A Helpful Guide to Buying a Used Car

It’s tough picking out a used vehicle. It’s something that you have to rely on for years after making the decision, and if you choose wrong, you could end up getting a vehicle that you simply don’t like, or that you can’t afford.

Budget Carefully

The worst thing you can do is to buy a vehicle that you can’t afford, or at least not comfortably. Step one in the shopping process is to determine how much money you can afford to pay each month after covering all of your current expenses. Once that figure has been determined, use an online calculator to help calculate the total price you can afford to pay for a car.

Knowing what you can afford does not necessarily equate to what you want to spend. If you sometimes have more month than money, you should probably go with the most economical car that will still meet your needs. It’s always good to be a bit cautious when making money-related decisions, in particular with a major purchase like a car. Be conservative. Don't lock yourself into five years of payments you "think" you can afford.

Factor in Hidden Costs

Car ownership brings costs beyond the sticker price of a vehicle. You also have to think about taxes, registration fees and other miscellaneous fees that dealerships will charge at the time of purchase. Make sure to consider all of these costs when deciding how much vehicle you can afford. Below are some common costs associated with vehicle ownership.

  • Depreciation
  • Vehicle maintenance
  • Insurance
  • Fees and taxes
  • Gas costs

Pick a Vehicle Type

Once you've established a budget, now comes the fun part: figuring out the type of vehicle that you want. First, think broadly about the way that you’ll be using the vehicle. If you have a growing family, a sexy two-seater is probably not the way to go.

After you decide on a particular style, be it truck, mid-sized sedan or SUV, it’s time to do a bit of research. Determine the most highly rated vehicles in the category and decide which options and features suit you best.

Once you have narrowed your choices, head to a dealership to try them out.  Choose a specific model or two that you are interested in buying, test drive them and then begin your search for used vehicles available in your area.

Not All Used Cars are Alike

Used cars fall into three basic categories, "As-Is," "With Warranty" and "Certified Pre-Owned." If it falls within your budget, the best buy would be a car from the "Certified Pre-Owned" category. These vehicles must pass a vigorous, manufacturer dictated screening process and will be offered with new car-like extended warranties.

While you are shopping, be sure not to overpay for a car just because it is a popular model. There are deals to be had on vehicles just as reliable that somehow failed to capture the public's fancy.

Get Looking

Search online, go old school with the classifieds or visit dealerships to see cars that match your needs. Once you have found one that is to your liking, give it a good going over. Drive it around, look under the hood, examine the interior for signs of water damage and test out all the electronic functions in the vehicle. Be thorough and you’ll be able to rule out most problematic vehicles.

Pull the Trigger

Now that you’ve established your budget, done your homework and sought out the vehicle that best fits your needs, buy it. If you have cash, great but, if you don't, shop for a lender. Doing so will give you the upper hand in the negotiation process.

Buying a car is at once an exciting and stressful time. Being properly prepared will allow you to enjoy the process and won't leave you kicking yourself once a month for the next five years.