How to Buy a Used Car

Because used cars are all unique you'll have a hard time making car dealers compete like you should for new cars. But you can definitely save money buying used instead of new. The key to buying a quality used car at a good price is to take the right steps BEFORE you make an offer. You want to find a good deal and still feel comfortable that the car does not have any maintenance issues or a troubled past.

To buy a used car without having to worry if you're getting ripped off, follow these four steps:

Step 1 – Search Used Car Listings

To find a large variety of competitively priced cars, you'll need to search a large number of listings.

Search used car inventory on Edmunds or AutoTempest.

Step 2 – Check the Car's History and Condition


Avoid a major headache by verifying a used car's history and condition before making an offer. Take a lesson from car dealers who purchase used cars every day. They always run a vehicle history report on your trade-in before they buy it, and you should do the same. A vehicle history report will let you know if the car has been in a major accident, salvaged or reconstructed, stolen or was a lemon.

If something turns up when you run the report, you can avoid a costly mistake and skip making an offer. But if you still want the car, before you make an offer show the seller a printed copy of the report, and point out any issues that will help you justify a lower price.

For more information, learn how a vehicle history report works and read a comparison of the two main providers Autocheck and CARFAX.

It's also important to get the car inspected by a certified mechanic to catch any other issues that may not have been reported. Most auto repair shops will do a comprehensive inspection for $50-$150. Look for AAA or CAA discounts on inspections as well. Spending a little now to check up on a car has the potential to save you a lot in the long run. When buying off eBay or over long distances, the seller will often agree to arrange this for you if it means you're likely to purchase the vehicle. Just make sure the inspection is performed by a reputable shop.

Step 3 – Know the Car's Market Value

Before you make an offer on a used car, you must know the car's value. The price the seller has put in the window is not likely to be the market value. It's only a starting point for negotiations. There are two easy ways to get a realistic estimate of how much you should pay:

  1. Lookup the Edmunds True Market Value
  2. Search similar listings in a wider geography on AutoTempest or CarsDirect and try to find a comparable car that has a lower selling price.

Bring printouts of both of these items and use them as proof the seller is asking too much. Forget about the seller's initial price, just give a realistic bid. If you have documentation that your bid is in line with market prices, it's very difficult for a seller to argue the facts.

And be sure to use pricing that reflects the current condition of a car. Edmunds TMV will let you factor the car's condition into the price, by selecting: “Outstanding”, “Clean”, “Average”, “Rough”, or “Damaged”. Many times a seller will price their car based on “Outstanding” condition, but there are almost always small dents, scratches, and wear and tear that make the car in less than perfect condition. Be sure to detect and point out these flaws to the seller and explain that they should be reflected in the price.

Step 4 – Used Car Financing

Whether you're buying from a used car dealer or private party, knowing your credit and finding competitive online financing are key to saving money on your financing terms.

If you're buying from a used car dealership, use the same approach you would use to finance a new car. Get pre-approved before going to the dealer and ask the Finance Manager to beat your interest rate. You'll find it's harder to find a lender if you are buying from a private party, but you can still get a competitive rate from

Used Car Checklist – Making an Offer


In summary, there are several steps you should take before making an offer on a used car. When you are ready, bring the following items to get the best price on a used car.