buying a used car essay

Buying a Car Essay

Question 1: what is the role of the peer group in car purchase, question 2: why are there so many websites offering help with buying used cars, question 3: how might the average person reduce risk when buying a car, question 4: why is used car purchase so risky, question 5: what would you expect the purchase process for a car to encompass.

Nowadays, buying a car is one of the most common activities in the modern world. Despite being a definer of one’s socioeconomic status and reflection of one’s financial prosperity, consulting a group of peers when purchasing a car may help avoid some mistakes. Using the assistance of a friend when buying a used car is critical.

In the first place, he/she will help see whether all the obligations are followed by both parties. Alternatively, a friend or relative may provide all the necessary support and increase the buyer’s effectiveness in the negotiations process. Overall, peer groups can minimize the financial losses and select a car, which complies with all the needs and preferences of the buyer.

Nowadays, buying a car is challenging, as it requires a substantial financial investment and is one of the most important conveniences that help people to navigate around the city. Nonetheless, not all people can afford new products, and the used ones are gaining popularity. Overall, it could be said that the factors highlighted above underline that purchasing a car is a difficult decision to make.

This purchase is associated with many risks and threats and involves a high level of responsibility. It could be said that these matters create favorable conditions for the intensified competition and attract more and more companies to assist the potential customers in the buying process of the used cars.

It is evident that buying a car is a complicated process. In the first place, any buyer has to understand the main features of the preferred model. Alternatively, to reduce the risks, one can use Top Gear’s and Yahoo’s advisory services and guidance and consult the Automobile Association and the Royal Automobile Club.

These services will assist in selecting the right time, place, and date to buy a car and propose relevant techniques, which will ease the process of negotiations. Lastly, using the help of a friend or relative will offer support and help select the most suitable car model.

As it was mentioned earlier, buying a car involves an extended variety of risks. Nevertheless, the used-car market is more challenging. In the first place, it requires making a significant financial investment. Alternatively, not meeting the expectations of the buyer and the inability of the seller to comply with obligations are other major challenges.

At the same time, the buyers can make mistakes in negotiations and apply wrong decision-making techniques, which will question the relevance of the purchase. Overall, a combination of these factors helps understand the potential reasons for the presence of high risks when purchasing cars or any other types of vehicles in the goods market.

In the first place, the purchasing process has to start with conducting research about the desired car model and potential sellers. Using Top Gear’s website or any governmental services will help find the trusting stores and locations and provide guidance for the documentation and negotiations’ procedures.

After that, listing and contacting all the suitable sellers will assist in selecting the most relevant deals. Negotiations can be viewed as the next step in buying a car since this process can decrease the financial expenses. Using the help of a friend or relative will assist in seeing whether all documentation and car’s features meet the requirements highlighted by its owner.

• Chicago (A-D)
• Chicago (N-B)

IvyPanda. (2024, January 25). Buying a Car. https://ivypanda.com/essays/buying-a-car/

"Buying a Car." IvyPanda , 25 Jan. 2024, ivypanda.com/essays/buying-a-car/.

IvyPanda . (2024) 'Buying a Car'. 25 January.

IvyPanda . 2024. "Buying a Car." January 25, 2024. https://ivypanda.com/essays/buying-a-car/.

1. IvyPanda . "Buying a Car." January 25, 2024. https://ivypanda.com/essays/buying-a-car/.

Bibliography

IvyPanda . "Buying a Car." January 25, 2024. https://ivypanda.com/essays/buying-a-car/.

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

By Olatunji Osho-Williams

Whether you’re buying your first car from a family friend or scouring Facebook Marketplace for a new addition to your automotive collection, buying a used car can be a stressful process. Here’s some advice from the Cars.com Editorial team on how to get the best deal on a used car.

Related: What’s the Best Time of Year to Buy a Car?

Set a Budget

Determining what you can afford is the first step toward buying a used car. The average list price of a used car hovers around $28,859 , making it still an expensive investment.

Additionally, maintenance costs are key to keep in mind when setting your budget. The estimated annual repair costs for some luxury brands can amount to roughly double that of a Toyota or Honda.

Paying for a Used Car

The two main ways to pay for a car are to pay in full or finance. When paying in full, make sure to save money for additional costs, such as registration fees and insurance. Financing may be tempting due to low monthly payments, but it will increase the total amount you pay for the car due to the amount of interest.

Paying in full

Paying in full can keep your financial future free from monthly interest payments and can help you save on your bottom line. When paying in full, the best methods are likely arranging a wire transfer with your bank or a cashier’s check. A downside, however, is that your choice of vehicle may be limited if you have a tight budget .

Financing may widen the range of vehicles you can purchase, since the immediate price is not as hard of a limiting factor. Evaluating your budget and financing options ahead of time can give you negotiating power when the time comes to talk numbers, and shopping around to compare offers can help you get the best deal possible. Banks and credit unions can help you determine financing options.

It’s also important to get preapproved for a car loan if you need one. Getting preapproved for a loan, which you can do even when buying from a private seller, will give you more confidence when comparing offers and negotiating with the seller or dealership. Keep in mind, though, that most banks have restrictions on a used vehicle’s age and mileage for a loan, whereas some credit unions may be a little more lenient.

Related Articles:

• Can You Afford Your Car?
• Inside the Finance and Insurance Room
• Auto Loan Basics for First-Time Buyers
• What You Need to Get a Car Loan

Do Your Research

Getting a clear picture of what you are looking for in a vehicle will help with your decision. Start by reading online reviews on the vehicle’s reliability and fuel economy figures to help you narrow your choices, and check what other sellers are offering for the vehicle to determine if you are paying a fair price. Cars.com has buying guides, research and reviews for all types of cars, ranging from pickups to SUVs.

Ordering a CarFax or AutoCheck report will give a thorough vehicle history, with information on past owners, recorded maintenance, previous accidents and outstanding recalls . To learn more about any recalls the vehicle may have, the National Highway Traffic Safety Administration’s website allows users to check a vehicle’s current recalls by its vehicle identification number or year, make and model.

Don’t just research the vehicle, either; doing your homework on the dealership or private seller can be of use, too. For example, Facebook Marketplace provides seller ratings, which can help unveil red flags and provide a record of previous transactions. For dealerships, you can read reviews of the dealership online or contact your local- and state-level consumer protection agencies to learn about unresolved complaints filed about a particular dealer.

Private Seller or Dealership

Buying from a private seller or dealership comes with their own host of pros and cons. Here are some tips to help you make an informed decision on purchasing from either.

Private seller

Buying from a private seller can provide you with a more reasonable price than a dealership, and if you have a specific vehicle in mind, you may have more luck buying that exact make and model from an individual rather than a dealership.

When buying from a private seller, the responsibility of handling the documents of the transaction falls on the buyer and seller. Documentation to complete an individual vehicle sale changes by state, but the most important document is the title.

Additionally, safety is crucial when meeting with a private seller. Be sure to meet the seller with a friend and/or in a public place during the day, such as a grocery store parking lot, bank or police station. If you are going to test drive the vehicle, take a photo of the seller’s license and send it to a friend who’s not currently with you.

You also shouldn’t pay for the car in cash; use a money order or cashier’s check instead. Before paying for the vehicle, ensure the seller has the legal right to sell the vehicle by comparing their ID with the title. If the car has not been paid off yet, you can reach out to the seller’s lender to get the payoff amount, because after the purchase, you may be responsible for paying off their car loan, as well.

Dealerships offer a wide range of vehicles, giving shoppers more options when looking for the right car. When completing the purchase, dealerships will handle the paperwork, and you can likely finish the transaction all in one day.

However, prices will likely be higher at dealerships than with private sellers since their goal is always to turn a profit. Dealerships may also offer optional products and services at the end of a purchase, so be sure to know what those include , whether they’ve been added to the vehicle and whether you want them.

The Federal Trade Commission requires car dealerships to display and provide consumers with a Buyers Guide disclosing important vehicle and purchasing information. The guide discusses major mechanical issues, the car’s warranty, what costs the dealer will pay under the warranty and additional advice. If the deal is done in Spanish, dealerships are required to provide a Spanish version of the guide.

There are several types of warranties offered when buying a car from a dealership: full and limited written warranties, implied warranties and extended warranties; the vehicle may also be sold as-is. Warranties may also be described by the parts of the vehicle covered under the contract, such as a powertrain warranty or a bumper-to-bumper warranty.

When buying a car, the manufacturer’s warranty may still be in effect; if it is, ask the dealer for a copy of the car’s warranty documents and verify the information with the VIN. Car warranties are valid for a period of time or a set number of miles, whichever comes first.

Full and limited warranties

Full and limited warranties may cover some or all of a car’s components and systems. Bumper-to-bumper coverage falls under these types of warranties.

Full warranty

A full warranty might cover repair or replacement of any part of a car that was damaged regardless of use. It must also meet the federal government’s minimum standards for comprehensive warranties. By FTC guidelines , a full warranty includes five things:

• no limitation on the duration of implied warranties,
• the warranty service is provided to anyone who owns the vehicle during the warranty’s period
• the warranty service is provided at no charge
• the warranty will guarantee a replacement or full refund if the vehicle is unable to be repaired after numerous tries
• the customers do not have to perform a duty as a precondition for service, outside of notification of the requested service, unless it is demonstrated that the duty is reasonable

Limited warranty

A warranty is considered limited if any of the above conditions aren’t true. A limited warranty might cover only key vehicle components, but only under certain circumstances and uses.

Implied warranties

If a used car doesn’t come with a written warranty, there’s an implied warranty. The FTC explains that “implied warranties are unspoken and unwritten promises from the dealer to buyer.” If you have problems that aren’t covered by a written warranty, see if there’s protection from one of these implied warranties.

• Implied warranty of merchantability: This type of implied warranty means that the dealer agrees the car will run and promises its basic functions.
• Implied warranty of fitness: This type of implied warranty applies for when a consumer buys a car for a particular activity, such as hauling a trailer, based on a dealer’s advice.

Implied warranty coverage can last up to four years, but the length of coverage varies from state to state. A lawyer or a state consumer protection office can tell you more about implied warranty coverage in your state.

Extended warranties

An extended warranty is a vehicle service contract that continues past the manufacturer’s warranty period expiration date; some are offered by the automaker or affiliated company, while others are offered by independent companies.

Dealers can also sell cars as-is, meaning the dealer won’t pay for any needed repairs, and you are liable for any damage sustained after the sale. Most cars from private sellers are bought as-is.

Inspecting the Car

An inspection of a used vehicle before purchase will ensure you’re paying for a reliable vehicle and let you know of any glaring issues. While you should conduct your own visual inspection and test drive the vehicle, you should also have a professional take a look at the car; either bringing a mechanic along to inspect the vehicle or bringing the vehicle to an auto repair shop works. Be sure to ask the mechanic for a written report and an estimate of the cost of possible repairs. If the seller doesn’t allow an independent mechanical inspection, consider that a glaring red flag that they may be hiding something.

• How to Inspect a Used Car
• What Should a Used-Car Inspection Include?

Certified Pre-Owned Cars

Some dealerships may have an inventory of certified pre-owned cars. CPO cars are inspected by either a dealer or third party to meet minimum quality standards and often include some type of warranty. These are a popular choice for vehicle buyers; however, a CPO sticker can increase the cars price from 2% to 8% of the original used-car price.

• Tips to Buying a CPO Car
• Certified Pre-Owned
• CPO Pros and Cons Versus Extended Warranty

Too Good to Be True

These days, scams are widespread, and getting the best deal for your money is always the end goal. Don’t be afraid to walk away from a purchase at any time. Red flags from a private seller can include no buyer reviews or history, resistance to an independent inspection or test drive, as well as odd requests about electronic payment.

While a mechanical inspection and vehicle history report can inform your choice to buy, here are some common scams to be wary of.

Odometer fraud

Odometer fraud is the alteration of a vehicle’s odometer to present less miles than actually driven. NHTSA estimates over 450,000 vehicles are sold each year with false odometer readings, costing car buyers over $1 billion each year.

To see if there are any warning signs as to whether the odometer was tampered with, check and compare the mileage on the car’s title with that on the odometer, and be sure the mileage on the title isn’t obscured or hard to read. You can also examine the wear and tear on the vehicle’s pedals and tires to see if it’s appropriate for the miles displayed on the odometer. If an odometer has less than 20,000 miles, it should have the original tires.

Title washing

Title washing is when a seller (usually a private seller) removes information, such as a branded title for a salvaged or lemon car to create a “clean” title that conceals a car’s issues and inflates its value. This can occur when the seller brings a vehicle to a different state where the vehicle’s brand is not recognized, alters the title or applies for a new title with misrepresented information. A washed title can also hide if the vehicle was stolen.

Buying a used car with a washed title can leave the unknowing buyer with a vehicle with severe mechanical issues. Buyers can avoid this by comparing the provided title against an independently ordered vehicle history report, inspection or information provided by an inspection company.

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Chapter 8: Consumer Strategies

8.2 a major purchase: buying a car, learning objectives.

• Show how the purchasing process (e.g., identifying the product, the market, and the financing) may be applied to a car purchase.
• Explain the advantages (and disadvantages) of leasing versus borrowing as a form of financing.
• Analyze all the costs associated with car ownership.
• Define “lemon laws.”

Many adults will buy a car several times during their lifetimes. A car is a major purchase. Its price can be as much as or more than one year’s disposable income. Its annual operating costs can be substantial, including the cost of fuel, legally mandated insurance premiums, and registration fees, as well as maintenance and perhaps repairs and storage (parking). A car is not only a significant purchase, but also an ongoing commitment.

In the United States, people spend a considerable amount of time in their cars, commuting to work, driving their children to school and various activities, driving to entertainment and recreational activities, and so on. Most people want their car to provide not only transportation, but also comforts and conveniences. You can apply the purchasing model, described in this chapter, to the car purchase.

First, you identify the need: What is your goal in owning a car? What needs will it fulfill? Here are some further questions to consider:

• What kind of driving will you use the car for? Will you depend on it to get you to work, or will you use it primarily for weekend getaways?
• Do you need carrying capacity (for passengers or “stuff”) or hauling capacity?
• Do you live in a metropolitan area where you will be driving shorter distances at lower speeds and often idling in traffic?
• Do you live in a more rural area where you will be driving longer distances at faster speeds?
• Do you live in a climate where winter or a rainy season would make traction and storage an issue?
• How much time will you spend in the car every day?
• How many miles will you drive each year?
• How long do you expect to keep the car?
• Do you expect to resell or trade in the car?

Your answers to these questions will help you identify the product you want.

Identify the Product

Answering these questions can help identify the attributes you value in a car, based on how you will use it. Cars have many features to compare. The most critical (in no particular order) are shown in Figure 8.9 “Automobile Attributes and Relevance” .

Figure 8.9 Automobile Attributes and Relevance

All these attributes affect price, and you may think of others. Product attribution scoring can help you identify the models that most closely fit your goals.

Mary lives on a dirt road in a rural area; she drives about 18,000 miles per year, commuting to her job as an accountant at the corporate headquarters of an auto parts chain and taking her kids to school. She is also a pretty good car mechanic and does basic maintenance herself.

John lives in the city; he walks or takes a bus to his job as a market researcher for an ad agency, but keeps a car to visit his parents in the suburbs. He drives about 5,000 miles per year, often crawling in traffic. All John knows about a car is that the key goes in the ignition and the fuel goes in the tank.

John and Mary would rate these attributes very differently, and their scoring of the same models would have very different results.

Mary may value fuel efficiency more, as she drives more (and so purchases more fuel). Driving often and with her children, she may rank size, safety, and entertainment features higher than John would, who is in his car less frequently and alone. Mary relies on the car to get to work, so reliability would be more important for her than for John, who drives only for recreational visits. But Mary also knows that she can maintain and repair some things herself, which makes that less of a factor.

Car attributes are widely publicized by car dealers and manufacturers, who are among the top advertisers globally year after year. Advertising Age, “Global Marketers: Top 100,” December 8, 2007, http://adage.com/images/random/datacenter/2008/globalmarketing2008.pdf (accessed April 1, 2009). You can visit dealerships in your area or manufacturers’ Web sites. Using the Internet is a more efficient way of narrowing your search. Specialized print and online magazines, such as Car and Driver , Road and Track , and Edmunds.com , offer detailed discussions of model attributes and their actual performance. Consumer Reports also offers ratings and reviews and also provides data on frequency of repairs and annual maintenance costs.

You want to be sure to consider not only the price of buying the car, but also the costs of operating it. Fuel, maintenance, repair, insurance, property taxes, and registration may all be affected by the car’s attributes, so you should consider operating costs when choosing the product. For example, routine repairs and maintenance are more expensive for some cars. A more fuel-efficient car can significantly lower your fuel costs. A more valuable car will cost more to insure and will mean higher property (or excise) taxes. Moreover, the costs of fuel, maintenance, insurance, registration, and perhaps property tax on the car will be ongoing expenses—you want to buy a car you can afford and afford to drive.

If you are buying a new car, you know its condition, and so you can predict annual maintenance and repair costs and the car’s longevity by the history for that model. Depending on how long you expect to own the car, you may also be concerned with its predicted resale value.

Used cars are generally less expensive than new. A used car has fewer miles left in it. Its condition is less certain: you may not know how it has been driven or its repair and maintenance history. This makes it harder to predict annual maintenance and repair costs. Typically, since it is already used when you buy it, you expect little or no resale value. You can gain a significant price savings in the used car market, and there are good used cars for sale. You may just have to look a bit harder to find one.

The National Automobile Dealers Association (NADA) offers a checklist for used vehicle inspection when buying a used car. The NADA also publishes guidebooks on used car book values (see http://www.nadaguides.com ). Items to inspect in your exterior, interior, and engine checks are outlined in Figure 8.10 “Used Car Buyer’s Checklist” .

Figure 8.10 Used Car Buyer’s ChecklistNational Automobile Dealers Association, http://www.nadaguides.com (accessed November 23, 2009).

The condition of exterior and interior features can indicate past accidents, repairs, or lack of maintenance that may increase future operating expenses, or just driving habits that have left a less attractive or less comfortable vehicle.

Services like Carfax ( http://www.carfax.com ) provide research on a vehicle’s history based on its VIN (vehicle identification number), including any incidence of accidents, flooding, frame damage, or airbag deployment, the number and type of owners (was it a rental or commercial vehicle?), and the mileage. All these events affect your expectations of the vehicle’s longevity, maintenance and repair costs, resale value, and operating costs, which can help you calculate its value and usefulness.

Unless you are an expert yourself, you should always have a trained mechanic inspect a used vehicle before you buy it. With cars, as with any item, the better informed you are, the better you can do as a consumer. Given the cost of a car and its annual expense, there is enough at stake with this purchase to make you cautious.

Identify the Market

New cars are sold through car dealerships. The dealer has a contract with the manufacturer to sell its cars in the retail market. Dealers may also offer repair and maintenance services as well as parts and accessories made especially for the models it sells.

New car dealers may also resell cars that they get as trade-ins, especially of the same models they sell new. Used car dealers typically buy cars through auctions of corporate, rental, or government cars.

Individuals selling a used car can also do so through networking—in an online auction such as eBay, a virtual bulletin board such as Craig’s List, or the bulletin board in the local college snack bar. Dealers will have more information about the market, especially about the supply of cars and price levels for them.

Some people prefer a new car, with its more advanced features and more certain quality, but a used car may be a viable substitute for many purchasers. Many people buy used cars while their incomes are lower, especially in the earlier stages of their adult (working) life. As income rises and concern for convenience, reliability, and safety increases with age and family size, consumers may move into the new car market.

While they are two very different markets, the markets for new and used cars are related. Supply of and demand for new cars affect price levels in the new car market, but also in the used car market. For example, when new car prices are high, more buyers seek out used cars and when low, used car buyers may turn to the new car market.

Demand for cars is affected by macroeconomic factors such as business cycles and inflation. If there is a recession and a rise in unemployment, incomes drop. Demand for new cars will fall. Many people will decide to keep driving their current vehicle until things pick up, unwilling to purchase a long-term asset when they are uncertain about their job and paycheck. That slowing of demand may lower car prices, but will also lower the resale or trade-in value of the current vehicle. For first-time car buyers, that may be a good time to buy.

If there is inflation, it will push up interest rates because the price of borrowing money rises with other prices. Since many people borrow when purchasing a car, that will make the borrowing, and so the purchase, more costly, which will discourage demand.

When the economy is expanding, on the other hand, and inflation and interest rates are low, demand for new cars rises, pushing up prices. In turn, prices are kept in check by competition. As demand for new cars rises, demand for used cars may fall, causing the supply of used cars to rise as more people trade in their cars to buy a new one. They trade them in earlier in the car’s life, so the quality of the used cars on the market rises. This may be a good time to buy a used car.

Identify the Financing: Loans and Leases

The cost of a car is significant. Car purchases usually require financing through a loan or a lease. Each may require a down payment, which you would take out of your savings. That creates an opportunity cost of losing the return you could have earned on your savings. You also lose liquidity: you are taking cash, a liquid asset, and trading it for a car, a not-so-liquid asset.

Your opportunity cost and the cost of decreasing your liquidity are costs of buying the car. You can reduce those costs by borrowing more (and putting less money down), but the more you borrow, the higher your costs of borrowing. If you trade in a vehicle, dealers will often use the trade-in value as the down payment and will sell the car to you with “no money down.”

Car loans are available from banks, credit unions, consumer finance companies, and the manufacturers themselves. Be sure to shop around for the best deal, as rates, maturity, and terms can vary. If you shop for the loan before shopping for the car, then the loan negotiation is separate from the car purchase negotiation. Both may be complex deals, and there are many trade-offs to be made. The more separate—and simplified—each negotiation is, the more likely you will be happy with the outcome.

Loans differ by interest rate or annual percentage rate (APR) and by the time to maturity. Both will affect your monthly payments. A loan with a higher APR is costing you more and, all things being equal, will have a higher monthly payment. A loan with a longer maturity will reduce your monthly payment, but if the APR is higher, it is actually costing you more. Loan maturities may range from one to five years; the longer the loan, the more you risk ending up with a loan that’s worth more than your car.

Rebecca buys a used Saturn for $6,000, with $1,000 cash down from savings and a GMAC-financed loan at 7.2 APR, on which she pays $115 a month for forty-eight months. She could have gotten a twenty-four-month loan, but wanted to have smaller monthly payments. After only twenty-five months, she totals her car in a chain collision but luckily escapes injury. Now she needs another car. The Saturn has no trade-in value, her insurance benefit won’t be enough to cover the cost of another car, and she still has to pay off her loan regardless. Rebecca is out of luck, because her debt outlived her asset. If your debt outlives your asset, your ability to get financing when you go to replace that vehicle will be limited, because you still have the old debt to pay off and now are looking to add a new debt—and its payments—to your budget. Rebecca will have to use more savings and may have to pay more for a second loan, if she can get one, increasing her monthly payments or extending her debt over a longer period of time.

An alternative to getting a car loan is leasing a car. Leases are a common way of financing a car purchase. A lease [1] is a long-term rental agreement with a buyout option [2] at maturity. Typically, at the end of the lease, usually three or four years, you can buy the car outright for a certain amount, or you can give it back (and buy or lease another car), which removes the risk of having an asset that outlives its financing. Leases specify an annual mileage limit, that is, the number of miles that you can drive the car in a year before incurring additional costs. Leases also specify the monthly payment and requirements for routine maintenance that will preserve the car’s value.

So, lease or borrow? The price of the car should be the same regardless of how it is financed—the car should be worth what it’s worth, no matter how it is paid for. The cost of borrowing, in percentage terms, is the interest rate or APR of the loan. The costs of leasing, in dollars, are the down payment, the lease payments, and the buyout. Since the price of the car itself is the same in either case, the present value of all the lease costs should be the same as the price of the car. You can use what you know about the time value of money to calculate the discount rate that produces that price; that is the equivalent annual cost of the lease, in percentage terms.

For example, you want to buy a car with a price of $19,000. You can get a car loan with an APR of 6.5 percent from your bank. You are offered a lease requiring a down payment of $2,999, monthly payments of $359 for three years, and a final buyout of $5,000. The APR of the lease is actually 5.93 percent, which would make it the cheaper financing alternative.

In general, the longer you intend to keep the car, the less sense it makes to lease. If you typically drive a car “into the ground,” until it costs more to repair than replace it, then you are better off borrowing and spreading the costs of financing over a longer period. On the other hand, if you intend to keep the car only for the term of the lease and not to exercise the buyout option, then it is usually more cost effective to lease. You also need to consider whether or not you are likely to stay within the mileage limits of the lease, as the mileage penalties can add significantly to your costs.

Some people will say that they like to borrow and then “own” in order to have an asset that can store value or “build equity.” Given the unpredictable nature of the used car market, however, a car is really not an asset that can be counted on to store value. Thinking of a car as something that you will use up (although over several years) rather than as an asset you can preserve or save will help you make better financial decisions.

When you are buying a car, you want to minimize the cost of both the car and the financing. If you are purchasing both the car and the financing from the same dealer, you should be careful to discuss them separately. Car dealers, who offer loans and leases as well as cars, often combine the three discussions, offering a break on the financing to make the car more affordable, or offering a break on the car to make the financing more affordable. To complicate matters further, they may also offer a rebate on a certain model or with a certain lease. The more clearly you can separate which costs belongs to which—the car or the financing—the more clearly you can understand and minimize your costs.

Purchase and Postpurchase

A car purchase requires significant prepurchase activities. Once you have identified and compared appropriate car attributes, a seller, and financing options, all you have to do is drive away, right? Not quite.

Car purchases are one instance where the buyer is expected to haggle over price. The sticker price is the manufacturer’s suggested retail price (MSRP) [3] for that vehicle model with those features. Dealers negotiate many of the factors that ultimately determine the value of the purchase: the optional features of the car, the warranty terms, service discounts on routine maintenance, financing terms, rebates, trade-in value for you old car, and so on.

As more of these factors are discussed at once, the negotiation becomes more and more complex. You can help yourself by keeping the negotiations as simple as possible: negotiate one thing at a time, settle on that, and then negotiate the next factor. Keep track of what has been agreed to as you go along. When each factor has been negotiated, you will have the package deal.

Your ability to get a satisfying deal rests on your abilities as a negotiator. For this reason, many people who find that process distasteful or suspect that their skills are lacking find the car purchasing process distasteful. Dealers know this, and some will try to attract customers by being more transparent about their own costs and about prices. Some even promise the “no-dicker sticker” sale with no haggling over price at all.

As with any product in any market, the more information you have, the better you can negotiate. The more thorough your prepurchase activities, the more satisfying your purchase will be.

While you own the car, you will maximize the benefits enjoyed by operating the vehicle safely and by keeping it in good condition. Routine maintenance (e.g., replacing fluids, rotating tires) can ensure the quality and longevity of your vehicle. New cars come with owner’s manuals that detail a schedule of service requirements and good driving practices for your vehicle. You will be required to keep the car legally insured and registered with the state where you reside, and you must maintain a valid license to drive.

New cars, and some used cars, are sold with a warranty [4] , which is a promise about the quality of the product, made for a certain period of time. The terms and covered repair costs may vary. You should understand the terms of the warranty, especially if something covered should need servicing, so that you know what repairs you may be charged for. The manufacturer, and sometimes the seller, issues the warranty. If you have questions about the warranty after purchasing, it may be best to contact the manufacturer directly.

If you are dissatisfied with your purchase (and the fault seems to be with the car), your first step should be a conversation with your dealer. If the problem is not addressed, you can contact the automobile company directly; its Web site will provide you with a customer service contact. If the dealer and the manufacturer refuse to make good, you should contact your state’s consumer affairs division in the attorney general’s office. In some states, there are entire state agencies or departments devoted to auto purchases.

For his first car Ray bought a ten-year-old coupe with only 60,000 miles on it for a price that seemed too good to be true. The seller said the good price was in exchange for getting payment in full in cash. The car broke down right away, however, and within two weeks died of a cracked block. When Ray complained, the seller claimed he didn’t know about the cracked block and pointed out that there was no warranty on the car, so Ray was out of luck. Fortunately, Ray had read that a defective car, referred to as a “lemon,” is covered under laws that protect consumers who unknowingly purchase a car that proves to be defective. Lemon laws [5] regulate sales terms, purchase cancellation conditions, and warranty requirements. These laws are enforced on both the federal and state level in the United States. Other consumer protection laws apply specifically to motor vehicles and vary by state. Ray learned that laws in his state include used cars as well as new ones, and when he told the seller, he was able to get most of his cash back.

Key Takeaways

• The purchase process may be applied to a car purchase.
• Attribute scoring may be helpful to identify the product.
• Common car financing is through a loan or a lease.
• A warranty guarantees minimal satisfaction with performance attributes.
• Laws protect consumers who are dissatisfied with their car purchases or unknowingly buy defective cars.
• Perform an attribute analysis for your next new or used car. Go online to research cars with the attributes you have prioritized, and find where you could buy what you want locally. Then research the dealership, including a quick check at the Better Business Bureau Web site or your local chamber of commerce to learn if there have been many consumer complaints. After researching the product, the market, and the price, visit a dealership, preferably with a classmate or partner, for the experience of getting information and practicing your negotiation skills (but without making any commitments, unless you really are in the market for a car at this time).
• How will you finance a car? Play with the Car Loan Calculator at http://www.edmunds.com/apps/calc/CalculatorController . First identify a sample of new or used cars you would like to own, and for each choice calculate what your down payment, monthly loan payments, and term of payment would be. How much would you need to buy a car and where would that money come from? How much could you afford to pay each month and for how long? How could you modify your budget to accommodate car payments?
• For a car you would like to drive, calculate and compare what it would cost you to buy it and to lease it. Use the Lease versus Buy Calculator at http://www.leaseguide.com/leasevsbuy.htm . What would be the advantages of owning the car? What would be the advantages of leasing it? For your lifestyle, needs, and uses of a vehicle, should you buy or lease?
• View a 2009 Money Talks video on “Buying Cars in a Credit Crunch” at http://articles.moneycentral.msn.com/video/default-ap.aspx?cp-documentid=f5dda393-7ab1-4e25-b446- 30e313aa3796%26tab=Money %20Talks%20News . What sources of financing does the video identify for times when national banks and finance companies are not forthcoming with car loans because of downturns in the economy?
• Check the lemon laws in your state at Lemon Law America’s Web site: http://www.lemonlawamerica.com/ . Click on your state on the map. What conditions do your state lemon laws cover? Some states do not cover used or leased cars under lemon laws. Under federal laws, if you buy a used car “as is,” do you still retain rights under the lemon laws? Under federal lemon laws, in what situations, when the seller does not divulge the information, may you be able to get your money back on a car?
• A rental agreement used as a form of financing for automobile purchases. ↵
• A feature of a lease that offers the option to buy the asset financed by the lease at the end of the lease term. ↵
• The “sticker price” for an item. ↵
• A manufacturer’s guarantee of product performance for a period of time. ↵
• Federal and state laws protecting consumers against products that repeatedly fail to meet standards of performance. The federal Magnuson-Moss Warranty Act was enacted in 1975. ↵
• Personal Finance. Provided by : Saylor Academy. Located at : https://saylordotorg.github.io/text_personal-finance . License : CC BY-NC-SA: Attribution-NonCommercial-ShareAlike

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Complete Guide: How to Buy a Used Car

Buying a pre-owned car can be a great way to save money. Here's how to find the right used car, get the best auto loan, and negotiate your used car purchase.

How to Buy a Used Car

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Car salesman with customer signing paperwork to buy used car

Buying a used car instead of a new model is the single easiest way to save money on a vehicle purchase. New cars rapidly depreciate the second you drive away from the dealership, losing a big chunk of their value in the first couple of years you own them. When you purchase a used car, you let its first owner take the pain of the steep depreciation, and you reap the savings when you buy the car for a much lower price than the original owner did.

A used car can require higher maintenance costs if it's out of warranty, and its financing might be a little more expensive than a new car loan. But if you buy the right pre-owned car at the right price, you can save a tremendous amount of money. The keys to a successful used-car purchase include choosing models with high predicted reliability scores, avoiding problem vehicles and knowing what you should pay.

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While you can save a ton of money, it's important to remember that buying a pre-owned car can be more complicated than purchasing a brand-new vehicle, and it's more financially risky because you usually won't get factory warranty coverage. Lingering effects of the COVID-19 pandemic have made buying a used car more expensive than it once was, and backlogs at state DMV offices can make registering a private-party used car more challenging.

This guide is designed to take you through the steps you'll want to follow to find the right used car, secure the best financing deal and negotiate a fair price. By following these steps, you can minimize the chances you'll be stuck with a vehicle that's overpriced, unsafe or unreliable.

1. Set a Car-Buying Budget You Can Afford

Setting a used-car buying budget isn’t as simple as looking for a pre-owned car, truck, or SUV that gets a monthly payment you think can manage. While the monthly payment does need to be affordable, you need to look beyond it to get a proper idea of the total cost of owning the car. That includes the cost of interest on your car loan, how much you’ll have to pay to insure your new-to-you ride, parking, and maintenance costs. Our car insurance hub provides tips to help you find the right insurance coverage, while our used car rankings and reviews include information on the cost of ownership for different vehicles.

You’ll want to find a balance between the cost to buy and the cost to own. When you buy an older vehicle, you can expect a lower price. However, the older the car, the more likely it will need costly repairs. That awesome deal you got on a cheap car won’t seem that great when you’re waiting for a tow truck instead of heading to work, school or that weekend getaway.

Fortunately, used-car buyers have more resources today than ever to learn about repair costs, frequent problems and reliability. Information about certified pre-owned warranty coverage, average costs for common repairs and predicted reliability ratings can be found in our used car reviews . You can see what issues drivers are dealing with by checking out dedicated owners' websites, such as Odyclub.com for the Honda Odyssey minivan. If owners of a particular car are having problems, they're probably talking about them somewhere on the internet. Just search for the car's name and "problems" in any search engine to get an idea of common issues.

An oft-overlooked factor you should consider when shopping for a used car is the cost of auto insurance. Prices can vary substantially based on the model you choose. Our guide to car insurance is the place to find the cheapest insurance with the right coverage for your new-to-you vehicle.

2. Find the Right Used Car

Shopping for and finding the right used car is more challenging than finding and buying a new car. When you find a new car that meets your needs and budget, you just have to head to the dealership and buy it. When you buy used, you not only have to find the right model – you have to find one that’s for sale, has low enough mileage to be attractive, is in good shape, hasn’t been crashed, and has been serviced properly. Oh, and you'll want it to be close by. Then, you have to evaluate the seller, ensuring that it’s not someone who’s going to rip you off.

In short, there’s a lot more research involved in evaluating a three-year-old pre-owned car with 36,000 miles on the odometer than there is for a brand-new car sitting on a dealer’s lot.

An excellent place to start your pre-owned vehicle buying journey is with our used-car rankings . We begin by looking at the consensus opinions of the country’s top automotive journalists. Then we blend them with quantifiable information on safety, reliability and total cost of ownership to create scores for nearly every vehicle in the marketplace dating back over a decade. We use those scores to compare vehicles against competitors in their segments to determine how they rank.

With our used car rankings, shoppers can compare pre-owned vehicles by their overall scores and individual factors car buyers tell us are critical to their buying decisions. These factors include predicted reliability, safety, performance, and interior comfort and features.

Selecting a used car to focus your efforts on can be challenging. Should you pick an older car that’s loaded with options or a newer car that has lower mileage but fewer features for a similar price? It’s critical you look at the places you drive, how many people you need to transport, why you’re driving and how you drive. Then match those needs with your budget. Don’t buy that pre-owned Mazda Miata , for example, if you need to carry kids to soccer practice every day. If you’re a solo commuter in an urban area, buying a Chevrolet Silverado full-size pickup probably isn’t the best choice, either.

It’s important to consider not only the size and performance of vehicles you’re considering, but also their fuel economy, safety ratings, and cost to insure. Today, you also need to think about what powers your pre-owned car, with more and more electric cars entering the used car marketplace.

When you buy a pre-owned car, you can get options and features at a fraction of the price they'll cost you on a new car. Option packages and higher trim levels don't command nearly the same premiums on used vehicles as they do on brand-new cars.

As you begin to narrow your search, you can browse through more than a million vehicles in our used car listings . There’s no need to start driving to car lots all over town.

3. Consider the Certified Pre-Owned Car Option

Not sure if you want to take the leap into a used car with no warranty coverage? There is a used car option that does have factory warranty coverage . Certified pre-owned cars (CPO cars) offer a blend of used-car affordability with manufacturer-backed warranty coverage. They're usually low-mileage cars that are just a few years old, with service records and no history of accidents. CPO models are often cars returned at the end of leases, dealership service loaner vehicles or vehicles driven by dealer or automaker staff.

They’re different from non-certified used cars in several ways. When they arrive at the dealership, they undergo a comprehensive inspection and refurbishment process that meets strict guidelines from their original manufacturer. Most used cars are sold as-is, with no warranty. CPO cars, on the other hand, come with manufacturer’s warranties that extend the length of the car’s original coverage. Many CPO programs also provide buyers with extras, such as trip interruption coverage and roadside assistance.

Each year, we evaluate manufacturer CPO warranty programs to find the best CPO programs . The best programs not only provide great coverage for your car, but also include generous perks.

Another benefit of automaker-sanctioned CPO programs is access to special used-car financing deals . Used car loans typically cost more than new car financing, but a CPO financing deal with a low interest rate can dramatically cut the cost you have to pay on your auto loan.

You’ll only find a brand’s certified used cars at their own franchised dealerships. If you see a Lexus marked as a certified used car on a Dodge dealer’s lot, you’ll know it’s not truly part of Lexus’s L/Certified CPO program. Some dealers will label cars “certified,” but unless a vehicle is inspected and refurbished to the original manufacturer’s standards by one of their own dealers, it is not manufacturer certified. Only manufacturer-certified pre-owned vehicles will come with warranty coverage that allows for repairs to be performed at any of their dealerships. A dealership can offer a warranty on any used car, but it's likely much more limited than a manufacturer's CPO warranty.

Of course, the warranty coverage and other perks come at a price. CPO cars are typically more expensive than equivalent non-certified used vehicles. However, a CPO car may have a lower total cost of ownership – at least during the warranty period. You'll need to balance the higher initial cost with the potential for savings in mechanical repairs. One way to do so is by looking at the predicted reliability marks in our used-car reviews . If a car has a stellar score, buying it as a certified used car might not give you the same payoff as a CPO car with a lower predicted reliability score and a future of expensive repairs.

4. Find Affordable Used Car Financing

If you're sitting on a pile of money and plan to pay cash, you can skip this section. However, If you're like most used car buyers, you'll need a loan to help pay for your used vehicle. It's true that you can have the dealership's finance office arrange your financing. If you want to save money, though, you need to get a pre-approved financing offer in place before you get anywhere near a car dealership. A dealer may be able to beat your pre-approved loan, but if you don't have one, they'll have no incentive to do so.

If you're buying from a private party, you have no choice but to find your own financing. The process can be different for private-party buyers, so be sure to talk to your lender early on in the process about what they'll need to move your loan application forward.

Shopping and applying for used-car financing is similar to getting a loan for a new car , but there are some important differences. Because lenders consider used-car loans riskier than new car loans, you should expect to pay a higher interest rate. Lenders typically consider used-car loans to have more risk for several reasons, including the fact that used vehicle values are less predictable. It's the car's value that acts as collateral on the loan. Used-car buyers also may face higher repair costs, which can compete with making timely car payments.

Two people sitting at a table in a car dealership

If the car you choose is relatively new or a certified used car , however, there’s a good chance you can find a lender who will give you the same loan terms they would a new-car buyer.

Getting a great deal on used car financing can take some preparation and work. Following these steps will help ensure you’re getting the best deal.

Preparation

Getting all of your financing plans in place well before your car shopping starts is the best way to be prepared when the right car comes along. That means before you think about heading to a dealership or meeting with private-party sellers. Step one in the financing process is looking at your credit score and exploring the credit reports behind your credit rating.

One of the primary criteria that lenders consider, your credit score will determine whether you get approved for a loan and what interest rate you’re offered. Shoppers with a low credit score can expect to pay a higher interest rate on their auto loan than buyers with higher credit scores. Buyers with bruised credit may also be asked to make a larger down payment or accept a shorter loan term than someone with a great credit score. If you have excellent credit, you can expect a lower-than-average interest rate, access to longer-term auto loans, and lower down-payment requirements. Most used car deals with special financing are reserved for buyers with top-notch credit.

When you are proactive and look at your credit score early, you’ll have the opportunity to correct any errors. You can also take time to improve on any weak areas in your credit history. Your credit score's most important elements are your history of making on-time payments and the amount of debt you have outstanding.

Where to Shop for a Loan

You might think you have to go to a brick-and-mortar bank branch to get a car loan, but there are many places you can finance a used car. Some work better with different types of borrowers than others, so you should talk to several before you decide which financing deal is best for you. Some lenders have programs that provide lower rates or other benefits to existing customers, while others cater to borrowers with damaged credit. You can save money and hassle by taking advantage of these programs.

Large National Banks

America’s biggest banks have thousands of brick-and-mortar branches, plus sophisticated online portals to serve loan applicants and borrowers. They occasionally offer loan specials, though overall the interest rates they offer tend to be higher than other lenders. Because of their size, they tend to be ruled by strict policies and procedures, which may not serve customers with bruised credit or other borrowing challenges well.

If you’re looking for convenience and you’re willing to pay a higher price to get it, large banks are a good option.

Credit Unions

Credit unions are member-owned cooperatives rather than shareholder-owned companies like most other lenders. Instead of paying shareholder dividends, they return any profits to their members through higher savings-interest rates and lower interest rates on loans. They tend to be more affordable places to get an auto loan than most other financial institutions.

Before you can get a loan at a credit union , you have to become a member. Because credit unions have fields of membership that are limited to geographic areas, affinity groups, or specific employers, not everyone can join any credit union. Still, most Americans have access to at least one credit union. The industry’s federal regulator, the National Credit Union Administration, can match you up with one you’re eligible to join. Simply use their credit union locator at MyCreditUnion.gov .

Credit unions range in size from tiny, one-person operations to massive operations with dozens of branches and services that rival large national banks. If you need a bit of hand-holding to get through the loan process or have a poor credit score, a smaller credit union is a good option. They’ll likely have a more personal touch than a larger lender.

Community Banks

Community banks offer many of the same automotive lending services as large banks, but they do so with a smaller geographic footprint, fewer branches, and often a more personal touch. Like credit unions, community banks are great places for borrowers who need a bit more help to finance their used car purchase successfully. With their roots in the communities they serve, many will be able to offer tips about other businesses in the area that can help you through the car-buying process.

Online Banks

During the coronavirus pandemic, getting a used-car loan from an online lender became an attractive option. Even with the pandemic on the wain, they're still a great option for shoppers who need a simple car loan and but not much hand-holding.

While most banks and credit unions have online lending operations, online banks lend exclusively through their websites, with few – if any – branches. If your loan needs are straightforward and you don't need any extra help, the streamlined processes of online banks can make borrowing easy and remarkably quick.

Because they don’t have to pay for expensive brick-and-mortar branches, many online banks offer excellent loan rates. Of course, you shouldn’t assume any rate they offer is the best you can get. You should always comparison shop.

Loan Comparison Websites

One of the easiest ways to get a great deal on a car loan with a minimum of effort is to use a car loan comparison website. After you fill out just one application, the site will contact multiple lenders and return various financing offers. The lender might be a credit union or bank across town, or a financing company across the country. It doesn't matter where the lender is, as loan funding and collection of car payments can be done entirely electronically.

Finance Companies

A finance company is similar to a bank, except that their only business is lending. Instead of accepting deposits and then lending that money back out, finance companies borrow from other financial institutions, then make loans to consumers using that borrowed cash. Many finance companies specialize in making loans to certain types of borrowers, such as those with poor credit.

Most automakers own finance companies, such as Ford Motor Credit or Honda Financial Services, or work with specific lenders, such as Mitsubishi and lending partner Santander. Called captive finance companies, these lenders work through their brand's franchised dealership network. They also provide the lending for automakers’ new-car financing deals , lease deals and certified used-car financing offers .

Car Dealerships

While you can arrange for a car loan through a car dealership , most dealers aren't actually doing the lending. They're acting as a broker, arranging loans with outside lenders, such as their captive financing companies, local banks or credit unions. In most cases, they make a significant profit by marking up the interest rate they charge or being otherwise compensated by the lender. In most states, there is no requirement to disclose the amount of markup they’re charging on a loan.

While a loan offer you receive at a car dealership may be the best one you get, it is critical you never visit a dealership without at least one offer already approved by an outside lender. Without another offer, a dealer’s finance officer will have no incentive to offer you a better deal and earn your business.

There’s a class of car dealerships called "buy here, pay here" dealerships . We’ll talk about them more later in this guide, but they differ from traditional dealerships in that they do loan their own money and directly collect payments on the loans they make. Consumer advocates advise against getting loans from this type of dealership due to the predatory lending practices of some buy here, pay here dealers.

Applying for Used Car Financing

The next step in getting an auto loan is applying for financing. Auto lenders will ask you to fill out and sign either an online or paper application. You'll need to provide personal information about your income, monthly obligations, housing expenses, work history, credit card debt and more. You'll also be asked to provide your social security number so the lender can pull credit reports. You must answer the questions completely and honestly. Failure to do so risks your loan being turned down. If it's discovered after you take out the loan, the lender may declare the loan in default and demand immediate repayment.

The information on the application is evaluated alongside the data in your credit report. The lender is trying to build a complete picture of your finances, so they can predict whether you'll be able to pay back the loan. The law limits what information they can use to make a loan decision. However, they may ask for some demographic information for government reporting purposes.

Just as smart buyers should talk to multiple car dealerships and other sellers before buying a used car, you should apply at multiple lenders to find the best financing deal. It's critical to do so during a short span of time, so the credit reporting agencies don't think you're taking out multiple loans and ding your credit score over and over. Do your shopping over a week or so, and they'll just see it as one transaction. That's important, because each transaction that pulls a credit report lowers your credit score by a few points.

When you apply for a car loan before choosing a specific vehicle, the approval will likely be conditional, with a limit on the amount they will loan to you. With multiple offers, you can compare the interest rate they're willing to give you, how long of a loan they're extending and the size of the down payment they require you to make. You can then choose the best offer once you've negotiated the price of the pre-owned car you want.

Comparing Loan Offers

While it is vital to have a monthly payment that fits into your household budget, you need to look beyond the payment when comparing loan offers. Instead of just looking at what you'll pay each month, you want to look at the total cost of the car, including its financing. Fortunately, it's easy to do. Just multiply the monthly payment by the number of months in the loan term, then add the amount of any down payment you're making and the value of your trade-in, if you have one.

The monthly payment should be included with the financing offer. If it’s not, head over to the U.S. News car loan calculator . Enter the interest rate, loan amount, and length of the loan into the form, and it will show you the size of each monthly payment.

Here’s an example. We’ll say you’re buying a used midsize SUV and have received a pre-approval for a five-year (60-month) loan with monthly payments of $350. You've saved up $5,000 for your down payment and your trade-in is worth $3,000. To find the SUV's total cost, you multiply $350 by 60 months, then add $5,000 and $3,000 to that amount. The total cost of buying the used SUV would be $29,000.

It's important to run the numbers yourself and not to rely on the math of a salesperson. They're trained to keep you focused on the payment, because they know that's the easiest way to get you to overpay for your used car.

The Importance of a Down Payment

Many lenders will allow you to buy a used car without making a down payment, but that’s seldom a great idea. Making a down payment will help you in several ways, all while helping to protect your finances. The benefits include lowering your monthly payments, allowing you to get a shorter loan, or both. It will also reduce your loan-to-value (LTV) ratio, making your loan more attractive to lenders, who may offer you a lower interest rate.

Making a substantial down payment also makes it less likely that you’ll owe more on the car than its value, which is known as being “underwater” on the loan or having negative equity. Being underwater is hazardous to your financial health. If the vehicle is declared a total loss after a crash, theft, or flood, the amount you get from your auto insurance company won't be enough to cover the loan. You will still owe the difference to your lender. They can demand immediate repayment since the loan's collateral (your car) no longer has any value.

Short Loans Are Better Than Long Loans

A lender may offer you a six-, seven-, or even eight-year auto loan. It's a horrible idea to take out such an extended loan on a used car – or any car, for that matter. You should consider five years to be the maximum length of any auto loan you take. Consumer advocates recommend that if you can’t afford a car with a five-year or shorter car loan, you simply can’t afford the car.

Here’s why: longer-term loans are considered riskier to lenders than short loans. Lenders will price that additional risk into the financing with higher interest rates. Not only will you have to pay a higher interest rate, but you'll have to pay it for a longer time. That makes the total cost of the car significantly more expensive. The longer your loan, the higher chance you'll still be making car payments at the same time as your vehicle begins to need more and more costly maintenance and repairs.

The rate at which your car will depreciate doesn’t change based on the length of your loan. The longer your auto loan, the higher the chance of owing more on the car than it is worth. As we discussed in the previous section, being underwater on your financing puts you in financial peril.

Finally, suppose you still owe money on your car when it needs replacement, or you want a new vehicle. In that case, you'll either have to pay it off with cash out of your own pocket, or roll the remaining balance onto your new car loan. While lenders add the balance of existing car loans to new loans all the time, it’s one of the worst car-buying mistakes you can make. It puts you instantly underwater on your car’s financing.

5. Decide Where to Buy a Used Car

Just as there are many places to get used-car financing, there are various places where you can purchase a used car. Each has its strengths and weaknesses in terms of service, ease and price. Like the car you want to buy, you should strive to learn as much as you can about the dealership or private seller trying to sell it to you. Checking the company out with your local Better Business Bureau or consumer protection agency is an easy way to find out about their track record. You don't just want to look at the number of complaints, but how they responded to correct the problems.

Franchised New Car Dealers

You’ll generally pay more for a used car at a franchised new car dealer, but it may be worth it for the seamless buying process. Though you'll have to contribute to the dealer’s overhead, the salesperson’s commission and other administrative costs by paying a higher price, they'll take care of all of the paperwork for the deal. That's especially helpful if the transaction is complex or you're buying in a different state than the car will be registered.

Dealers have access to a wide variety of lenders, so there’s a chance they can get you a better loan offer than the one you have pre-approved. They are also the only place where you will find factory-certified pre-owned vehicles.

During the COVID-19 pandemic, many dealerships developed robust online sales processes, many with home-delivery options. In fact, you may never have to visit the dealership during the entire sales and delivery process.

Used Car Superstores

When it comes to used-car dealerships, national or regional used car superstores are the new kids on the block. They offer many of the same advantages of franchised new-car dealerships, such as expertise in handling paperwork, step-by-step buying processes and access to an array of lenders. Many sell their own line of add-on products, such as extended warranties valid at any of their locations.

They also have access to a vast selection of used cars. With most dealerships, you're limited to the pre-owned vehicles they have on their lots. That's not the case with used car superstores such as CarMax, which can draw on inventories from across the country and bring those vehicles to your local outlet.

Some used-car superstores have been at the forefront of providing online and socially distanced car buying experiences during the coronavirus pandemic. Carvana’s sales process, for example, brings cars right to your door. You have seven days to decide if you like the car. If not, they’ll take it back.

While you may not get the best price at a used car superstore, you’ll have the sense of security that comes from dealing with a large, established business.

Independent Used Car Dealers

Independent used-car dealerships are typically small, locally owned businesses. They buy and sell used vehicles, arrange financing and take care of the purchase paperwork. Their inventory typically comes from wholesale auto auctions. Most don't have service departments and thus have less total overhead than a typical new car dealer.

While we’ve all seen the stereotypes of used car dealers, most have been around for a long time earning good reputations with customers. Still, it’s a good idea to check with your local Better Business Bureau or other consumer advocacy group to learn more about the business. Sites like Yelp.com tend to be where customers just complain, but they can illuminate consistent issues with companies.

‘Buy Here, Pay Here’ Dealers

There’s one type of used car dealers that buyers should approach with caution. “Buy here, pay here” used car dealers act as both the car seller and lender. The name comes from the fact that many require buyers to bring their car payments directly to the dealers – sometimes every week.

"Buy here, pay here" used car dealers typically are the lender of last resort for buyers with terrible credit. Unfortunately, they charge extremely high interest rates and can do more damage to your credit than they can help it. Many make more money off financing the car than selling it. Some have aggressive collection practices and will repossess your vehicle if you're even a day late. It's not uncommon for “buy here, pay here” dealers to install tracking devices and systems that disable the car to make repossession easier.

Because of their reputation for taking advantage of the most vulnerable buyers, most consumer advocates advise against buying a car or financing at a "buy here, pay here" dealer. While it may be a bitter pill to swallow, if your credit is so poor that this type of dealer is your only option, you should not be buying a car. Doing so only invites further financial troubles.

Private-Party Sellers

When you buy a car from a person or company that's not in the business of selling cars, it's known as a private-party purchase. It can be the cheapest way to buy a used car because you don't have to pay for a dealership's overhead or profit. A private-party sale generally provides the seller with the best return and the buyer with a lower price than they would find at a dealership.

Buying a Used Car

The trade-off is additional work for both the buyer and the seller. Between the two, all of the sales, title, registration, and other DMV paperwork needs to be completed. In nearly every case, a private-party car sale will be an as-is transaction. The buyer has no recourse if something goes wrong with the car, even a moment after they hand over payment.

Because private-party sales are mostly unregulated, you don't enjoy the same consumer protection laws you have at licensed car dealerships. You'll need to be a skilled negotiator to overcome the emotional attachment a private seller will have for their old car.

Buyers need to be wary of unlicensed car dealers disguised as private-party sellers. They’re called “curbstoners." They may have several vehicles available at once, won't know the real history of the cars they're selling, and may be just a little too familiar with the car sales process. One easy way to identify an illegal car dealer is to search for their phone number or email address using Google or another search engine. If the search results show multiple vehicles for sale, you may have found an illegal dealer. If you do turn up multiple vehicles seemingly from one seller, look at the backgrounds of the photos. If they’re all the same, the seller may be a curbstoner. If the seller answers the phone and asks “Which car are you calling about?” there’s a good chance you’ve found an illegal dealer.

6. Finding a Used Car

Searching for a pre-owned vehicle used to mean scouring tiny newspaper classified ads, cruising shopping center parking lots searching for cars with “For Sale” signs in their windows and visiting car lot after car lot. Fortunately, things have changed.

Today, you can find nearly every used car that's for sale somewhere on the internet. Our used car listings , for example, show almost a million vehicles available at dealerships across America. You can narrow the search to your area and the specific model of car you’re looking for.

Craigslist is a common place to find vehicles for sale by private sellers, but it's not the only place. Facebook Marketplace, eBay Motors and even Nextdoor.com can show you private-party cars for sale in your area. If you’re looking for something a bit more exotic, head over to BringATrailer.com .

7. Research, Test Drive, and Inspect a Used Car

OK, now the real fun starts. When you've identified a vehicle you might want to buy and secured a pre-approved financing offer, it's time to delve deeper into the car's history. You want to find out as much as you can about any vehicle you're considering. That means getting a vehicle history report, taking a test drive and having it inspected by an independent mechanic to ensure that it's mechanically sound.

Get a Vehicle History Report

The first step in evaluating a used car is getting a vehicle history report. You don’t want to travel all over town looking at cars that aren’t worthy of your attention. A vehicle history report from a company such as Carfax or Autocheck can tell you if a car is worth pursuing or if there are too many red flags to keep it on your list.

You will need to get the car’s vehicle identification number (VIN) or license plate number from the seller before you can run the report. You can often get the license plate number from ad photos.

Many dealers will provide the reports for free. If you order them yourself, you can expect to pay about $25 for one report, or less if you buy a multireport package. If you’re looking at multiple cars, the multireport packages can save you money.

What’s in a vehicle history report? Though they’re not perfect, a vehicle history report can tell you whether a car is worth spending your time looking at or whether it’s time to move on to your next candidate.

Collisions: While it may not show very recent collisions, a vehicle history will include information about major reported accidents a car has been in. It uses data from state DMVs, insurance companies, police agencies and other sources. In some cases, information as detailed as airbag deployment and structural damage will be noted.

Seeing a collision listed on a vehicle history report should not instantly knock the vehicle off your shopping list. When you do see an accident in a car's history, it's something that you'll want the mechanic who does your pre-purchase inspection to know about. That way, they can look for additional damage and evaluate the quality of repairs. Knowing that a car has been in an accident gives you leverage for a significant price concession on the seller's part during price negotiation.

Flood, Fire, or Other Damage: A vehicle history report will also indicate other damage, such as water damage from a flood, fire damage or damage from a hailstorm. The first two should disqualify a vehicle from your consideration due to the high potential of hidden damage.

The report should note if a car has been stolen and recovered. If it has, you'll want to see when it was stolen and when it was recovered. If a long time has passed between the two dates, you'll want to take the car off your consideration. It's a red flag that indicates the vehicle was abandoned and later found.

Title Status: Information about a car’s title can give you more insight into its history than any other single item on a Carfax or Autocheck vehicle history report. If you see a "branded" title or one that has been moved from state to state to state, it's a huge red flag, and you should probably wipe the car off your shopping list. Common title brands include salvage, junk or rebuilt for vehicles declared a total loss by an insurance company. Others include police use, taxi use, hail damage, flood damage and lemon law buyback. If you decide to purchase a vehicle with a branded title, you should demand a massive price reduction and let your pre-purchase inspection mechanic know about its history.

You should be wary of cars that have been moved around the country. Unscrupulous sellers use that as a method of "washing" negative information off the title. Various states title vehicles differently, and some sellers take advantage of the variations.

Ownership: Sellers love to advertise cars as “one-owner” because they’re more valuable than those owned by multiple owners. The vehicle history report will show you whether that’s true in its ownership history section.

Also in the ownership section, you’ll be able to see if there are any liens on the vehicle. You don’t want to buy a car until you have documented proof that the liens have been satisfied and removed.

Odometer Readings: Most states require the car's mileage to be recorded when you renew your car’s registration or get a state-mandated inspection. Those numbers are shown in a vehicle history report and should match what you see on the car's odometer. If the car's odometer shows a lower mileage than in the report, you should ask the seller for a documented explanation or walk away from the deal.

Maintenance and Service History: A car that a seller can show was properly maintained is worth more than one without any service records. You can get a sense of its maintenance history with the information included in a vehicle history report. You'll also want to get copies of the vehicle's service history from the seller and have the mechanic who does your pre-purchase inspection assess the quality of the work.

Sales Information: The sales information section of a vehicle history report will show when the vehicle first entered service and how many times its ownership has been transferred. Watch for vehicles that have been moved repeatedly from state to state, or from an area that has recently endured floods, fires, hurricanes or other natural disasters. Not only is moving a car one way to mask title issues, but it can also be used to hide flood damage.

Registration and Inspection Information: The report should show every time a vehicle is inspected or registered in a new state. Again, be wary of cars that are moved around a lot. Gaps in a car's registration history can indicate vehicles that were stolen and took a long time to recover, took a long time to rebuild following an accident, or were abandoned and later put back into service.

Recalls: While a vehicle history report should show any open government-mandated recalls, there’s a better place to find the information. Just enter the car’s VIN into the National Highway Traffic Safety Administration’s Safety Issues and Recalls page . It’s OK to buy a car with open recalls, as long as either the seller gets them taken care of before you take delivery or you do as soon as you get the car.

What Won’t You Find in a Vehicle History Report? While vehicle history reports are valuable, there’s information that they don’t include. Recent crashes and repairs performed at shops that don’t report them may be absent from the report. The reports also don't usually show the names of a vehicle’s previous owners, as state privacy laws typically protect that information. A vehicle history report is not a replacement for a detailed pre-purchase inspection by an independent mechanic.

First Impressions

When the time comes to start looking at used cars in person, your first impression of both the vehicle and the seller should tell you if you should move the process forward or walk away. If you're looking at a car from a private seller, it's a good idea to treat it like a blind date and meet somewhere public away from your home and theirs. You want to look at cars in the daylight, as the dim light of evenings can prevent you from spotting damage.

Evaluating a used car means using all of your senses (except maybe taste, because that would be gross). It should also include your sense of intuition, which will help you determine if something doesn't seem right.

It’s a good idea to show up a little early so you can see the car pull up. Do you hear strange noises or see smoke behind it? Do a walk-around looking for damage, worn or non-matching tires, and broken glass or lights. If there’s something that stands out and would make you pass on the car, it’s a good time to tell the seller and leave. This way, you don’t waste any more of your time or your or theirs.

Next, look at the car’s body and paint. Is it in good shape? Does the color and gloss match from panel to panel? Mismatched panels are an obvious sign of repaired collision damage. Ask the owner to turn on all of the lights and look to see if they’re burned out, cracked, or full of water. A light that’s not working can be as simple as a burned-out bulb or as costly as a bad wiring harness. Keep track of anything that gets your attention so you can tell your pre-purchase inspection mechanic to check it out.

Start exploring the car's interior, looking at the upholstery's condition, and noting any bad smells. A moldy smell can indicate flood damage, while the smell of cigarette smoke can be tough to remove. How clean is the car? If it's filthy, how sure can you be that they've adequately maintained the rest of the car?

While it's not a good idea to bring your kids along when looking at cars, it is a great idea to bring along their car seats. Not all child seats fit well in every car, and you'll want to know if yours do. The same goes for dog crates and other items you frequently carry.

Learning From a Test Drive

Taking a test drive is one of the most critical tasks in buying a used car. However, the rules have changed due to the coronavirus pandemic. It's OK to place your personal safety above all else. You should insist on taking your test drive solo. If the seller refuses, negotiate a compromise that makes you both feel as safe as possible.

A thorough test drive takes more effort than simply driving around the block. It's more than just a way to check the car's condition; it's also a chance to see how it meets your needs and whether you can get comfortable in the driver's seat.

Before You Move

A proper test drive starts well before you start moving. You want to get comfortable in the vehicle by adjusting the seats, steering wheel, and mirrors. Ensure you can reach all of the controls and see what you need to see from the driver's seat. If you can't get comfortable on your test drive, the car isn't going to magically become more accommodating after you buy it.

Next, start the car and try out every system. Did the car start quickly, or did it crank for a long time? Even if it's freezing outside, try out the air conditioning and check every fan speed. The same goes for the heater, even if it's the hottest day of the year. Switch on the vehicle's interior lights. If they're pulsing, it can indicate an issue with the car's electrical system. Check every door lock and window, listening for odd noises as they raise and lower.

Turn on the stereo and move the fader and balance so you can hear each speaker, making sure none of them crackle.

If you see anything that leads you to think that the car is unsafe to drive, do not take a test drive. That includes burned-out brake lights, a broken windshield, an airbag warning light, or tires worn to the cords. As the driver of the car, you're ultimately responsible for any damage, injuries or traffic citations that occur while you're on the test drive.

Make note of any issues you find. The seller will either need to get them fixed or offer price concessions so you can make the repairs after you buy the vehicle. Of course, if you’re buying a very old car or one with high mileage, you can’t expect perfection. You should always expect the vehicle to be safe, though, or be prepared to spend the money to make it safe.

A test drive is an opportunity to learn about a vehicle you may buy, assess its condition, and get a sense of its performance. It is not a chance to allow your inner Formula One driver to run free. Most car dealers will immediately stop the test drive when this happens and ask you to take your business elsewhere. Do it in a private seller’s car, and you’ll likely be held financially responsible for the damage you cause.

When you start moving, you’ll want to turn off the car’s radio so you can hear any strange engine, transmission or suspension sounds. You’ll also want to listen for wind noises around the windows, doors and sunroof that may indicate leaks.

Is the ride as you expect it to be, without strange jolts or noises? Be sure to adjust your expectations to the type of car you’re driving. An off-road-oriented pickup can’t be expected to provide the composed ride of a midsize sedan, for example. If you’re buying from a dealer, they will likely have preset test drive routes. If possible, however, you’ll want to test drive the car on the types of roads more typical to your commute. That’s another reason to push for a solo test drive.

You should pull into a parking lot so you can assess the car’s maneuverability and how easy it is to see outside or use the vehicle’s cameras when in tight spaces.

While it’s natural to be nervous when driving someone else’s car, do your best to drive it as you would drive your own. Test the brakes, making sure they don’t pulse or grab. Does the car accelerate smoothly, or does the transmission slip or cause the vehicle to lurch? Does the car drift left or right when you hold the steering wheel straight? A very slight drift to the right is acceptable, but it should never pull to the left, into oncoming traffic. Vibrations you feel in the steering wheel typically come from the front tires, suspension, or brakes. Those you feel in the seat of your pants likely come from the rear of the car.

Pay attention to the instrument panel. Are warning lights coming on? Or are lights not coming on when they should?

While you should note every flaw during the drive, not all should eliminate the car from consideration. Some issues can be used as bargaining chips when negotiating a price. All issues should be brought to the attention of your pre-purchase inspection mechanic.

We have a whole feature article dedicated to the topic of How to Test Drive a Car .

Get an Independent Mechanical Inspection

A great test drive may have you ready to write a check and drive the car home right away. However, there's another critical step you have to complete before you decide to buy. With just one exception, you should not buy a used car without a comprehensive pre-purchase inspection by an independent mechanic. The only exception would be if you're buying a relatively new certified used car with factory warranty coverage from a franchised new-car dealership.

When we say independent mechanic, we mean one that works for you, not the seller. Taking it back into a dealership’s shop, putting it up on a lift, and declaring it in good order simply isn’t good enough.

Yes, a pre-purchase mechanical inspection will cost you some money – probably $100-$200. However, if it saves you from a major mechanical repair soon after your purchase, it will have been worth it. Plus, it may highlight issues that give you additional bargaining power in your price negotiations. In some states, AAA-affiliated auto clubs offer comprehensive pre-purchase inspections from AAA-approved auto shops or mobile inspection companies.

Sometimes a seller will resist your need to have the vehicle inspected. Sometimes they don’t think it’s worth the hassle, while other times they’re trying to conceal known problems with the vehicle. No matter what the excuse, you want to be firm: No inspection, no sale.

Good mechanics will not only find issues that aren't apparent to most car shoppers; they'll also be able to estimate how much the repairs would cost. Their experience should tell them what problems are common to specific models and identify when collision repairs and periodic maintenance have been performed correctly. They will have access to databases that identify common issues so that they can focus their attention on those areas.

If a mechanic finds issues, it doesn’t necessarily kill the deal. Any problems they find just become another point to address in your price negotiations.

8. Make a Deal and Complete the Paperwork

If the test drive and independent mechanical inspection don't raise any concerns, it's time to negotiate a deal, set the purchase price, and finalize the sale and paperwork.

Negotiating a Fair Price

Price negotiation is part art, part science. It is critical to remember that it’s not personal. Buying a car is a business transaction – nothing more, nothing less. The more you show your emotions, the less powerful your bargaining position. Negotiation needs to be based on facts, not your feelings.

In the past, most price negotiation would have been done face-to-face. Today, it’s just as likely to be done by chat, text or email. That’s great for buyers, who then have a written record of the offers that a seller can't conveniently forget happened. You can take those messages and use them as leverage with the sellers of other used cars.

You’ll want to research what others are paying for similar cars in the marketplace. Our used car reviews show market price information for used vehicles going back more than a decade. Look at what price private sellers are seeking on Craigslist and Facebook Marketplace, but remember those are asking prices and not what the vehicles are actually selling for.

What strategies you use depends on where you're buying the car. If you're buying from a dealership, you'll be negotiating with a salesperson who is trained to move you incrementally to the deal they want to give you. Dealer salespeople will generally want your focus to remain on the monthly payment, while you'll want to keep them focused on the total cost of the car. If you have a trade-in or need financing, they’ll want to package everything into one deal, while you want to keep them as separate as possible.

Here's why: By merging all of the numbers into one deal, a trained salesperson can manipulate each of the components to make it look like you’re getting a deal when you really aren’t. It also breeds confusion, which is advantageous to the seller. You can take the trade-in completely out of the deal by selling it yourself . Having a pre-approved financing deal in place limits their ability to manipulate a loan’s terms.

Setting a price with a private seller is usually much more casual. In fact, if a seller starts acting too much like a salesperson, it's a red flag that you might be talking to an unlicensed dealer. Private-party car sellers often have an inflated opinion of their car's worth and are emotionally attached. Sometimes they have an unrealistic price they "need" to get out of the vehicle.

Negotiation experts will tell you that the person who talks first about price, or talks the most, will usually not get what they want out of the back and forth. Ask the seller what price they want for the vehicle. Doing so locks them into a price that they can’t ever take higher.

Be sure you’re talking about the out-the-door price, including all fees. Many dealers are notorious for adding a plethora of fees to the negotiated price. Some are real and non-negotiable, such as registration and title fees. Others are more nefarious, such as documentation, advertising, and vehicle preparation fees. Those last few should be part of the negotiation and considered part of the price of the car.

Some used-car sellers, such as Carvana, are simplifying the car-buying experience by eliminating last-minute fees and pivoting to a no-haggle sales process. The car's advertised price is not negotiable, and no dealer or documentation fees are added to the purchase price.

Your counteroffer should be at the low end of what similar vehicles are selling for, and you should be ready to back up your offer with reasons why. Be sure to consider the cost of any repairs the car needs in the amount you offer.

Remember: once you throw out a price, you can never go lower. If your counteroffer is so low that it's insulting, remember it's the seller's right to send you on your way. It's important to consider that a dealer is entitled to get a fair price for the sale. A private-party seller will expect a price in the range of what other sellers of the same car are getting.

Bottom line: Don’t be a jerk, and don’t let the seller be a jerk to you. Be firm, yet polite and professional.

Negotiation can take some time. Each time the seller comes back with an offer, make them back it up with reasons why they think it’s worth that price. Counter their offer, and back it up with reasons why you won’t pay their asking price.

If a seller tries to bully or intimidate you into making a deal, you should run – not walk – away. In fact, walking away is the most powerful negotiating tool you have, as long as you use it the right way. If you walk away, be sure to leave your contact information, letting them know to contact you if they can come closer to your price.

Never trust a seller’s math when it comes to evaluating an offer. Have a notepad at the ready, and pull up the calculator app on your phone to run the numbers. Once they realize that you understand how all of the numbers fit together, they’re less likely to play games with the figures.

Signing the Papers

If you’re buying a car from a dealership, this last step is easy. The salesperson will have the purchase documents prepared. You just have to read and sign them. Be sure to check all of the numbers and make sure no costly extras have worked their way into the deal. Never sign documents that are incomplete or incorrect. It's harder to demand the correction of paperwork that already has your signature on the dotted line.

It's more complicated when you buy a car in a private-party sale. One of you will have to create a bill of sale. It should note the date, mileage, price, and any special terms. Your lender may have a specific form they need you to use or require additional information to be included. In most cases, car sales between individuals are as-is transactions with no warranty coverage. If you negotiated repairs into the deal, they must be specified on the bill of sale.

Different states require different documents for a private-party sale. At the very least, you'll have to reassign the title from the seller to you and register the car in your name. In some states, you'll also have to file an odometer disclosure or have the odometer reading verified. If you're moving the car to an area with safety or emissions testing, you'll need to have that done before registering the vehicle. Some states will require you to have proof of auto insurance coverage and require payment of any taxes when applying for registration.

Since the pandemic and ensuing personnel shortages, the process of registering and titling private-party vehicles has become very difficult and time-consuming in some states. Be sure to check with your local DMV to ensure that you can get all of the paperwork completed in a timely manner.

Beware of ‘Yo-Yo’ Financing

Some car dealers will let you drive a pre-owned car home before the financing paperwork and approvals are complete. You never want to do this. When you accept what is called “spot financing,” you open yourself up to be a victim of the “yo-yo” financing scam.

Here's what happens: It appears the paperwork is all complete, but the financing component isn't quite done. The dealer's finance officer or salesperson will tell you that they just have to file paperwork with the lender in the morning. There may be a line in the fine print that says the financing is pending approval.

After you’ve been enjoying your new-to-you used car for a week or so, you’ll get a call from the dealership saying that you didn’t qualify for the financing in the original paperwork. They’ll demand you return to sign new paperwork. When you arrive, you're faced with a financing deal that's far more expensive than the one you originally agreed to. They'll often apply significant pressure to get you to sign, implying that you have no other choice. Fortunately, in most cases, you do.

It is sometimes true that the dealer believed you would qualify for the financing. In other cases, unethical dealers know that you never had a chance to qualify for the financing deal you thought you were getting. Instead, they want you to take the car home, fall in love with it, and then be coerced into signing for a new, more expensive loan.

If that happens to you, the first call you want to make is to a local bank or credit union to determine what kind of a deal you qualify for and get approved for a new deal. Take that pre-approved loan back to the dealer and use it to buy the car. If you can't qualify for financing from an outside lender, take the vehicle back to the dealer and demand they undo the deal. In some states, the laws regarding spot financing are in the buyer's favor. In some states, however, they favor the dealership and leave you with few options.

You can avoid falling for this unethical practice by financing your used car purchase outside of the dealership and ensuring all of the documents are finalized before you sign. Watch out for phrases such as "conditional approval" or "conditional delivery." Don't sign any papers with those terms.

9. Consider Add-Ons, Warranties and Insurance

We’re almost at the finish line, but there are a couple of final tasks that need to be taken care of.

When you are signing the final paperwork, you’ll likely be barraged with offers for add-on products . They’ll range from various vehicle protection products, such as paint and upholstery sealants, to gap insurance and extended warranties (sometimes called service contracts). The offers will generally come with slick sales pitches and pressure to buy right now.

Before you do, you want to do your research. In many cases, the products can be purchased outside of the dealership at better prices. Products such as extended warranties can be purchased from many lenders and insurance companies. The same goes for gap insurance coverage, which can usually be packaged with the rest of the car insurance coverage you buy from an auto insurance company .

In fact, nearly every product offered in a dealer's financing office is available elsewhere. You'll want to take time to compare what the dealer is offering versus what's available in the marketplace.

It's likely that time pressure will come from the dealer's desire to include the products in your car's financing. "It will only add a few dollars per month to your payment," you'll be told. The truth is, you rarely want to finance these add-ons. They add no little value to your vehicle but raise your financing's loan-to-value (LTV) ratio, potentially putting you underwater. The "just a few dollars per month" argument also hides the real cost of the products.

Buying a manufacturer-certified used car typically gets you factory warranty coverage, eliminating the need to immediately purchase an extended warranty. Other used vehicles are usually sold as-is, with no warranty past the car's original factory warranty. Once that warranty ends, or if it is already finished, you'll be on your own for repair costs. Consumer advocates almost universally advise against purchasing extended warranties. If you decide to anyway, be sure to compare the products available in the marketplace, their prices and the companies behind them.

Purchase the Right Car Insurance

It's often overlooked, but buying car insurance to protect your new car isn't just a good idea; it's the law in nearly every state. Even if it's not, most lenders will require you to have insurance on any car they finance. The coverage that's needed will vary by your state and lender.

The U.S. News guide to car insurance is the place to go when you want to learn how to navigate the world of auto insurance. We’ll help you understand how car insurance works , how much coverage you need , and how to find car insurance discounts .

Owning a Used Car

It has been a long journey, but now you're a car owner. You'll want to ensure that it is properly maintained and that you take steps to protect its value . By taking care of your car, you’ll limit its depreciation. When it's time for your next vehicle, you want its trade-in value to be as high as possible.

You worked hard to get your car and its financing. Not making your car payments can see all of that hard work go to waste, taking your credit score along with it. Our guides explaining what to do if you’re underwater on your car loan and what to do if you can’t make your car payment can take you through the process of dealing with financial calamities without needless damage to your credit.

More Shopping Tools From U.S. News & World Report

A guiding principle we follow at U.S. News & World Report is that you can't get a good deal unless you're getting a good car. That's why we've designed our used car reviews to answer the questions shoppers have when they're in the car-buying market. Our used car rankings and reviews are based on the country's top automotive journalists' consensus opinion, blended with quantifiable information about safety, predicted reliability, cost of ownership and other factors. We don't accept expensive gifts or travel from automakers so that you can be assured of our impartiality.

With the right deal, a new car can be as affordable as a used car. We scour the marketplace to bring you information about the best new-car financing and cash-back deals. You’ll find them on our new-car purchase deals page . Our lease deals page shows special offers with low monthly payments and little due at signing. Shoppers in the market for a certified used car should explore our used car deals page to find special financing offers.

The U.S. News Best Price Program connects new car buyers and lease customers with local dealers offering pre-negotiated pricing, online sales processes, and home delivery options.

Save on your monthly payments! Find the best local prices on your next car.

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Guide for First-Time Car Buyers

What you need to know before buying your first car.

A big step toward feeling like an independent adult is buying your own car. However, it's important to know what you're doing — and what you're buying. There are plenty of cool-looking cars with great features, but which one is right for you? And how will you know that you're getting a good deal?

This buying guide is designed to help you get what you really want out of your first car purchase. From monthly payments and loan terms to used versus new, we'll walk you through all the tough choices and get you ready to make the best decision.

Honda dealership

How Much Can I Afford?

The first part of buying a car is knowing your limits. What's the most you should spend on your monthly car payment? Schools of thought differ on this question, but the Edmunds view is that your car payment should be no more than 10% of your monthly take-home pay if you're buying used, or 15% if you're buying new.

Not sure what that translates to in a car price? Take a look at our affordability calculator for more information.

You'll also need to factor in the cost of insurance and fuel. Insurance costs vary widely depending on driver age, driving record, vehicle type, insurance provider and extent of coverage, so make sure you get quotes from multiple providers based on all those specifics. Fuel economy figures can be found at the EPA's fueleconomy.gov website. Together these two costs should be no more than 7% of your monthly take-home pay.

How Do I Get a Loan?

When it comes time to apply for a loan, you have a few options: your bank or credit union, the dealership or a third-party lender. Dealerships tend to have better rates, but that's not always the case, so it's worth getting preapproved by other lenders before visiting the dealership to give yourself a basis for comparison. Note that if you're shopping for a used car, the lender may expect you to know what vehicle you plan on buying. Also, make sure you get all your loan applications done within a couple of weeks so there is only one big impact on your credit score.

How Long Should My Loan Be?

More and more people are taking out long car loans to make their monthly payments more manageable, but that's not always the best idea. A longer loan will lower your monthly payment, but you will pay more in finance charges and it will take you longer to gain equity in the vehicle. These days, 72- and 84-month loans are increasingly common, but we recommend 60 months or lower — especially if you're financing a used car. 

There are other reasons to keep your loan as short as possible. For example, consider how soon you might get tired of the car. If you go for a 72- or 84-month loan, by the end of it you might be ready to unload your aging ride and jump straight into a new car. But if you choose a 60-month loan, you might enjoy the car for an extra year or two with no car payments. Or go ahead and get rid of it at the five-year mark — the car is fully paid for, and you've saved the equivalent of two years' depreciation versus waiting till the end of a seven-year loan. Check out our article on how long a car loan should be for more information on loan terms.

What About the Down Payment?

In an ideal world, we'd put down 20% on a new car and about 10% on a used car, to offset the initial depreciation. But not everyone can handle that with today's car prices. If you need to make a smaller down payment, our advice is to put down as much as you can without dipping into your emergency savings. If you put down less than 20% on a new car, it may be worth looking into gap insurance . See our detailed analysis of how much a down payment should be to learn more.

Should I Consider Leasing?

If you're into the latest tech and luxury, leasing may be a compelling option. Suppose that a $400 monthly payment is the most you can comfortably afford. If you're buying, that might get you into a mainstream SUV or sedan — but if you're leasing, you can choose from a variety of luxury models. At the end of the day, of course, you don't own the car, but you also get to skip the usual maintenance and repairs, paying only for routine procedures such as changing the oil and tires. There's no objective answer to whether buying or leasing is better, but for those who don't mind always having a car payment, it's easy to see why leasing holds appeal.

See Edmunds pricing data

Has Your Car's Value Changed?

Used car values are constantly changing. Edmunds lets you track your vehicle's value over time so you can decide when to sell or trade in.

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What Car Should I Get?

To answer this question, consider how well the models in your price range meet your needs. How many people can they hold? How do they drive? How's the fuel economy? What safety features do they have? How much cargo can they hold?  Do they offer "must-have" features such as Apple CarPlay, a sunroof or leather seats? Our article on finding the right car for you lays out this approach in more detail. If you already have an idea of what you're looking for, our car rankings and reviews will help you narrow it down.

Test-Drive and Inspect the Car

You've decided on a car. Great! Now it's time to take a closer look. Arrange for a test drive with the dealership or private seller. Pay attention to how the car feels on the road and whether it has enough room for your family or cargo. If the vehicle is used, we recommend getting it inspected by a trusted mechanic before making the deal. This kind of inspection usually costs somewhere between $100 and $200. You can forgo the inspection if the vehicle is a certified pre-owned vehicle since it will come with a limited warranty.

Settle on a Price and Close the Deal

If you're searching for new vehicles on Edmunds, you'll see that we list the suggested price to pay on each inventory listing. If you've already obtained a dealer quote, use Edmunds Price Checker tool to help determine if you're getting a fair price. For used vehicles, Edmunds has a "deal rating" that lets you know how a vehicle is priced relative to its market value. Use this data to help with the negotiation . Once you've agreed to a price, and if the seller is a dealer, you'll want to ask about any other fees or add-ons that haven't yet been disclosed. This means extended warranties, maintenance plans and so forth. Be sure to ask for the " out-the-door " price, which factors in all the taxes and fees and gives you your final monthly payment.

Even after all that, you should still carefully review the sales contract . You don't need to read the whole document, but make sure it's not filled with unknown charges or terms. Remember, there's no turning back once you sign.

That's It. You're Done!

Take the time to relax and drive. Enjoy your car. You've learned a lot, and you'll be that much more prepared for your next automotive transaction.

2024 Hyundai Palisade

Other research topics

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Car prices are cooling, but should you buy new or used? Here are pros and cons.

Spring and summer may be good times to buy a car as manufacturers overcome pandemic-related supply interruptions, but remember, good is relative. 

Yes, prices have come down from their pandemic peaks , but if you haven’t walked into a dealership since early 2020, the prices you see will be “eye-popping,” said Pat Ryan, chief executive of CoPilot, an AI-assisted car-shopping app. New car prices are up 29% since March 2020 and used car prices up 34%, both outpacing overall inflation of 23%, he said.  

If you can accept that higher car prices are simply “the new normal,” Ryan maintains that the next several months will be prime buying season, with new cars providing the best value if you can afford it. 

“Used (cars) can only go down so far because during the pandemic, we produced 10 million less cars than we normally would,” Ryan said. On the other hand, automakers are churning out more cars with supply chains normalizing. 

Why can new cars be a better value? 

If you can afford to pay more for a new car, they could offer better value because manufacturers are producing more cars than people want so they’re offering more incentives, Ryan said. 

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As an example, he said, you would expect to pay $0.63 on the dollar of the original sticker price for a used car. Now that’s probably about $0.80. “So, the price is very high versus historically, so why not get a new one with more features,” he said. “You’re only getting a 20% discount from what that used car (cost when it) was new, which is not a great deal.” 

Additionally, used cars now are older and have more miles than they used to. Those under $20,000 on average have over 22,000 more miles than before the pandemic, while cars under $30,000 averaged more than 11,000 more miles, Cars.com said. 

A new car might drop down to $0.97 on the dollar, but you might also pay a lower interest rate, he said. 

It’s true, “you can usually get a longer-term payment on a new car, so from a budgeting standpoint, you could have the same payment on a new versus used vehicle,” said Rebecca Lindland, senior director of industry data and insights at car shopping site Cars.com. “But we encourage people to shop by MSRP (manufacturer's suggested retail price) so you can figure out what you’re paying for the car (rather) than strictly go by payment.” 

She encourages shoppers to use tools on comparison sites like Cars.com to get a handle on what they can afford and what they're paying.

High prices are the ‘new normal’ 

Car prices have eased recently, but no one should expect them ever to return anywhere close to pre-pandemic levels, car experts say.  

“These prices are in a new normal,” Lindland said. “Part of it is (what) we expect from a new car these days. We expect a new car to have the latest technology , to have certain features, and all of those features cost money.” 

New car prices fell below $49,000 in February for the first time in more than a year and below the August 2023 high of $50,253, thanks to more dealer discounts and automaker incentives, according to Cars.com . But that’s still 29% higher than the average pre-pandemic price of about $38,000 in February 2020. 

Used car prices averaged $31,556 in March, down from a peak of $32,889 in April 2022 but still 33% more than March 2020’s $23,691. 

How is used car inventory? 

As of Feb. 2, dealers nationwide had 80 days of new-vehicle supply, the highest since June 2020, according to Cox Automotive . 

Used cars had 44 days of supply , which was nearly flat from a year ago, Cox said. 

Even better for shoppers is that lower-priced vehicles in both categories have risen.  

About 30% of used cars are priced under $20,000, up from about 12% during the pandemic but still below 52% before COVID-19 struck, Ryan said. New vehicles under $30,000 now hover around 12% of all cars, up from 8% during the pandemic but lower than the 38% available before COVID-19, he said. 

Even if inventories are higher, competition may be stiff. For example, more than half of consumers plan to pay under $30,000 for a new car, a Cars.com survey showed. 

But what about the insurance? Car insurance prices soar even as inflation eases. Which states have the highest rates?

What about EVs? 

“New EVs are still more expensive than the average car, but there’s a lot more supply of used EVs, so consumers now have opportunity to look at an EV,” Lindland said. "They have a chance to test drive, touch it, feel it, play with it, whereas before, you’d raise your hand and put in a reservation with nowhere to test-drive them." 

The government tax credit for EV purchases, though, is unlikely to move the affordability needle much in favor of EVs. The tighter restrictions this year make the pool of eligible models smaller , and the income requirement to qualify is very low, she said. 

Hot cars: MotorTrend showcases new models for 2024

To qualify, a buyer's income can't exceed $150,000, "and you're going to spend $54,000 on a new car?" Lindland said.

What’s hotter than EVs right now are hybrids , which combine electrification with the safety net of gas. Toyota hybrids are the most popular , capturing four of the 10 most popular cars, according to Cars.com. 

Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and  subscribe to our free Daily Money newsletter  for personal finance tips and business news every Monday through Friday.

Buying a Car Essay Example

I am in the market looking to purchase a new car and getting the best deal. This process requires me to establish some parameters. The negotiation setting will take place at my local car dealership where I am trying to buy a new Lexus that has a window sticker price or the manufacturer’s suggested retail price of $66,000. The MSRP is usually the “asking price” the seller wants for the vehicle that can be negotiated in the seller’s favor. This negotiation is best done in the live presence of purchasing the car and within the last three days of the month because it helps ensure the buyer finds the best deal. Usually, the last days of the month are times when car dealers try to meet their monthly-end quota. In other words, it when the seller is desperate in trying to get in the final car sales before their monthly performance review. Thus, the dealer’s floor manager will be my counterpart, and I will act as a buyer. 

However, the current price is not in my budget range and my negotiation strategy is to lower the markup on the car’s window sticker by focusing on three objectives that are related to the vehicle’s price analysis. The first objective is to reduce the window sticker price. Upon doing research on the internet, I have identified the relative price range for the car and concluded that I can buy the car at ten percent off the window sticker price of $59,400. This is based on past internet sales that previous buyers have made with other dealers. By reducing the car’s overall price, I can lower the monthly payments. The next objective is setting the monthly payment and terms. For example, the monthly payments would be set on the terms for sixty months at a three percent interest rate or lower by using a credit score that is above seven hundred. This ensures I receive the best rates in order to pay for the monthly car note that I have set at $1,100. Finally, the last objective is to discuss the vehicle’s maintenance cost with the seller. It includes oil changes and tire rotation for the first twenty-five thousand miles. These cost savings will provide for the cash proceeds to cover the monthly gas expense.

In any negotiation, I need to analyze my position by understanding my target point, reservation point, and best alternative to a negotiated agreement. My target point or the best deal is the vehicle’s final purchase price that is below $66,000. window sticker price. Specifically, it would at a price of $59,400 which is ten percent below the MSRP. If I can achieve this target point, it will encompass my other objectives, such as achieving my target monthly payments, monthly interest, and maintenance cost. Conversely, my reservation point or the highest price that I am willing to pay for the car is any price at or above $66,000. Based on online research, there is has been an established customer base purchase at this price point. Thus, any price beyond the reservation point will result in a larger depreciation loss as the car ages and also put me above my car note budget. Furthermore, in this negotiation deal, I have also identified my BATNA or best alternative to a negotiated agreement that describes my bottom line or a solution to the negotiation. Any price within the price range at $59,400 or $66,000 will be my BATNA because this is the price range is within the target and reservation price point. Hence, if I cannot obtain a car in this price range then I will walk away from the deal. I can use my BATNA to pressure the floor because it gives me the opportunity to search for a better deal at a different dealer. In essence, I can price shop for the best deal and leverage my reasoning for reducing the MSRP at the local car dealer. This will pressure the floor manager to call me back.

Buying any new car has several tangible and intangible interests for both buyer and seller during a negotiation process. Tangible interest is anything that can be measured. As a buyer, my tangible interest includes the car itself that will be represented as my property. In other words, the car will be the physical asset I gain in this negotiation process. Moreover, another tangible interest is the equipment that I receive from the car. For example, there will be new safety technology like adaptive cruise control, lane-keeping assists, and a backup rear-view camera. A new car also does not have a previous crash history. Instead, it comes with a warrant from the factory which reduces stress on unforeseen costs related to used cars. Finally, another tangible benefit is increased fuel economy because new cars are now lightweight yet use strong material to help burn less fuel which will help me save money on gas. On the other hand, intangible benefits in this negotiation include social benefits such as getting my kids safely to school. Also, the luxury service that comes with buying a luxury car. This includes the enjoyment of the VIP treatment, such as valet parking during a car’s maintenance visit at the dealer. Conversely, the seller’s tangible benefits are increased sales revenue for his/her dealership and personal commission by selling the car. Moreover, the seller’s non-tangible benefits include the verbal and physical interaction with customers that can give the seller more experience at his/her job. There could also be recognition and high praise from the seller’s sales manager that can offer better positions in the company if the deal is made. 

In this process, both seller and buyer also possess negotiation powers. As a buyer, I would have reward and expert powers. While these powers are normally given to managers within the organization, occasionally customers can have them as well. For example, one reward power that I would have is controlling the commission rewards for the sales representative. If I do not agree to buy the car, I can reduce the floor manager’s commission by walking away from my current emerging deal if I feel it is not decent as it should be. Moreover, I have expert power because, with the help of the internet, I can put forth data or other evidence to support any price reductions and receive the best deal. On the other hand, the seller has legitimate power. Despite not being able to obtain a commission if the deal is not made, the floor manager makes the final decision in selling the car. Also, the floor manager has expert power too because he has experience making deals in the past with other customers. Because he has a demonstrated successful history, he has knowledge on how to properly handle customers and make the deal in his favor. 

Because there are multiple related price issues like MSRP, monthly payment, and maintenance cost, there are various strategies to achieve integrative potential in this negotiation. To begin, it is vital to understand and incorporate the floor manager’s wants, needs, and concerns in order to achieve my desired price point. This way we both can shake hands and feel that there is a favorable outcome for both of us. I will start by listening to the seller’s concerns and ask the “why” questions to help me identify the floor manager’s BATNA. Once that is established, I can work on a solution. For example, if I cannot buy the car at $59,400 and he will not sell lower than $66,000, then I try to meet at the halfway price mark at $62,700. This will help reach us common ground because we both would have to compromise to a price away from our target points. Finally, I would take my time to identify our interests and constraints to build a proposal that creates value for both of us. For example, I believe humans interests can include something simple as recognition at work. Thus, I would indirectly tailor questions the help me identity his progress towards his sale goals. If the floor manager mentions he is doing almost better than the previous month, I could potentially help him reach his goal if we meet at the half-way price. This strategy would work because it would be incentivizing for the manager to take the deal and perhaps helping him earn an additional bonus for meeting his monthly quota. Consequently, understanding these steps in my negotiation process will ensure everyone’s interest.

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• How to buy a used car

How to buy a used car - Essay Example

• Subject: English
• Type: Essay
• Level: Undergraduate
• Pages: 2 (500 words)
• Downloads: 2
• Author: jenniegutmann

Extract of sample "How to buy a used car"

Informative Speech: How to buy a used car Central Idea: To inform General Purpose: To inform my audience about how theycan purchase a used car.Specific Purpose: To inform my audience as to how they can purchase a used car without getting having heartaches in the process.I. Tired of public transport? A. Put this into perspective: What do you do when you are tired of public transport? 1. What happens when your tolerance for public transport suddenly wanes? 2. You are constantly pummeled by the jostling that is characteristic of the public transport system. 3. You get home so tired every day when you get off work. B. Well, this is the moment you should do something about it.

A time to get rid of this hiccup called public transport. 1. If you have ever been a user of public transport, then you know how hectic the public transport system is. 2. Too much time is wasted in public transport due to delays. 3. So many vices surround public transport. C. Though transport is essential, it ought not to be cumbersome and discomforting to people. 1. People need to enjoy the transportation system. 2. Do you actually enjoy public transport?II. It is imperative for anyone buying a new car to consider a myriad of factors to ensure that they get the best-used car in the market and at a fair price. A. Is a used car the only option? 1. There is the possibility of buying a new car, even though it is dependent on how much money one is willing to spend. 2. Someone can decide to buy a bicycle, a scooter, or a motorcycle instead of a used car. 3. Used cars may not present the prestige one would wish to achieve with its purchase, but it still plays its role in transportation. B. What amount of money do you want to expend for purchasing a used car? 1. It is imperative for one to pay a sensible amount of money when it comes to buying a used car.

This will save one from going broke. 2. According to Garland Sommer in the book “Buying used vehicles: A quick guide to buying pre-owned vehicles in the 21st century”, the money spent for a car should not be more than 20% of your monthly take-home salary (Sommer 5). C. Selecting a car to purchase is very critical when it comes to the purchase of used cars. If the selection process is not well expedited, one may end up losing their investment in the care they purchase. 1. Consider buying a car from less popular but reliable manufacturers such Nissan, as they cheaper and durable. 2. It is also advisable to buy certified pre-owned (CPO) cars, which considerably lower the cost of the buying process. 3. For that reason, in terms of selection, the choice lies on the buyer.III. Checking prices and reviews is a critical process when it comes to purchasing used cars. A. check prices of vendors close to you. 1. When you check the prices of dealers closer to you, it makes it cheaper for you to acquire the car, as the transport costs are lower. 2. Comparing the prices offered by vendors is important in helping one to narrow down the list of the cars they would wish to purchase. 3. Additionally, checking prices being offered assists one to identify the brand of the car they would wish to purchase. B. According to Dr.

Shriram Shimpi in the journal article “A Study on Consumer Buying Behaviour for Used Cars in Pune City”, watching reviews assists one see the quality of the car, the reputation of the vendor, and the experience level of the vendor (Shimpi 31). 1. Watching reviews often provides information on cost, hence looking at reviews will enable one to make clear purchasing decisions. 2. Reviews enable one to gather information from different companies, making them easy for them to acquire a car.IV. According to Jeff Ostroff’s article “Buying a Used Car - Tips and Scams to Avoid.

Car Buying tips”, a myriad of steps must be followed if success in purchasing is to be attained. A. Contacting the seller is the first step in the final stages of acquiring a used car. 1. Immediately one sees a prospective car they would wish to purchase, it is necessary for them to contact the seller of the car. 2. Contacting the seller provides one with an opportunity to establish a relationship with the seller and to confirm the information given in the advertisement. 3. According to Jeff Ostroff, the seller should give information about the history of the car, which is necessary for making a decision to buy the car (Ostroff 1). B. Test-Driving the car is the second step.

According to Paul Nadjarian, it helps one familiarize with the car they would wish to buy. 1. Test-driving confirms if the car you are about to purchase is in good condition. 2. It is necessary for one to simulate conditions in the test drive that will take the car to extremes in order to test the versatility of the car. 3. After the test-drive, one should ask for service records in order to verify if the car has undergone scheduled maintenance operations as required. C. The third step is to have the car you are about to purchase inspected before you close the deal. 1. The car should be given to a competent mechanic for inspection in order to determine if there were defaults you missed in your test-drive. 2. If the inspection is satisfactory and you reach a conclusion to buy the car, it is important for the seller to transfer every ownership document to you. 3. Purchasing a used car is surely an involving process that must be expedited with caution if a good purchase is to be actualized.V. According to Alessandro Gavazza, Alessandro Lizzeri and Nikita Roketskiyk in the journal article “A Quantitative Analysis of the Used-Car Market”, purchasing a new car is an extremely fascinating though involving process, which involves examination of the utility of a car. A. If public transportation is a hassle for you, buying a used car is your best option. 1. Make sure you do not spend more money than reasonable on the car. 2. Escape the pain of cumbersome public transport. B. So, what factors do you consider when buying a used car? 1. The amount of money you wish to spend on the car. 2. It is essential to consider the make, as well as the utility level of the car you wish to buy (Gavazza, Lizzeri and Roketskiyk 10). C. How do you then purchase the used car? 1. Check prices and then look at reviews companies dealing in the used cars. 2. Contact the seller and have a discussion with them to create a relationship. 3. Conduct a test drive of the car; take it for inspection, before you finally close the deal.

Works CitedGavazza, Alessandro, Alessandro Lizzeri and Nikita Roketskiyk. A Quantitative Analysis of the Used-Car Market. American Economic Review, 104(11): 3668-3700. 2014. Nadjarian, Paul. How to buy a used vehicle: six tips for negotiating the best deal. The Christian Science Monitor, 2015. Ostroff, Jeff. Buying a Used Car - Tips and Scams to Avoid. Car Buying tips. 2015. Web. Available at https://www.carbuyingtips.com/used.htmShimpi, Shriram. A Study on Consumer Buying Behavior for Used Cars in Pune City.

Journal of Research in Commerce & Management, Volume No.1, Issue No.9Sommer, Garland. Buying used vehicles: A quick guide to buying pre-owned vehicles in the 21st century. Indianapolis, IN: Dog Ear Pub. 2007. Print.

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15 Questions To Ask When Buying A Used Car

Posted: March 3, 2024 | Last updated: March 3, 2024

The adventure of buying a used car can sometimes seem like a puzzle where the pieces are all hidden under the engine.  But don't let that scare you off!  As your trusty guide in this automotive jungle, I'm equipped with critical questions to help you crack the code of the pre-owned conundrum. 

1. What's the Car's History?

Just like you wouldn't marry someone without knowing their past (hopefully!), don't commit to a car without its life story. According to research , vehicles with a clean background often hold their worth better.

2. Why Are You Selling the Car?

This is like reading between the lines of a dating profile: the answer might be more telling than the photo. If they're upgrading, great! If it's because the car often plays hide and seek with reliability, well...it’s a red flag!

3: How Many Miles Are on the Odometer?

Mileage isn't just a number – it's like the car's "age in car years." Think of it as a pedometer; the higher the number, the more stories (and potential issues) it might have.

4. Can I See the Maintenance Records?

A car without maintenance records is like a student without report cards. You don't know if it's an A+ or barely passing. A Consumer Reports study showed that regular maintenance can greatly extend a car's life.

5. Has the Car Been in Any Accidents?

Accidents are the skeletons in a car's closet. Even if it looks pristine now, a past accident can affect everything from alignment to resale value.

6. How Many Owners Has the Car Had?

Think of this as the car's relationship history. A one-owner car might have had a steadier life than one that's been passed around more than a hot potato at a BBQ.

7. Are There Any Outstanding Recalls?

Safety first! A car with unresolved recalls is like a ticking time bomb; you want to defuse it before driving off.

8. Can I Take it to My Mechanic?

Trust, but verify. If the seller hesitates, that's a red flag worthy of a matador. So always ask this question.

9. Are There Any Fluid Leaks?

Cars, like humans, shouldn't leak fluids. If it's marking its territory with oil or coolant, it's a no-go.

10. How Are the Tires?

Tires tell a tale. Worn-out tires can be a sign of neglect or alignment issues. Plus, new tires are an added expense you'll want to avoid right after purchase.

11. Can I See the Car's Title?

No title, no deal. It's the car's birth certificate and passport all in one. Make sure it's clean and clear.

12. Are There Any Modifications?

Modifications can be cool, but they can also affect reliability and warranty. It's like dating someone with a lot of tattoos; intriguing, but know the story behind them.

13. Is There a Return Policy?

Buying a used car isn't like swiping right on Tinder; you should have the option to reconsider. Make sure there's a grace period for returns.

14. Why Is This the Price?

Don't just accept the price tag at face value. It's your cue to start a negotiation. Ask why it's priced that way to understand its value and show you're a savvy shopper ready to discuss a fair deal.

15. Can I Have a Test Drive?

Never buy a car without a test drive. It's like marrying someone you've only texted. You need to feel the chemistry!

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ESSAY; Moscow's China Card

By William Safire

• Sept. 8, 1986

Every decade or so, China undergoes a political convulsion. In 1948-49, the Communists threw out the Kuomintang; in 1956, Mao's ''Great Leap Forward'' plunged the country into a depression; in 1966, the Cultural Revolution to purify the party brought on a new Dark Ages; in 1976-78, we saw Mao's would-be radical successors, the ''Gang of Four,'' replaced by pragmatic Deng Xiaoping.

Now we are celebrating the 10th anniversary of the death of Mao, and some Pekingologists would have us believe that this decade's upheaval will not come.

Mr. Deng, at 82, has provided for his succession, we are assured: it's all set for Hu Yaobang and Zhao Ziyang to succeed him, with Hu Qili of the next generation right behind. Not to worry, goes the current Edgar Snow-job: China's new era of ''commutalism,'' communism with a capitalist face, will march undisturbed into the next millennium.

I wonder. Maybe the conventional wisdom will prove right for once. But for argument's sake, let's look at what is happening in China through a different set of glasses, seeking truth from facts.

Fact number one is that a wave of materialism is sweeping across the billion people of China. After a generation of repression, good ol' greed is back in the saddle, and an I'm-all right-Deng attitude permeates the new entrepreneurs.

As a longtime expositor of the virtue of greed in powering the engine of social progress, I cannot cluck-cluck at this. But there is a difference between the materialism of the Chinese on Taiwan, who are accustomed to free enterprise, and the lust for the good life of available goods on the mainland, where a terrible thirst has been a-building.

Let us assume that the outburst of materialism in China leads to some reaction: that some spoilsport faction emerges to summon up the ghost of Mao's ideological purity, and that this new gang of fortyish Outs finds its way back in. It is at least a possibility.

I think that shrewd old Deng is well aware of this possibility. That is why, despite his ostentatious rejection of personal cultdom, he is preparing his most dramatic assault on the memory of Mao. That father of the revolution startled the world by breaking with the Soviet Union; Mr. Deng, playing a revisionist Lenin to Mao's Marx, wants to startle the world and overwhelm internal opposition by a rapprochement with Moscow.

Accordingly, fact two: He has abandoned his demand that Russia move back its huge army from the Chinese border, thereby double-crossing his own Army leaders. He has forgotten his requirement that Soviet forces be withdrawn from Afghanistan, thereby double-crossing his Westernish ally, Pakistan.

All Mr. Deng now asks of the Russians is that they try to squeeze their Vietnamese clients to pull out of Cambodia. Of course they'll try - ''best efforts'' is an easy promise - and since the Vietnamese are notoriously independent, Moscow cannot be blamed for not succeeding. Result: Mr. Deng takes the salute from atop the wall in Red Square.

That reestablishes his Communist credentials, defanging hard-left opposition at home. And it is Middle Kingdom orthodoxy; I suspect Chinese agents in the U.S. supply the K.G.B. with intelligence, just as Peking permits our Big Ears on its soil to overhear Kremlin transmissions. Chinese policy has always been to play the barbarians against each other.

This theory would also explain fact three: Mr. Gorbachev's seizure of a U.S. newsman as hostage. It is no coincidence that this particular hostage selection follows China's arrest and expulsion of a reporter for a U.S. newspaper. The Soviet leader, advised by Anatoly Dobrynin, must have known that this slap in the face would jeopardize a summit - and went ahead with his calculated humiliation, similar to Mr. Nixon's mining of Haiphong harbor before his Moscow summit in 1972.

Because the Russians now have the prospect of a pilgrimage to Moscow by Mr. Deng, they can taunt the U.S. President with impunity. As Mr. Dobrynin probably predicted, Mr. Reagan is reduced to begging for the hostage's release, in effect volunteering testimony to a Soviet court, in his eagerness to crown his Presidency with a peacemaking summit.

Now Mr. Gorbachev can hang tough, holding a show trial and thereby delaying negotiations with the U.S. until the Deng visit - or can graciously accede to the Reagan plea, thereby establishing his dominance. And the overconfident Mr. Reagan never suspected, as he sat down to summit poker, that this time the China card was in his opponent's hand.