Tips for Buying A Used Car

July 21, 2020

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When you buy a new car, it depreciates as soon as you drive it off of the lot. A car loses 20% of its value as soon as you buy it and up to 30% within the first year. This is significantly faster than depreciation in used vehicles. And, for this reason, many financial experts recommend only buying used. When you consider these factors, buying a used car starts to look pretty appealing. The process may seem intimidating if you’ve never done it before, but when you consider the savings, it’s worth it. And working out a few details before you buy your used car can save you even more later.

Eight Tips to Buy a Used Car on a Budget

1. Develop a budget

As is the case with most things finance-related, the first step in this process should be setting a budget. If you’re taking money out of savings for this purchase, determine how much you’ll need to leave behind to have a sufficient emergency savings fund. Knowing how much you want to spend and how you’ll pay for a used car will help you avoid financial complications further down the line.

2. Know what you’re looking for

If you already have a make and model picked out, you can move right on to the research phase. But if you haven’t narrowed it down yet, it’s important to choose the right car based on your needs. Do you need a lot of storage space, or are you happy with something smaller? Do you need something kid-friendly, or will a two-door option be better? Listing out what you want will help you find the right one, even if it’s simply through the process of elimination.

3. Research the car you chose

Now that you know what you’re looking for, it’s time to dig a little deeper. Look into the safety rating of the car you chose, how well it does on gas mileage or hybrid/electric range, what the color options are, and other factors that are important to you. If you have the time, researching a couple of backup options couldn’t hurt.

4. Start looking locally

Most used car dealerships have websites that you can start to browse at this stage. You can also check online classifieds or websites like Craigslist. When you start looking, you’ll have a better idea of what your options are, if your choice lines up with your budget, or if you need to adjust.

5. Get multiple prices

When it comes to a large purchase like a vehicle, never go with the first option you come across. Look for multiple locations, options, and prices to compare. Comparing prices will help you get the best deal. Used dealerships will likely have pricing guides you can use, and Kelly Blue Book will tell you what the vehicle is worth based on factors like the year and odometer reading. You can also find used cars for sale in your state or ZIP code there.

6. Find the history report

One incredibly useful car-buying tip that most people don’t know about is that you can run history checks on used cars online. All you need is the VIN number. The vehicle history report will reveal details like the ownership information, accident history, status of the title, correct mileage, and more.

7. Plan your visit

Planning ahead for your visit will help ensure that you get what you need out of the meeting. If you’re going to a dealership, schedule a visit so you know that they’ll have the car ready for you, and they’ll be available to help. You’ll also want to check in on your credit score if you’re obtaining funding. If you’re visiting someone’s home to inspect your potential used car, it’s even more important to let them know ahead of time. This way, they can be home and ready for you. It’ll also save you time if they’ve already sold the vehicle but forgot to take the post down. This is also a great time to ask questions.

Before you head out, make sure you’re prepared to take the necessary precautions to keep yourself and others safe. Shopping during the coronavirus pandemic can be tricky but it can still be done safely if you’re careful. Bring your mask and hand sanitizer, keep six feet between yourself and others, and avoid shaking any hands. We’re all in this together, so don’t worry about offending anyone. A wave and a friendly greeting will do.

8. Test drive

Now that you’ve gotten through all of the details, the planning, and the scheduling, you get to do the fun part: test drive! It may be tempting to skip this step if you know what you want, the price is right, and you’re excited to drive off into the sunset with your new used car. But it’ll only take a few minutes to test drive and it’ll help you make sure that this is the right car for you. It’ll also help you confirm that the car is in good shape and doesn’t make any concerning noises or have any issues when you’re braking or accelerating. During your test drive, be sure to turn down the radio (after you test it to make sure it works) and listen for any engine or excessive road noise. Once you’ve ensured there are no issues, then go ahead and crank up those tunes!

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