Vehicle depreciation makes buying a brand new vehicle a dubious investment even for the wealthiest citizens. After just one year, a new car worth $20,000 at initial appraisal will be worth only $16,200. However, there are disadvantages to buying used cars as well. Most notably, you won’t get any kind of manufacturer warranty (though you may get some type of coverage from your dealer or seller), and it’s oftentimes hard to tell just what kind of condition the vehicle is in, including how it’s been driven and taken care of by its previous owners.
Still, used cars can be a valuable investment for your daily travels-so long as you know what to check before you buy.
Top Things to Check
Before buying any used vehicle, you’ll want to employ the following strategies:
1. Run a thorough visual inspection.
Don’t rely on images you see listed in an advertisement or product listing; these can be misleading and may be from many years ago. Instead, see the vehicle in person and run a thorough visual assessment of both the interior and the exterior. Look for even minor points of damage, such as scrapes, rust, or structural defects, and make sure they don’t interfere with the performance of the vehicle (and make sure they’re accounted for in the asking price of the vehicle). If you aren’t able to inspect the vehicle in person, you can use a service like WeGoLook to order a visual report on the vehicle of your choice.
2. Vehicle history.
Sometimes, vehicles can experience wear and tear that makes them less valuable-even if you can’t see it. It’s a good idea to run a vehicle history report, which will tell you about the car’s history, including how it’s been serviced, if it’s been subject to any recalls, and if it’s been involved in any collisions in the past. Carfax and AutoCheck are two of the best-known providers here, but you can run a report through any major service so long as you have the vehicle’s VIN. Some used car dealerships will also provide you with a copy of the vehicle history report for free.
3. The seller’s credibility.
Not all outlets are equal for getting a high-quality used vehicle. Buying from a total stranger off a Craigslist ad carries significantly more risk than buying from a certified used car dealership that has years’ worth of positive reviews online. Research your seller before you buy.
4. The feel on the road.
Never buy a used car before you’ve had the chance to drive it on the road. Even after a thorough inspection, and after investigating both the vehicle’s history and the seller’s reliability, it’s possible that there are unseen problems with the vehicle that prevent it from being a worthwhile purchase. Some of these may include functional problems, such as braking difficulty or strange noises, but some of them may be purely aesthetic-though still significant. For example, the vehicle may not have enough legroom for you, or may not steer in a way that feels natural to you.
5. The car’s market value.
You should also be prepared with research that demonstrates the car’s fair market value. For used car valuations, Kelley Blue Book is still the trusted name, but you might want to get two or three separate estimates to back up your argument. Be sure to include factors like physical defects and the history of the vehicle; these will have a significant bearing on the car’s overall worth. Once you have the price the car “should” be selling at, you’ll have evidence on how to proceed further. If the price is far below market value, you should probably be asking more questions-and have the vehicle undergo a thorough inspection. If the price is above market value, it’s in your best interest to either negotiate a better deal or walk away.
Once you’ve run the preliminary tests and considerations listed above, there are a few additional thoughts you’ll need to bear in mind. For example, is the vehicle covered by any kind of warranty or maintenance plan? Some sellers may offer a complimentary repair service for anything that goes wrong with the vehicle within a few years of your purchase. How are you going to finance the car, if you’re financing at all?
Your used vehicle is a significant investment, so don’t underestimate it. The more work you put into your purchase, the more likely it will be to pay off.