Buying a used car can cost you significantly less than buying a new model, but it comes with some risks. Before you purchase a used car, here’s a checklist of what to consider to ensure you make an informed decision and get value for your money.
Set a Budget
A car is a significant investment. Before buying one, create a budget and stick to it. Budgeting is pretty straightforward if you’re paying for the car in cash. But, if you’re taking out a car loan, plan to set aside at most 10% of your income to finance the purchase. You can also apply for auto loan refinancing to get better terms or rates on an existing car loan. However, before you apply to refinance a car loan, the experts at Lantern by SoFi recommend paying close attention to the rates and terms because they vary greatly from lender to lender.
Compare Used Car Prices
The Internet is an excellent used car shopping tool. Check out various sites to see what’s available and what you can afford. You’ll get pricing details from one seller to another, ensuring you don’t overspend. Once you’re done browsing online, you can then visit private sellers, car dealerships, and independent used car lots to test the model you’re considering.
Test drive the Car
Test driving a used car is the best way to know if it’s in good condition. It’s also an excellent way to get a feel for the car to know whether it’s suitable for you. Pick a test drive route with varied terrain to ensure you perform a thorough test and drive with the radio turned off to allow you to listen to the car’s performance.
Here are some things to check during the test drive:
- Does the ca r start easily?
- Does the air conditioning work properly?
- Are the seats comfortable?
- Is the driving position comfortable?
- Are the headroom and legroom sufficient?
- Are there any strange sounds like rattling and squeaking coming from the engine or brakes?
- Does the steering feel stiff?
- Are the tires in good shape, and is there enough tread left?
- Is there any unusual smoke coming from the exhaust?
- Do the brake lights, headlights, and tail lights work properly?
- After the test drive, you can turn on the radio and turn up the volume to test if it’s working properly.
Inspect the Car
After the test drive, some issues may require a closer look. If you enjoyed driving the car and it performed well, take it to a mechanic for a rigorous inspection. A pre-purchase inspection can reveal issues you may not have noticed and save you from incurring costly repairs down the line.
Check the Paperwork
A used car should come with various documents like a registration certificate, insurance papers, a service book, and a road tax receipt. Request for all the required documentation before finalizing the deal.
Negotiate a Good Deal
Negotiating may sound daunting, but it doesn’t have to be. Here are some tips on how you can get the most out of the deal during the negotiation:
- Set a maximum price you’re willing to spend to buy the used car.
- Open with an offer that’s lower than your maximum price but close to the average price of the car on the market. Justify your offer using the facts you discovered while performing research online.
- If the seller rejects your initial offer, make a counteroffer that’s closer to your maximum price.
- If you and the seller agree on an amount you’re willing to spend, close the deal. However, inquire about any additional fees before finalizing the deal. Some dealers include hidden fees they don’t mention during the negotiation.
- Before you pay for the used car, ensure you close the deal correctly to avoid issues down the line. For instance, if you’re buying the car from a private seller, ensure the seller properly transfers the title and registration to you.
- Purchasing a used car can prove challenging. Before you purchase one and regret your decision, use these tips to ensure you get value for your money.