How to buy a used car in 8 steps
While there is no denying the excitement of that new car smell, the fact is that many people can’t afford to or prefer not to buy a new car. One deciding factor may be depreciation on new cars—it’s estimated that the average car loses 20 percent of its value as soon as you buy it and 30 percent in the first year.
So, if you’re in the market for a deal on used wheels, follow these tips for buying a used car for a smoother ride!
Step 1: Crunch the numbers
Decide how you plan to pay for your new car. If you’re paying cash, your budget is set. If you’re taking out an auto loan, your lender will determine how much you can afford.
Also, consider getting pre-approved for your loan before visiting the seller. Greater Alliance Federal Credit Union has a pre-approval process as well as competitive rates on used auto loans and a First Time Auto Buyer Program.
Step 2: Create a target list
Decide what make and model car you want to buy. Check out guides like Consumer Reports® for vehicle reliability ratings on the most recent model years. Aim to narrow your choices to three or four model cars.
Step 3: Research
Perhaps the most important tip for buying a used car is doing thorough research. Start researching prices and listings for your vehicles of choice. Visit a site like Cars.com® to get started. You can find used cars for sale in any of these locations:
- The used-car section of new-car dealerships
- Used-car dealerships
- Used-car retailers like CarMax®
- Websites like Craigslist® where car owners privately sell their vehicles
When researching cars and listing prices, determine the average asking price for each car. Next, find out all you can about each vehicle with a vehicle history report from Carfax.com. Greater Alliance offers FREE unlimited Carfax reports to all its members.
Step 4: Call the seller
Contact the seller to verify the information you’ve learned about each car. If you’re using a private-party seller, ask about any possible mechanical issues. If you’re working with a dealership, ask if the car is still in stock and for any information you couldn’t find on your own.
If everything checks out, set up an appointment for a test drive.
Step 5: Test drive
This is when car buying gets fun—getting behind the wheel! Make sure to pay attention to these details during the test-drive:
- Is there sufficient leg room?
- Is the ride smooth?
- How is the acceleration?
- Does the “check engine” light come on?
- Do you have full visibility?
- Are the brakes working well?
- Do all the lights and blinkers work?
Next, ask for the vehicle’s service records to determine if it’s current on scheduled maintenance.
Step 6: Have it inspected
Having your car inspected by a mechanic before you buy can save you aggravation and lots of money down the line.
Step 7: Negotiate
Make an opening offer based on the average price for your car and use all the information you’ve learned about your vehicle as bargaining chips. Be firm, and you will end up with a fairly priced vehicle. Once you’ve landed on a price, this is when you’ll want to finalize your financing if you’re taking out a loan.
Step 8: Make it official
If you’re buying your car from a private-party seller, make sure the title and registration are officially transferred to you. If buying from a dealer, give careful thought to any extra protection a warranty offers. Finally, read the contract carefully and make sure you have insurance before you make it official.
Start with Greater Alliance Federal Credit Union
We hope you find these tips for buying a used car helpful the next time you’re in the market. See how we can help. When you visit our Auto Loans page, you’ll find all kinds of helpful information, including an Auto Buying Center, Auto Loan Calculator, Enterprise Car Sales offering options for low rate pre-owned cars and much more. If you’re wondering how to buy a used car, start with us! Contact Us or call (888) 554-2328 to learn more.
Then you’ll be set to take your new car for its first spin!