A used car which is also known as a second hand car or a pre-owned car is a vehicle that is previously owned by one or more owners. Used cars are sold through a variety of franchise and independent dealers and rental car companies. Individuals can also purchase and sell used cars through online and newspaper classifieds.
Purchasing a used car can save a lot of money. A new car depreciates fast in a few years and is worth only about 50-60 percent of the original price after as short period as three years. It is true in general that a new car requires less maintenance initially and during the original warranty coverage period offered by the manufacturer, most of the problems would be covered. Still, buying a new car will not always mean that the buyer will get complete perfection. Buying a used car still involves a bit of a risk – there is no guarantee that the car has been properly maintained. There may be some hidden problems in the engine or automatic transmission that may not be felt when the car is test-driven while buying. Maintenance costs are typically higher for a used car. However, used cars are more preferred these days but some care is exercised before buying. Moreover many car manufacturers offer used cars of previous models under Certified Pre-owned programs where the used cars are inspected and reconditioned and packed with additional warranty coverage.
Steps to buy a used car:
Step 1: which type of car? Typical factors are how may people are to be transported, distance to commute, safety features, mileage, accommodating in the parking area or garage.
Step 2: How much can be afforded? Down payment in a single stroke or determining a realistic monthly payment that will fit into the budget is an important first step.
Step 3: Used car bargains. The price of a used car is based on its brand name, condition, mileage, performance and reliability. Hence, prudent bargaining should be exercised.
Step 4: Research the prospective used car. An online research can also be looked for used cars in the desired price range by reading car reviews, buying tips and safety ratings. Car buying tools which provide model information and side by side feature comparison can be examined. Physical inspection of the interiors and exteriors can be carried out in the first place to satisfy that all the interior components lighting system and tyres are in good condition. Any defective items requiring replacement after the purchase will increase the cost of the used car. A review of the vehicle history report can indicate the details like history of registration, odometer readings, major accidents, lease or Finance details, stolen and warranty check. A check on the VIN (Vehicle Identification Number) can be made by comparing the VIN with the title to the number on the car to make sure they are identical. The VIN is usually located on the dashboard under the windshield, on the door, hood and engine.
Step 5: Finance for the car can be done through Cash, Bank loans or Financing through the dealer. Unless it is planned on purchasing by full payment in cash, it is suggested to get pre-approved financing and the cost of Insurance is also to be factored. Usually the interest rates on a used car will be higher.
Step 6: Used Car markets. Used cars can be bought from Private parties; new car dealerships used car lots and auctions.
Step 7: Test-driving. On a test drive, the aspects like Acceleration from a stop, Engine noise, and Hill-climbing power are to be checked.
Step 8: Negotiation. The foundation of successful negotiation is information. A thorough study on the price prevalence for similar type of cars should be known before buying.
Step 9: Closing the deal. A thorough review of the contract is required. The charges like cost of the vehicle, documentation fee, smog fee, smog certificate, sales tax and license fees are to be understood.
Lemon Law: <>
Lemon laws generally apply to new cars sold to private people. Used car lemon laws cover non leased cars bought from dealers. Some of the steps to avoid buying a lemon are as indicated below:
The VIN # has to be checked. There are possibilities that even a new vehicle might have been damaged or written off and not disclosed by the seller. Obtaining a report from authorized agencies like CARFAX (in Canada and the US), is recommended.
Confirmation in writing should be obtained that “there is no lien“on the vehicle.
An independent mechanical inspection is to be arranged.
All implied or expressed warranties are to be obtained in writing. This is required especially on an used vehicle as normally warranty will not exist. If there is a warranty, period and coverage of the same will have to be obtained in writing.
Salespeople are not mechanics. A copy of the report of the mechanical inspection completed by the dealer and signed by a certified mechanic is to be insisted rather than merely relying on a verbal mechanical report from a salesperson.