Apply Now

5 Most Important Things To Look For When Buying A Used Car

Posted by Auto Loan Solutions

In the past, buying a used car might have seemed like something only the financially insecure or desperate might do.

Most people dreamed to going to the traditional car dealership, selecting their new car, paying handsomely for it, and then driving it off the lot as the first people to ever be behind the wheel.

The idea of “new is best” has been rapidly fading over the past few decades, as people come to realise the benefits of buying used cars instead. Not only do used cars hold their value longer, they have withstood the test of time, and buying one could be seen as more environmentally friendly as that car won’t end up in landfill for a little while longer.

Purchasing a used car can be fraught with risk if you aren’t careful before putting your money down. We’ve put together a list of the five most important things you need to look for when buying a used car and getting used car financing.

Cost vs Worth

Man buying used car financing in toronto

One of the ways in which buying used and new differ is in understanding the relationship between the relative worth and cost of your vehicle.

When you are buying new, generally the price of the car is in line with the worth of the car. This is because the sticker price on a new car is usually close to the RRP from the car manufacturer, and so could be taken as the real world worth of the car.

This relationship between price and worth becomes less clear when it comes to used cars. The second a brand new car is driven off the dealership lot, it typically loses between 10 to 20 percent of its value immediately. As a car ages it continues to depreciate, however, different cars will lose value at different rates.

Calculating the rate at which a car depreciates is not an exact science, and will depend on a variety of factors including market demand, the rarity of the car, whether it has a reputation for being extremely reliable, the overall condition of the car, and so on.
Thus, before you take the first price that is given to you when looking at a used car, do your research and find out what other people have been selling and buying this particular car for in your area. This way you’ll enter negotiations with all the right knowledge to ensure you are paying a fair price for your car, and not end up paying too much in interest should you take out used car financing.

Verify the VIN

One of the most important pieces of information you can get from your potential future car is its Vehicle Identification Number (VIN).

This string of 17 letters and numbers contains almost everything you might want to know about this specific car, including where it was made, what its exact model is, its engine size, what type of gas it uses, and so on.

The VIN is usually located near the base of the windshield or in the doorframe on the driver’s side of the car. Ask the seller for this number when you initially contact them and enter it into a free online VIN checking tool to verify the various stats they provide about the car.

Checking the VIN number can give you peace of mind that you are getting what you are paying for and aren’t being deceived when it comes to performance or model.

Car History Check is a must

Getting a car history check is vital when it comes to buying a used car.

Cars go through a lot in their lives, from minor accidents to potential write offs. Whilst most issues can be repaired and the car and continue back on the road, there are several incidents in the past that can result in the car becoming uninsurable.

Flood damage and a complete write off are two incidents that typically mean that the car will never be legally allowed on the road again. This is because, whilst the car might be able to be repaired and can drive ok, insurance companies will never cover the car and thus it cannot be allowed back on the roads.

Clearly this is something you will want to know before buying a used car. Car history checks are usually relatively cheap, approximately $30, and provide you insight into every event in a car’s history that required professional attention.

Getting a car history check means you will be able to get used car financing at a better rate, and also gives you peace of mind that you are getting a car that will last you the distance.

Ask for a test drive

Used car financing at dealership in toronto

Naturally one of the first things you will want to ask for when prospecting a used car is a test drive.

Trialling the car before you buy it gives you a chance to verify that the car runs adequately, and to gauge how it handles. A test drive will allow you to get a feel for the individual quirks of the car, as well as confirm the mileage and whether the instrument dashboard is working.

Ultimately, the test drive is your moment to decide whether this car feels right for you and whether it is worth your money. If you get a good feeling from the test drive, then this might be the car for you. Conversely, if you aren’t enjoying the ride, you should probably pass on this one.

Ask about known mechanical issues

This is probably already at the top of your own list of things you want to know about your potential car, but we are including it here again due to its importance – always ask about any known or potential future mechanical issues.

One of the key benefits of buying a used car is the immediate cost savings compared to buying new. New cars usually cost a minimum of $12,000 to $15,000, whereas you can easily find a used car for under $3,000.

However, those savings can quickly evaporate if things start to go wrong with the used car. Things like oil leaks, rusting, and the dreaded engine replacement, are all not uncommon issues a used car might experience.

Of course you expect some repairs to be required of a cheap used car, but any of the more extensive repairs can become prohibitively expensive. This can really begin to strain your finances if you have also taken out used car financing to purchase the vehicle.

Make sure you confirm with the seller any known mechanical issues, any issues the car has had in the past, and whether the car is due for maintenance in the near future. You may have to take their responses with a grain of salt if they are trying to sell you on their car, but it never hurts to ask.

Dealing with unregulated used car marketplaces can be stressful and time consuming. If you don’t have the time to sift through the fake listing and scams, contact today and choose from one of our 7,000 new and certified used cars.

Apply Now