine should be quiet, rattle-free, no smoke in the rear mirror and the oil light should go out quickly, as should the airbag and abs dash warning lights.
The interior obviously should be clean and soft furnishings tear-free, a smell of must suggest a water leak and I hate car freshers, they mask other odors like spilled milk.
Check the electrics, this might seem laborious but electrics can be expensive to diagnose and repair.
High on the checklist, because they’re expensive are:
- Air-con system
- Heated seats
- Power seats
- Power windows, mirrors & sunroof
- Infotainment system
- Parking sensors
Bring any faults to the attention of the salesman, if he hesitates about fixing them, I’d cut short the test drive.
Electrical issues are often simple, but because of the complexity of modern vehicles, not every mechanic will take them on. Some electrical problems will need main dealer software upgrades, these aren’t always available to non-dealer shops, meaning the main dealer visit and big dollars.
Use all your senses on the test drive, don’t be afraid to tell the salesman to be quiet. You want to hear, smell and feel anything out of the ordinary, we’re only concerned with how the car performs here.
Listen and feel for any hesitation, vibration, rattle, knock, squeak, thump or roar.
The engine should be responsive, the transmission should be smooth, suspension-free from noise, and the steering sharp and tight.
This might sound obvious but I’ll say it anyway, we never pay the sticker price. But we’re not in the business of running the salesman or his car down, instead, we’re pointing out its shortcomings (real or imagined) and assigning a discounted price.
A great time to go shopping for a used car is at the end of a week, month, or better still, the end of the quarter. Dealers like to move inventory and banks like to see cash moving in the business, it’s better than stock lingering on the lot.
Ask about the past and soon due maintenance on the car, ask to see the service records. Is the timing belt due, what about a coolant change, brake fluid change, transmission oil change.
Ask if the recalls have been done, you’ll find the used dealer won’t know about active recalls, as he has 100s of different models on his lot.
You’ll already know the answers to these questions because you did your research. If a timing belt isn’t currently due but will be in say 15 thousand miles or so, use it to drive the price down.
Remember the price on the window has been inflated, if you checked the price of the same car on Craig’s list they’d be a lot cheaper. Of course your not getting a warranty on Craig’s List, so it’s not quite apples and apples.
All used cars will have defects because they’re used. Use it to your advantage, ask for a discount because of that cigarette burn or the scrape in the rear bumper.
Ask for their best price because you’re looking at another car later that day. If you like the car and it passed your tests, be cheeky, offer them 20% off the sticker price, the worst they can say is no.
If you are spending cash and you are buying today, use it as bargaining power. Keep chipping away, it’s your money.
If you need finance, you’ll likely do a better deal organizing it yourself in advance, however some branded dealers may have 0% finance on their own brand used cars.
Your goal is a fair deal where both parties are happy. I like to be polite but firm in my dealings, build a rapport because you may need to collect on your warranty.
Happy hunting, and the best of luck with the new wheels!
Is it better to buy a used car from a dealer or private seller? Buying a car privately has advantages, the private seller usually wants to sell it quickly. This is often reflected in the price, however, the main disadvantage is you won’t get a warranty, if anything goes wrong, you’re on your own.