Marc Cuniberti
A friend of mine called for my advice on how to buy a used car. I have previously covered how to buy a new car on Money Matters but never a used car.
When I got out of college, I started selling cars with a buddy of mine. At that time the price difference for a BMW model 2002 between Southern California and Northern California was about 25% and the 2002 was the car to own in Marin County in the early 80s. We figured we could make about $500.00 per car on average. That was pretty healthy for two kids right out of college. Eventually, we branched off to include more makes and models, and in the process learned a lot about the used car business
On the buying side, there are certain things to look for at the onset. Once you’ve decided what make and model you want, check the web for reviews on the cars you are considering and begin the elimination process there.
Some of the things making for a better car are higher freeway miles (versus around town miles), the condition of the car if it has been repainted or not, and whether the owner has any service records.
The ideal car for me is an original owner car, with no accidents as verified by a Carfax document, and is owned by a family who has all the service records. Although some cars wont check all the boxes as to what is ideal, always take your time before buying as a car is an expensive investment.
Oddly, I often found that original owners with proper documentation usually were the ones that didn’t ask a premium price. On the other hand, those that buy and sell cars on the side (called curbing) often ask a premium price.
Original-owner families can often be emotionally swayed to sell their “baby” (the car) to people they like. For that reason, always be super nice, dress sharply, and be clean-cut and forthright. Subjective I know but it works.
As a general rule, we avoided used car lots, as the prices were a little bit higher, but I have bought cars from lots on occasion.
Certain car lots can offer fairly good deals, and I’ve found the best deals there to be older models but with lower miles.
One of my favorite ways of finding good deals was finding cars with for-sale signs on them when driving around town. I often found them to be family owned and many an original owner sells their cars this way. If you see a car in the driveway that looks pristine with a “For Sale” sign on it, chances are it could be a great find.
Look for a car with low miles, is in decent shape, has not been repainted, with lots of service records, and a clean Carfax. I like older years but with low miles. Buy the miles is sound advice.
You can research approximate car prices on KBB or Edmonds, but prices I find there can be out of date. It is better to see what is actually selling on sites like CarGurus or another car-selling page. Pages like Carvana are not a place I find helpful as they tend to ask for dealer prices instead of realistic for-sale by-owner prices.
There are warning signs to look for when buying used cars. The pink slip (owner certificate) should be in the seller’s name. If they say they’re selling it for a friend or relative, beware.
A re-painted car is not a good idea. When a car is repainted, the new paint is not as durable as the factory paint. Especially avoid cars whose color has been changed.
A car that has been hit or has an accident on its Carfax, unless it’s a verifiable very small accident, is a car I would avoid. Ditto with any title that says “salvage”.
Because I’ve sold cars, I know how to drive them and feel what is going on with the vehicle, so unless you are a mechanic, it’s a good idea to take the car in and get it checked out. An honest seller should find a way to make this happen.
Before you go that far, however, look closely at all the areas of the car, inside and out, and test all the electrical functions.
Cars that have been brought in from out of state should be inspected closely underneath the running boards and behind-the-wheel wells for corroded areas which are another no-no.
Don’t buy any car with rust on the body.
Also, look down the sides of the car at various angles for rough finishes and waves which could signal previous bodywork. And make sure you look at your car at least once in broad daylight.
In conclusion, look for clean cars with original paint, clean titles with a clean CARFAX, and cars with lots of service records.
The fewer previous owners the better. Add in good reviews and what appears to be a wholesome person or family behind the sale, and you improve your chances of getting a nice used car.
“Watching the markets so you don’t have to”
(As mentioned please use the below disclaimer exactly) THANKS (Regulations)
This article expresses the opinion of Marc Cuniberti and is not meant as investment advice, or a recommendation to buy or sell any securities, nor represents the opinion of any bank, investment firm or RIA, nor this media outlet, its staff, members or underwriters. Mr. Cuniberti holds a B.A. in Economics with honors, 1979, and California Insurance License #0L34249 Email: [email protected]
