It is estimated that cars depreciate by about 30% of the initial value within the first three years of use. While this may not be good news for those who like buying new cars, it’s a sweet deal for prudent used car buyers. Many three-year-old cars are in excellent condition, and some can still be under the manufacturer’s warranty. However, you should know a few key things if you want to get the best value for money when buying a second-hand car. So before you visit the next used car lot or log into an online automobile auction, here are tips to help you get started.
Step 1: Start By Doing Online Research
One of the main things that people place as a top priority when buying second-hand cars is price. Although you want to save a few bucks and land a good deal, cost shouldn’t be the only factor at play. This is why research is really important.
You need to look at other things, such as mileage, the car’s condition, service history, and maintenance costs. Online research helps you compare prices from various dealers, read reviews, and source information about the vehicle’s history. Having all this information at hand ensures the dealer has no upper hand or an opportunity to oversell a car you could have gotten for less.
Finally, you need to prepare a list of potential used-car dealers or car auction sites to check out and see if you can find the type of car you want at a fair price.
Step 2: Conduct an In-Person Inspection
Once you find the kind of car you want, you need to do a thorough vehicle inspection before you sign any dotted lines or agree to any payment terms. But what exactly does such an inspection involve?
For starters, visually inspect the car by looking for any significant dents or signs that the car may have been involved in an accident before. If you notice the car has a new paint coat, ask why they had to repaint it. Visiting the car yard with a mechanic is the best way to complete a thorough inspection.
Next, you need to take it for a test drive. This will help you get a feel of the engine performance and is also a chance to listen for any unusual noises coming from the vehicle.
The last part involves confirming that the car details from the seller are true. Here, you will have to conduct a vehicle history information check. This will help you see the ownership details, confirm the odometer readings, and check for any accident reports or flood damage.
Step 3: Negotiate with the Seller
Let’s face it: you want a second-hand car so you can get it at a cheaper price. The negotiation stage is the most important step to determine how much you can save by discussing the seller’s price. So, what are some negotiating tactics that can give you the upper hand?
- The first step is to ensure you know the market value of the car you want to buy. This is why we insist on doing your own research to get an idea of how many different dealers are selling the car.
- Secondly, set a ceiling on how much you’re willing to pay. A realistic budget will ensure you don’t overspend or end up with monthly repayments that will be challenging to keep up with.
- Next, determine what your initial offer will be. For instance, if a car is selling for $5500 and you are willing to pay a maximum of $5000, you should start your price at $4000 to increase your chances of settling for $5000 with the seller. An extra tip here is to let the dealer mention their prices first. You may be surprised to find it cheaper than your planned budget.
- Lastly, be strategic and stay focused. During the negotiations, be polite to the seller and let them know you’ve done your research and you know the average prices of the car. Do not let the seller distract you by steering the conversation to other things, such as extra, maintenance, or insurance, without agreeing on the price first.
Step 4: Be Prepared to Walk Away
Sometimes, finding a good deal means visiting several car lots or attending a few car auctions. There will be days when the seller won’t budge on their set price. Don’t be afraid to walk away if the price is more than you can afford. Visit other dealerships, and eventually, you are bound to find what you want at a fair price.
Step 5: Know all the Fees Involved
There are various extra fees that many dealerships don’t include in the price of the car. Some of the fees to expect or watch out for include:
- Sales tax
- Title and registration fees
- Documentation fee, which is the fee for finalizing the paperwork for the car sale
- Extended warranties
- Insurance fees
Getting a good deal on a used car is all about researching, finding the right dealership, and negotiating the price. There are many online car auctions where you can search for deals; in most cases, these purchases are straightforward and easier. Good luck in your search!