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How to Buy a Used Car

How to Buy a Used Car: The Ultimate Guide

If you don’t know how to buy a used car, there’s a chance you’ll pay top dollar for an unreliable vehicle. Fortunately, the automobile purchasing process is easy when you know where to look, what car to get, and how to check reliability. Learn how to do all this and more in this car buying guide. 

With lower sticker prices and slower depreciation, used cars can provide excellent value to buyers. Still, pre-owned cars have previous owners and long histories, so you must ensure you’re getting a good deal. 

This can seem quite daunting, but you can make the process easier by knowing the best places to look for used cars, how to get each option, and what steps to take to secure financing. Learn how to buy a used car without the hassle so you can find the ideal pre-owned vehicle. 

Where is the best place to buy a used car?

You can find secondhand cars for sale online and in person. Also, you can choose to buy from a dealership or a private party. Go over your options for shopping for pre-owned vehicles to see which is right for you. 

Online markets and web listings

If you want lots of options at your fingertips, consider shopping online. Online car markets and web listings offer used cars from private sellers and dealerships. Some markets, such as Autotrader, connect buyers to financing and handle most of the paperwork. 

Authorized car dealerships

Car dealerships have both new and used vehicles available from various brands. For instance, if you go to a Ford dealership, you might see used Ford, Toyota, and Honda models in the same place. If you’re interested in the dealership’s brand, you can check out certified pre-owned vehicles with warranties. 

Car dealerships typically inspect pre-owned vehicles and fix issues before selling them. Also, dealerships provide financing and handle the paperwork. You can also purchase additional services, such as roadside assistance, through a dealership.

Before going this route, you must keep a couple of things in mind. First, expect a pushy sales team if you use a dealership. Also, dealerships often charge higher prices than online marketplaces and private sellers. 

Still, you can find a fair price by vetting dealerships ahead of time. Read car dealership reviews before deciding which one to visit. Then, you’ll know which dealerships to skip and which to visit. 

Physical car markets

You can choose from lots of different makes and models in person by going to a physical car market, such as CarMax. Make sure you do your research before heading to a car market, though. The salespeople generally aren’t experts in all the makes and models and might be unable to answer your questions. 

Private sellers

If you don’t want to buy from a dealership, you can browse used cars for sale from private sellers. Private sellers list cars on online marketplaces and classified ads. You can even find listings on social media, especially Facebook Marketplace. 

Private sellers are often motivated to sell as quickly as possible so you can find a great deal. However, that comes with some risk. These cars are typically sold as-is, and you won’t have much recourse if the car ends up being a lemon.

You’ll also be on the hook for handling the paperwork if you go with a private seller, unless you use Autotrader or another service that does it for you. 

How to select a used car 

With so many makes and models available, you must do your homework before choosing a car. Refer to this used car buying checklist to help you select the ideal vehicle. 

Consider your budget

You don’t want to overspend on a vehicle, so think of your budget ahead of time. Be sure to factor in the cost of used car financing and insurance. 

Choose the features you want and need

Many pre-owned vehicles have safety features like blind spot detection and backup cameras. Determine which features are best for you and your family so you can find the right used car for your needs.

Once safety is out of the way, think of other features you want in a car. Do you want heated seats or four-wheel drive? Maybe a large infotainment system is important to you. Write down all the features to help you weed out cars when shopping in person or online. 

Match your lifestyle

You need to find a car that fits your lifestyle so you’re happy with it well after signing the paperwork. For instance, a sports car isn’t ideal if you carpool a group of kids to school every day. Instead, you’ll want an SUV or minivan with ample seating.

Check for spaciousness 

No matter your lifestyle, you don’t want to feel cramped inside a car. Make sure you go with a make and model with enough room for you and your passengers.   

Fuel type

Decide if you want a car that uses diesel or gasoline. If you go with gasoline, do additional research to see if the car runs on regular gas or needs premium fuel. Regular fuel is around 50 cents a gallon less than premium gas, so many used car buyers prefer sticking with that. 

Maintenance level

Do you want a low-fuss car, or can you handle lots of maintenance? The answer to this question will help you eliminate some possibilities. Then, you’ll be that much closer to finding the car. 

Test drive your car

A car can look great on paper, but you won’t know if it’s what you want and need until you drive it. Schedule a test drive at the dealership or with a private seller before buying the car. Follow these test-driving tips to get the information you need. 

Comfort and space assessment

Start the test drive by sliding behind the wheel and seeing how it feels. Is it comfortable and provides plenty of space? If so, move to the backseat to check for comfort and space again. 

Finally, evaluate the cargo and storage areas to ensure you’ll have enough room for your gear. You can even bring items you normally carry in your car to see if they fit. 

Check the lights and features

Bring someone to the test drive with you and have the person stand outside the car when you turn it on. Check the lights and signals and review the dashboard to make sure there aren’t any warning lights.

Next, test the features, such as the sound system and navigation. If everything’s working as it should, you’ll be ready to hit the road. 

Assess the state of the car by driving

You don’t need to go on a long test drive to evaluate the car, but you do need to put it through its paces. See how the car performs turning left and right, going up and down hills, and on side roads and the interstate.

During the drive, check the acceleration, braking, and visibility. Also, listen for noises that indicate something’s wrong with the car.  

Research reliability

Reliability is an important consideration when buying a pre-owned car. If you want something that’ll last for years, follow the best used car buying strategies regarding reliability. 

Choose a trusted brand and model

You probably know that Honda and Toyota are among the most trusted brands, but there are other reliable options out there, too. Use a resource such as J.D. Power, Consumer Reports, or Kelley Blue Book to see which brands and models receive high reliability scores.  


Reliable cars need fewer repairs, while unreliable cars have high ownership costs. Use a cost of ownership calculator to find out how much you’ll likely spend on maintenance and repairs. If the cost is high, consider going with a more reliable brand or model. 


When considering how to buy a used car, it’s important to think about depreciation. Used cars don’t depreciate as rapidly as new cars do. That’s one reason many consumers prefer buying used. 

Still, some pre-owned vehicles depreciate quickly. If you buy a car that loses value immediately, you’ll have trouble getting good value when trading or selling it. You can find out how much the used car will depreciate by using a cost of ownership calculator.

Check the car for damage and overuse

Once you find a car, you must make sure it’s a good deal. You should already know if it’s a reliable make and model, but take the extra step by checking the mileage, reviewing the vehicle history report, and having it inspected. 

Check the mileage

On average, motorists drive 13,476 miles per year. Multiply that number by the age of the car to see if it’s been driven more or less than average. If it has excess miles on it, it might need maintenance and repairs sooner than other cars made in the same year. 

Check the vehicle history report

Some sellers provide a copy of the vehicle history report free of charge. If not, you can obtain one from Carfax, carVertical, or another service. Input the VIN to get the report and review it to see if the car has hidden damage, odometer fraud, or other issues. 

Get a car inspection

Finally, take the car to an ASE-certified mechanic for a pre-purchase inspection. Detailed used car inspections can uncover hidden damage, evaluate completed repairs, and determine the car’s condition. Your mechanic can even provide insight into future maintenance costs. 

How to pay for a used car

There are two components to paying for a used car. First, you can negotiate to lower the price. Then, follow that up by applying for used car financing. Learn more by reading these negotiation and financing tips for buying pre-owned cars.

Negotiating for a used car

You can negotiate the price of the used car, whether you’re buying from a dealership or a private party. Start by getting the car’s current value on Kelley Blue Book. Subtract up to 10% from the value to start negotiations.

Private sellers and dealers aren’t likely to accept the first offer. Instead, they’ll make a counteroffer, and you can counter that. Go up in small increments until you reach an agreement with the seller. 

How to get a car loan for a used car?

Banks, credit unions, and other financial institutions provide used car financing when buying from a dealership. Generally, financial institutions are willing to finance used cars less than ten years old, but some extend loans for older vehicles. Additionally, some offer loans for cars under 100,000 miles, and others are less concerned about mileage.

You can’t get a traditional used car loan if you buy from a private party. Instead, you can apply for a private-party auto loan through your bank, credit union, or an online financial institution. Private-party auto loans typically have higher interest rates than traditional loans, so factor that in when setting your budget.

Finally, you can take out a personal loan to finance a used car. Since you won’t put up collateral, you’ll need stellar credit to get approved. You can find personal loans online or through your bank or credit union.  

Why are used cars more expensive than new?

You can find some great deals on pre-owned vehicles, but that isn’t always the case. Lightly used cars are sometimes more expensive than secondhand cars. Also, there are some factors that can drive up the cost of owning a used car. 

Maintenance and repair costs 

New cars typically require less maintenance and fewer repairs than used cars do. In fact, the cost of ownership generally increases each year after buying a car.  

Lack of warranties 

New cars come with warranties, which can save you money if anything goes wrong. Depending on the used car you select, there’s a good chance it won’t be covered at the time of purchase. You can get coverage while still buying used by choosing a certified pre-owned car.  

High demand

Recent shutdowns and chip shortages have led to a lower supply of new cars on the market. This has increased the demand for used cars, so the pre-owned vehicle supply is dwindling, too. The increased demand and competition have caused used car prices to go up. 


What is the best age and mileage for a used car?

Look for vehicles up to six years old with fewer than 50,000 miles. 

What to check when buying a used car from a private seller?

Check the vehicle history report, mileage, and title before buying from a private seller. Also, an ASE-certified mechanic should inspect the car. 

What is the optimal number of previous owners for a used car? 

One owner is the optimal number when buying a used car. Still, you can find reliable cars with two or three previous owners.

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