Buying a Used Car in the US



 

If you don't have enough money, then you should consider buying a used car. Depending on the model, the maker, age, mileage, condition, etc. A used car can cost you anywhere between $ 1500 to $ 5000.

In this section we address the various issues regarding buying a used car.


Related Links
  Basic Info
  Buying a New Car
  Buying a Used Car
  Seal the Deal

  
Driver License
  Car Insurance

  Rent a Car




General process of buying a used car

Factors that determine the price of a used car

Benefits and drawbacks of buying a used car

Researching used cars

Seal the Deal

FAQ's

Where should I search for used car(s)?

How do I find the actual market value of a car?

Where can I find financing or get loans for buying a used car?

Is it ok to negotiate on the price of a used car?

 

General process of buying a used car

Below we outline the normal (general) process for buying an used car:

    1. Consult with your friends who have previous experience in buying a car

    2. Set your budget

    3. Decide on your preferences for the car (brand, model, mileage, color, type (sports cars, sedan, etc.,), condition, etc)

    4. Search for the car (online, dealers, friends, magazines, etc) that fits in your budget

    5. If you like a car, ask the seller for its VIN. Using the VIN, check out the vehicle history

    6. Check out the vehicle' market value (e.g. using Kelly Blue Book)

    7. If you are satisfied with the car's history, do a test drive to get a feel of the car

    8. If you still like it, then take it to an experienced mechanic (check with your friends or colleagues for a car mechanic) or an auto store such as Goodyear Firestones.or Bridgetone. Ask the mechanic to check the condition of the engine as well as the other parts of the car. The mechanic will charge you anywhere from $25 to $60 for the check.

    9. If you are satisfied with the results, buy the car. If not, repeat the above steps to look for another car.

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Factors that determine the price of a used car

Usually a "good" used car will cost you anywhere from $1,500 to $5,000.

However, the cost of a car depends on various factors. We have listed some of the important factors below:

    1. Make and model of the car (Japanese brands such as Toyota, Honda will command more price compared to American brands such as Ford, GM, etc)

    2. Age of the car (a 5 year old car will be costlier than a 8 year old car), mileage (a car that has traveled 50,000 miles will be costlier than a car that has traveled 85,000 miles)
      As a rule of thumb, if a car run for less than 10,000 miles / year, it means that it is not overly used.

    3. Condition of the car (e.g. whether it is scratched or not or whether the tires have just been replaced)

    4. Seller's perceived value of his car (many times the sellers think that their car has much more value than the actual market value)

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Benefits and drawbacks of buying a used car

Benefits: The main benefit of buying a used car is that it is very cheap. This is the only reason why students prefer buying an used car. As a student, most probably, you will have limited budget. You can buy a used car for about $1,500 to $5,000. A used car will satisfy most of your traveling needs such as going to the college, going to the grocery stores or even short trips to nearby cities and towns.

Drawbacks: You might have to spend some money on the yearly maintenance of the car. A used car can have myriad of problems, and you might need to replace various part of the car, such as the timing belt, serpentine belt, tires, alternator, etc. You cannot predict when the car may break down. If you are driving long distance, and if the car breaks down in the middle of your journey, you might be in big trouble and inconvenience.

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Researching used cars

You can definitely do some research on the car so that you can make an educated decision about the purchase. This is extremely important before buying any car. You should not pay a high price for a car that is no longer good (e.g. has had a big accident).

To avoid this, you should check out the history of the car. The history of a car will tell you various things such as its previous owners, were there any accidents on the car, etc. Every vehicle in the US has a Vehicle Identification Number (VIN). You will have to use the VIN of the car to find out the past history of the car.

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Where should I search for used car(s)?

You can buy a used car from the following:

Web sites: Some web sites such as cars.com, autocars.com, etc., provide listings of used cars. People (private sellers) put information about their cars. They provide information such as the make, model, price, mileage, etc. Sometimes they also provide a picture of the car. You can do a search based on the location (use zip code) to find out the sellers in your area.

Dealers: Some car dealers are specialized in selling used cars. Most dealers will allow you to take a test ride. You don't have to immediately purchase a car. You can take test ride of different cars and see how you feel while driving them and then take your decision.

Friends/Colleagues: Many times, your friends will also be the ones who want to sell their car, so, keep your eyes and ears open. Your friends will definitely provide you an honest information about the car and maybe, also give you a discount.

Used Car Magazines: There are magazines that provide listings of used cars in your ares. You can get these magazines for free in your local grocery or convenience stores.

Notice / Advertisement Boards: Some people will also list information about their cars on notice boards around the University (libraries and labs), grocery stores, etc.

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How do I find the actual market value of a used car?

A website called Kelley Blue Book specializes in determining the actual market value of a car. You only need to submit basic information about your car such as the make, model, age, mileage, condition, etc. Then, the web site will provide you the actual market value of the car.

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Where can I find financing or get loans for buying a used car?

If you are not a citizen or a Green Card holder, or if you don't have a fixed regular income, it is hard to get financing in the US. Nevertheless, you can talk with your bank or even with the dealer to check out if there are any financing options. Some dealers might allow you to pay in regular installments (pay the car monthly). The financing option will be more flexible for you if you buy the car from your friend.

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Is it OK to negotiate on the price of a used car?

Of course, it is ok to negotiate the on the price of the car. In fact, you should not buy any car without negotiating. In most cases, the seller will put a margin in the selling price of the car. You should negotiate with him on the price of the car. If you negotiate well, the seller will definitely reduce the price by a couple of hundred dollars. The lowering of the selling price is not guaranteed, but its worth a try.

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