Frugal Used Car Buying Tips


Buying a Used Car? Here’s What You Need to Know

used car buying tipsA new car loses 11% of its value the moment you drive it off the lot. After five years, the car has lost more than 60% of its original value, on average. The initial loss in value, plus lower taxes and insurance costs are all part of the advantages of buying a used car.

However, there is a lot more research involved in buying a used car versus a new car to make sure you don’t end up with a lemon. Here are the best used car buying tips you need to know before buying a used car.

Figure Out What You Need

Rather than getting car envy with an attractive looking convertible coupe, figure out what you really need in a car. If you’re a five-person family, you’ll need something kid-friendly. If you haul a lot of materials, you’ll probably need a truck. Deciding what your must-haves are will help you narrow down your focus to a few cars that will meet your needs and steer you away from the attractive but useless features of a shiny looking car.

Research Reliability

The reason used cars get a bad reputation is because you don’t know where that car has been. With a new car, you know you are pretty much covered under warranty.

You can reduce the risk of purchasing a lemon, or even gravitating toward purchasing a lemon, by looking at the reliability of a specific car make and model.

Consumer Reports offers great annual lists that research which used cars are the most reliable and have the best resale value. The Center for Auto Safety also provides information on safety defects, recalls and lemons. Doing your homework and researching reliability of used cars will allow yo to make a wise purchase and save you money on auto repairs.

Know Your Price 

Once you’ve selected which used car you’re leaning toward purchasing, it’s time to narrow down how much you’re willing to pay. It’s a known fact that some cars have better resale value than others.

Consumer Reports and Kelley Blue Book offer great tools on what the cost of a used car should be. A lot of factors go into deciding these prices, such as mileage, features, and wear and tear on the car. Know the retail value of a car before you start negotiating and set a limit on how much you’re willing to spend. Never accept the first offer.

Ready to buy? Get your car’s history 

Whether buying from a dealer or a private party, it’s always necessary to do research on the specific car you are buying. You can research a car’s history with its Vehicle Identification Number, or VIN.

CarFax is a great tool that offers a detailed vehicle history report.  Also having a third-part y mechanic (rather than the dealer’s mechanic) take a look at the car will help reduce any costly surprises later on.

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Buying a used car is a great way to save money, as long as you do your research beforehand and are smart about your purchase.

Readers: Would you consider buying a used car or is the extra cost of a new vehicle worth it to you?

Wal-Mart.com USA, LLC
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18 Responses to Frugal Used Car Buying Tips

  1. Jose 02/12/2013 at 6:45 am #

    One other thing I look at when buying a new car is it’s safety ratings. I was in a pretty bad accident a few years ago and to this day, I believe the fact that the side and curtain airbag saved my life. If everything else checks out but the safety rating is pretty low, I’ll look at another vehicle insted.

  2. Crystal 02/12/2013 at 2:59 pm #

    As a former car form programmer, also remember that everything is negotiable, not just the car. All add-ons, warranties, and insurances are haggleable too. :-) Good luck!

  3. Johnny Moneyseed 02/14/2013 at 11:45 am #

    I feel like every issue we had with our new cars just so happens to not be covered by their respective warranties. I would rather have a used car and save the extra money that I’m saving to fix any possible future issues.

    • Paul 02/18/2013 at 6:32 pm #

      If you have a qualified mechanic go over the used vehicle first you should be able to avoid buying a lemon!

  4. John@MoneyPrinciple 02/14/2013 at 1:45 pm #

    There’s loads to check on a used car, as you indicate.

    The big choice is – do you buy it privately where there is no real redress in case something goes wrong or do you go to a garage where in principle there should be some sort of guarantee.

    The first may be a lot cheaper and the second may just be a rip-off rogue!

    Difficult and actually why we are waiting for the delivery of a brand new car…:-) But we are leasing it for 3 years.

    A car is often the second most expensive thing you buy and of course it loses its value very rapidly. So you have to be careful.

    • Paul 02/18/2013 at 6:34 pm #

      Good point John! With a dealer recourse is much easier than with a private sale. Have an inspection done before you buy either way!

  5. The College Investor 02/15/2013 at 8:56 am #

    Innteresting post and tips on buying used cars! Due to the fast depreciating value of cars, some people find it more convenient to buy a used one and I do agree that that there are really loads to check when it comes to buying a used car, so it is best to check things out before buying anything.

  6. Chris @ StockMonkeys.com 02/15/2013 at 3:22 pm #

    Great tips on buying used vehicles. I remember news reports about being careful after Hurricane Katrina because flooded vehicles were being sold to consumers fraudulently. You can never be too cautious especially when it comes to large sums of money.

  7. Sarah Park 02/17/2013 at 11:37 am #

    Buying used car surely saves a lot of money, but proper considerations of things you showed should be considered properly. But if I have enough money, I would still prefer buying a brand new.

  8. Sarah Park 02/17/2013 at 11:38 am #

    Buying used car surely saves a lot of money, but proper considerations of things you showed should be considered properly. But if I have enough money, I would still prefer buying a brand new.

  9. Melissa 02/18/2013 at 9:33 am #

    So far we have bought new and run the cars into the ground. Our current vehicle is 8.5 years old and has 113,000 miles on it. We have to start thinking about saving to replace it, and I doubt we can pay outright for a new one, so we will likely buy a used one outright in a few years.

    • Paul 02/18/2013 at 6:27 pm #

      I’m looking at 150,000 miles on my truck and plan on keeping it until it dies. Needless to say like you Melissa, I have saved for a down payment so I am ready to buy!

  10. John@ WILDaboutFinance 02/19/2013 at 7:30 am #

    All these aspects are great help, personally I go in there with a price in my head that i’m willing to spend and stick with it. Having been on both sides of the coin (both buyer and seller) its the best way to go about it trust me.

  11. DPF 02/19/2013 at 7:39 am #

    I bought my first used car a few years back, and it’s worked out just great. No problems. Checking the carfax is important I think, as well as taking the car for a good test drive. I’m glad I bypassed buying new, I save a fair amount of money this way.

  12. Pam@Pennysaverblog 03/04/2013 at 4:32 pm #

    We’ve bought both new and used cars and have been happy with most of them. The worst though is when you cannot afford a good vehicle and you end up buying a really old and unreliable one that you continually have to fix. That happened to my husband and I when we were first married. We ended up spending way too much on repairs, but didn’t have much choice.

  13. Brian Eisenmenger 03/07/2013 at 5:50 pm #

    Great article – here is a bit of counter point.

    Yes – a new car depreciates the moment you drive it off of the lot. Get over it. Are you planning on selling it in a few days?

    Ask any car dealer and they will tell you that the real money at a dealership is on the used car lot. The new cars just don’t have the wiggle room and it is easy to comparison shop.

    My thought is to look at the cost of a car new vs. used and then look at how long you keep the car.

    For example – let’s say you are buying a car and you trade it in at 120,000 miles. A new car costs $30,000; the used car costs $20,000. Then take the cost per mile. The cost per mile of the new car is $0.25 per mile ($30,000/120,000). Therefore the breakeven on the used car would be 40,000 miles (($20,000 / (120,000-40,000)). A used car with less than 40,000 miles would be a good deal. A car with more than 40,000 miles would be a bad deal. Remember that you need to consider the bells and whistles (ie technology package vs. w/o) to do an apples to apples comparison.

    But don’t forget – with the new car, you know every mile and every scratch on the car. Too, if you buy a used car with 40,000 miles, expect to put on some tires ($1,000) plus consider the added maintenance that will come sooner than on the new car.

    Just a thought.

    • Paul 03/08/2013 at 9:10 pm #

      Good points Brian! Like any major purchase, you need to do your due diligence.

  14. Will Van Hartog 03/08/2013 at 2:42 pm #

    Always check there isn’t any rust as well!!Rust will depreciate the value of a car!

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