Used cars can be a smart financial move only when you pay attention to detail. While a used car is often cheaper than a new one, it can also be a bag of problems when you buy impulsively. Whether you’re buying from a dealership like conklincdjrnewton.com or a private seller, you need the right knowledge and resources to make the best decision.
Here are the important things to do before buying a used car.
Set a budget
Budgeting is a smart financial plan that shows you how much you have and how much goes into each pressing need. When setting your budget, it is best to consider the short- and long-term costs of buying a used car. For example, a cheap used car may be aged and have a higher tendency to break down.
It is also good to consider other costs like maintenance, repairs, and servicing when setting out your budget. These costs, when added to taxes, title, fees, and insurance, can set you back a few extra dollars.
Use online sites like Edmunds or tools like budget calculator if you’re unsure what to budget for your used car needs.
Consider your long-term costs
The initial purchase price of your car is little compared to how much you may need to spend on it in the future. It is important to consider the long-term cost of ownership before buying. Prepare for repairs and maintenance, insurance, taxes, gas, and other costs.
You should also consider the cost of parts and repairs of the vehicle make and model. Please remember that some vehicles have costlier or scarce parts. The cost and availability of your vehicle’s parts can make all the difference down the line.
If you’re buying a used car for the first time, it is best to choose vehicle makes and models whose parts are common on the market. Unsure of what to buy? Use online resources like RepairPal to gauge the repair costs of major vehicle brands and models.
Request your credit score
Not everybody can afford to pay cash, even for a used car. If you’re planning on financing, you must know your credit score and how it affects your chances. Request your credit report from the three major credit bureaus or contact your bank/credit card company.
Prospective used car buyers with great credit scores stand a better chance of securing a loan at a favorable rate. A good credit score also attracts a good auto insurance rate.
If your credit score is less than perfect, you can either hold off on the purchase while you sort out existing or outstanding debt or prepare for a slightly higher lending rate.
Get pre-approved
It is best to get a loan pre-approval before hunting for cars. This is especially true if you’re financing your used car purchase. A pre-approval gives you an idea of what the lender is willing to loan you. This amount can be used to plan your desired used vehicle.
Pro Tip: You’re better off not spending the entire pre-approved amount on your vehicle purchase. Keeping some money for your short-term running cost can save you a lot of financial hardship.
Don’t fall for Scam
Buying a used car requires all your senses to be active and sharp. If it looks too good to be true, it may be too good to be true.
Always remember that you are under no legal obligation to submit a credit check by a dealer through whom you’re financing a used car purchase. Ensure that you do not fall for the Patriotic Act scam wherein the dealer requires you to submit for verification.
You should also stay away from shady brokers with no verifiable office address or good reviews.
Obtain a vehicle history report
A vehicle history report tells you everything (almost everything) you need to know about a car. Two trusted companies providing this report are AutoCheck and Carfax. The report tells you what and where the car has been up to. It also gives you an idea of the vehicle’s accident history, prior owners, service history, etc.
While this report can be trusted, you should also remember that not everything shows up on these reports. It is best to thoroughly check the vehicle in itself to ensure you’re buying the real deal, not a lemon. Looking out for bodywork signs, which often indicate an unreported accident, can also help.
Submit the VIN through the National Insurance Crime Bureau
A vehicle’s VIN holds much information about it. It is essentially the vehicle’s identity or Social Security Number (SSN). Many people run scams using their vehicles, and these scams are often reported to the National Insurance Crime Bureau (NICB).
You are allowed five free searches daily on the NICB platform. You can use this service to check for the vehicle’s crime history.
Note: Stay away from vehicles that have been reported stolen or those that show up as salvaged or totaled.
Research the vehicle’s resale value
The average resale value of any vehicle is a key metric to consider before buying it. Some vehicles have a high resale value making them a worthy investment. Others with low resale value may be a hassle to sell off when planning an upgrade.
You can use online tools and resources to determine the vehicle’s used/resale value before purchasing.
Don’t get emotionally attached or rigid
One of the biggest mistakes you can make when buying a used car is to become emotionally attached. The second worst is to be rigid with your choice. Emotional attachment can cloud your judgment, causing you to pay more for less.
As a rule of thumb, be ready to walk away during negotiations. Ensure that the used car serves your purpose and is well within your budget. Also, ensure that you aren’t compromising on your quality standards, especially if you have a reasonable budget.
Take third-party inspection and test drive seriously
Third-party inspections and test drives are two areas you must never compromise on. A trained and experienced auto mechanic should do a third-party inspection of the car before you buy. These professionals can spot car problems from a mile away, saving you the stress and costs of repairing those problems.
On the other hand, a test drive shows you how smoothly the vehicle drives. Always remember that you can walk away anytime, especially if things don’t appear right.
Following these steps will improve your chances of buying the right used car for your needs.