Not only can buying a certified pre owned car save money for the purchaser, it also ensures they have a greater variation of options at hand. CPO cars also make great first vehicles for new drivers who are at a greater risk for getting in an accident than their avid driver counterparts.
If you think you're alone on the used car-hunting journey, you're far from it. According to Edmunds' Used Vehicle Market Report, 38.5 million used vehicles were sold in 2016. Each year, that number increases.
However, before buying a used car, there are some things you must know in order to get the best price, and most all of, receive what you think you're buying.
Pick a price range.
Many people often have difficulty coming up with a price range when looking for a used car. This is because second-hand vehicles range drastically depending on the type of vehicle, model, original price, condition, the miles it has, and how old the vehicle is.
A good idea when deciding on a price range for a used car is to consider your annual income. Typically, CPO car buyers will want to look for a CPO vehicle that's 10 to 15 percent of their income to ensure they won't be in the hole after making that big purchase.
For instance, if you make $20,000 a year, consider making your price range in the $2,000 to $3,000 range.
If you plan on using a loan to pay for your used car, ensure you keep up with each monthly payment. Getting a favorable interest rate is always a bonus. A loan may help you expand what you can purchase right upfront.
Ponder on different brands and models.
An advantage of opting for buying a used car over a new car is that there are so many colors, styles, ages, models, and brands to pick from, some of which may no longer be manufactured. You may even come across a classic when on your hunt.
For your used car, you may want a certain brand (Ford, Honda, etc.), model, or even style (truck, sedan, hatchback, etc.).
Some specifics to keep in mind when thinking of what you want include:
- How many people you wish to seat
- Style of trunk
- Up-to-tech technology – yay or nay?
- Material of seats
- Stick shift or automatic
- Ease of driving and parking
Once you have an idea of what you want, your search will be that much easier.
Decide on a seller: private or dealer.
Do you plan on buying a used car from a used car dealer or an individual seller? There are benefits to both. Buying from an individual can sometimes be cheaper, while buying a used car from a car lot, however, can be more secure. Private party sellers, however, may have a specific vehicle that a car dealer may not offer.
Consider surveying the Internet for used cars in your area if you plan going on the private seller route. You may find the right one prior to checking what a local car lot may offer.
Look up a car's book value to ensure you don't get ripped off.
The last thing you want to do is purchase a used vehicle for $4,000 when it's only worth a fraction of what you paid. The issue is than many car buyers get so antsy to swipe up a car that they forget that what it's being sold for doesn't mean that's what it's truly worth.
If you're uncertain what a specific used car model is worth, check out Kelley Blue Book where you can find out it's worth for free before you buy a used car higher than it's value.
Knowing a car's value is also a great idea if when trying to see which models are in your personal price range.
Check the vehicle's history report.
To make sure everything a seller is telling you about a vehicle you're interested in is correct, your best bet is to check the car's history report.
A history report can tell you the age of a vehicle, the number of reported accidents, amount of safety recalls, how many owners previously owned it, the type of engine it has, among other important information you'll want to know.
Vehicle history reports can be conducted for free from AutoCheck. All you need is the vehicle's VIN or license plate. A vehicle's VIN can also be used to tell you if the car has a manufacturer warranty still valid or not.
Know how to properly communicate with the seller.
Communicating with the seller of a car isn't just about being friendly and respectful; it's also about asking all the right questions.
When it comes to used cars, there are a lot of questions you should ask such as when the car last had a smog check, if there is any noticeable wear and tear you should know about, or if there are any problems that need to be addressed to ensure it runs properly.
Whether a car dealer or a private party seller, a seller who acts as if the car is in perfect condition and acts short with conversation to quicken the sell, it's almost always guaranteed that something is up with the vehicle, and they're hoping to lock in your sell before you find out.
Get a closer look inside and outside of the vehicle.
Without looking at the front, back, sides, and the interior of the used car you're seeking to purchase, you're risking a lot. Maybe one of the doors has a massive dent, or the leather seats inside are ripped to shreds. Be smart and properly observe your potential purchase beforehand.
Looking closely at the vehicle can also help you to bring down the cost if you notice something wrong with the used car that could lower its value, so keep your keys peeled.
CPO cars should be reliable more than anything else, unless you intentionally plan on buying a fixer upper.
Conduct a test drive.
Get to know the vehicle before you buy it. One way to do this is to give it a test drive. Not only will this ensure you get a feel of the wheel, but a test drive can also give you a better idea if anything obvious is wrong with the vehicle before you commit to it.
If the seller isn't willing to let you take it for a spin, ask if they can drive you around in it. If they decline, something might be up that they don't want you to know about.
Professional car dealers may be more likely to let you take the vehicle for a test drive than private sellers, so keep this in mind.
Negotiate your best price.
Once you've found a reliable option you like, it's time to negotiate the price of the car. While it's true that sellers would much rather get exactly what they're asking for, it doesn't hurt to drop the price down a bit with the goal to save money.
As a good piece of advice, initially try to negotiate a price that is below what you would actually pay. If the seller declines, wiggle the price higher. When buying a used car, don't be afraid to bring up the vehicle's worth or any issues you see present that could lower its value.
For instance, if a used vehicle is priced at $4,500, but you initially have a $3,800 budget, consider asking the seller if they'll give it to you for $3,500. Chances are, they probably won't, but once you raise it to $3,800, the negotiation doesn't seem so bad anymore.
Once you have your offer accept, congratulations—you've just bought yourself a used car! Hook that baby up to your insurance company, and you'll be riding safely in your new CPO vehicle.