Car Insurance

Are you in the market for a car? If so, here are three good reasons to buy a used vehicle:

(1) you can’t afford a new one;
(2) you want the better value intrinsic in buying a used car, since new cars greatly

depreciate in value in the first few years;
(3) you get more car for the money–an old luxury car can cost as little as a new economy

car.

The good news is that there are plenty of great used cars out there. Because new cars last

longer and remain more reliable, there is a better selection of used cars available. The bad

news is that buying one can get complicated. You will need to set a budget, determine what

types of cars are acceptable, decide where to buy, find the right car, have it inspected for

quality and then negotiate price–before you hit the gas.

Of course, the more money you have, the better your selection. The most reliable used cars

are the newer ones. Since so many new cars are leased rather than purchased these days,

there are plenty of fairly new machines on the market. That means well-maintained two- and

three-year-old cars are common. For the ultimate in buyer confidence, many new car dealers

offer a factory-backed “Certified Used Car” program. This gives you a car with a warranty

similar to what you’d get if you bought a new car. The downside is that this is also the

most expensive way to buy a used car.

Regardless of where you buy it, however, a new car may still have some of the original

warranty left. New car warranties today are commonly three years or 36,000 miles, whichever

comes first. Some luxury brands extend that another year. The important thing is to verify

any promises made by the seller. The previous owner must have completed specified

maintenance items to keep a warranty intact. This is just one reason why complete service

records for a car add to its value.

USED CAR SOURCES

There are three places to buy a used car: new car dealers, used car dealers and private

parties. New car dealers have the best access to factory service and get first pick of

off-lease cars of the same brand they sell new. You’ll pay more to get this assurance of a

quality vehicle. The independent used car dealer usually buys cars at an auction without

having the opportunity to do a complete mechanical inspection. Although some of these

dealers have been in business for a long time and are reputable, be aware that such

businesses are less likely to provide the best customer service. Check them out carefully

with consumer organizations and the Better Business Bureau. If there’s a problem, each state

has its own laws about recourse, so it’s a good idea to know the local rules ahead of time.

Most used car purchases are deals between private parties. This is the way to get the lowest

price. The downside is that you can’t expect the seller to be around if you have problems.

You must do all your footwork before you hand over the cash.

If you’re buying from a friend or relative, you will likely get an honest appraisal of the

vehicle. If a car has problems, most people won’t want to stick their friends with it. But

before you turn a good friend into an enemy, make sure you know what you’re buying anyway

and accept that the car is being sold “as is.”

The one seller you want to avoid is called a “curbstone” dealer. This is a person who buys

and resells cars frequently as a business, but who poses as a private party. This person

will meet you in a parking lot or come to your house, but will not meet you at his or her

own residence. The ownership title of the vehicle will not be in his or her name. Because

these are the least scrupulous sellers, they often cover over problems that a car might

have. Check the documentation, including the ownership papers, of any used car before you

buy it.

HAVE THE CAR INSPECTED

In any private transaction, regardless of the documentation, you should always have a car

properly inspected. Even if the car is new enough to still have time left on the original

warranty, an inspection is crucial. A car could have been damaged and then repaired. But if

the repair was done improperly, or the damage was too severe, the warranty may have been

invalidated.

When you have found the car you want to buy, go to a professional mechanic who is familiar

with inspections. The best mechanics will give you a list of items that are checked and will

go over the car with you after the inspection. After carefully examining engine, suspension,

electrical, brake and other components, you will have a much better idea of whether the car

is in good and properly maintained condition. A simple look at the oil–is it clean or black

and dirty?–will tell you if it has been changed recently. The $50 to $100 expense of a

thorough inspection can sometimes buy you as much peace of mind as paying $1,000 or $2,000

more at a dealership. If the seller isn’t willing to have the car checked out, be extremely

wary. There could be something seriously wrong with the vehicle. If you can’t take the car

off the premises for an inspection, bring your mechanic to the car. When it comes to a used

vehicle purchase, you’re in the driver’s seat.

Finding out how much a used car is worth can be difficult. You should start with a published

guidebook, such as the NADA Official Used Car Guide or the Kelley Blue Book, often available

at your local library. There are also Websites with this information. Often you will get

values for trade-in, wholesale and retail. Prices are revised weekly. The retail figure is

the one the dealership hopes to get. It’s a high value for even the best used car. The

wholesale price is generally a reasonable figure for a transaction between private parties

if the vehicle is in good shape. If you plan on trading in another vehicle when you make a

purchase, don’t tell the seller about it until after you have a firm deal. Then bring up the

subject of a trade-in to find out how much you’re really being offered.

The most important thing to realize when you’re buying an older car is that it’s going to need maintenance and repair work. Allow for that in your budget. That aging but still useful BMW may look like a great deal now, but remember, it’s going to cost a lot more to keep running than a newer and less luxurious Toyota. Luxury cars have more expensive features to maintain, and they remain expensive to maintain as they age. Keep the costs for parts and service in mind before you use up your entire budget on the initial purchase price. Buying a classic car is a different matter. But unless you’re an expert mechanic ready to take on a challenge, avoid that “fixer-upper” car. It could cost you more than its purchase price before it’s in good shape. Unless you can supply the labor, it’s nearly always cheaper to buy a good car than to fix up a marginal one.