The Savvy Consumer: Used Car Buying Tips

The Savvy Consumer: Used Car Buying Tips

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New car sales were up again last month in the US, thanks to the federal government’s Car Allowance Rebate System (CARS) program which encouraged people to trade in their clunkers for eligible, new vehicles. As much as new car sales were up, interest in used cars has also remained strong.

New car buyers have had their day in the sun regarding their purchase. How about you? Are you planning to buy a used car this year?

New car buyers have had their day in the sun regarding their purchase. How about you? Are you planning to buy a used car this year?

One negative aspect of CARS is that there are now some 700,000 fewer old cars on the road, vehicles which might have been of interest to buyers. Although that loss is virtually a drop in the bucket considering that there are more than 250 million registered vehicles in the US, prices are affected particularly for sport utility vehicles which were the most traded in cars in the program.

You can’t do anything about supply and demand when it comes to buying a new car, but you can keep in mind six points as you shop for a used car including:

1. Research – Before heading out to a used car lot or visiting a private buyer, determine what that car is actually worth. Kelley Blue Book (KBB) offers excellent information at www.kbb.com which will tell you both the trade in and used car value of most any vehicle dating back to the early 1990s.

2. Negotiate – Don’t ever pay the window price listed for a used car. Most times, those prices have been greatly inflated which means that there is plenty of room for you to demand a better deal.

3. Inspect – Unless you’re particularly gifted with shopping for a car, you’ll want to make sure that you have a thorough inspection of the vehicle accomplished first. If the used car dealer refuses to allow you take the car to your mechanic, then move on. If he agrees, then pay your mechanic to examine the car for potential problems.

4. Contract – Keep this in mind when you prepare to sign a contract to purchase a used car: there isn’t a cooling off period with your purchase. With other contracts, you have 72 hours to cancel but not so with a used car. Once you have signed the contract, then it is yours. Laws may vary from state to state, however.

5. Warranty – What sort of coverage are you getting with your purchase? Will needed repairs be covered? Who is responsible for maintenance? And, does your state have a lemon law that will protect you in the event that things go wrong? Lastly, will purchasing an extended warranty be worth it and what will it cover?

6. Finance – How will you pay for the car? Are you arranging independent financing or will you rely on the dealer to finance your car? Keep in mind that with the used car dealer you could pay an inflated rate for your loan especially if your credit isn’t that good. Expect that the dealer to get a sizable referral commission to maximize his profit too.

Of course, if you buy used, you should run a CARFAX report to make sure that it wasn’t damaged previously. Used cars were reclaimed after hurricanes Katrina and Rita, with unsuspecting buyers snapping them up and running into problems later on.

Adv. — You’re planning to buy a new car, but should you accept dealer financing or shop around for the best deal? If it is a choice between getting a nice rebate or low interest financing, take the money and shop for an auto loan elsewhere. Visit SayLending.com for all of your lending needs including new and used car auto loans at rates you can afford.

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