The Complex Guide to Buying a Used Car

In an ideal world, we'd all be able to buy new cars all the time. And they would all be mid-engined and Italian. However, this is certainly not an ideal world, so used cars are the way to go for most of us, most of the time.

Buying a used car is full of pitfalls, and they're mostly in front of the buyer; the seller has the advantage of already knowing all about the car. While there's no foolproof way to know whether a used car is a good buy or not, most of the crap can be filtered out if the buyer takes the right steps.

Here's how to take those steps.

The Complex Guide To Buying A Used Car.

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So that old hooptie you inherited from your older brother has finally seen the big red stop sign at the end of the road. The first thing you need to do is assess your funds. How much do you have to spend now on a car, and how much can you afford to spend on a monthly basis.

If your credit rating is hovering around 12, don't even think of financing anything, just see how much you can scrape together. If you do have a decent credit score and a monthly payment won't break the bank, find out how much you can afford to pay per month, and then approach a bank to see how large of a loan that gets you. Don't pick an arbitrary number and then find out what the monthly payment will be; that will only cause you pain, and missed utility payments.

Remember though, interest hurts. If you get a five year loan with a decent 3.99 APR for five grand, you'll pay around $5,523.60 for it. If you do decide to finance, remember that you wallet will be doing much better in the long run if you can pay more than the minimum payment every month. The sooner you get that loan paid off the less you've simply given to the bank for the privilege of having some money now.

Certified Pre-Owned cars have been through a thorough inspection and come with an extended warranty, which is great. Honda's CPO program, for example, adds 2 years/40,000 miles to the powertrain warranty and 1 year/12,000 miles to the non-powertrain warranty, in addition to the 150 point inspection. Of course, if one looks at two identical Honda Civics that are two years old and have 30,000 miles on them, the CPO Civic will be notably more expensive. Think of it as repair insurance.

If you buy a used car, on the other hand, there still might be a little of the original warranty left, but it's usually best to just assume that there isn't. You will be able to afford a newer/less used/cooler car than if you looked at CPO models though.

What kind of car are you looking for? Do you live up a steep gravel driveway in Michigan (if so, you should probably move) and want something with some off-road ability? Something sporty? Drop-top? Do you need to haul a lot of cargo? How many doors do you need? How many seats do you need? Do you want a small car that's easy to park in the city or a boat for cruising Midwestern highways?

Once you've answered these questions, start looking at models that match your needs and desires on websites like Auto Trader and eBay to see what falls within your price range.

Get on Yelp and Car Talk and find a good mechanic, preferably one who specializes in the make of car you're hoping to buy. You're going to want to spend a little time chatting with him (enough to build up a little report without irritating him by taking him away from his work) and let him know that you're planning to bring a car in to him just to make sure you're not getting screwed.

Get a quote on what it will cost him to check out a car and get him to let you know exactly how thorough an examination will be required.

Buying a car that looks like a great deal but is 2,834 miles away on eBay is usually a bad idea, unless it's under warranty or a classic that you plan to restore anyway. There are a lot of ways you can get screwed over on a used car, and not being able to look at it, drive it, or bring it to your mechanic until after you've bought it and spent a couple hundred bucks to either go get it or have it shipped to you is a bad idea.

We know it's tempting, but please, buy locally and have your mechanic check it out.

The first step in negotiating a price for an automobile is knowing who you're talking to. If you're getting a car from a dealer, you're talking to a professional negotiator, which has its own set of challenges. If you're talking to a private owner, the trained negotiation skills probably won't be there, but emotion and weird quirks be present. Before you talk to either person, however, remember to know what your goal price is, and what price will make you walk away from the deal. Here are some tips for haggling to help you out with this step:

Remeber that mechanic you befriended a few slides ago? Before you buy the car, get the seller to agree to let you have it for a couple of days so that you can have an independent inspection done. If the seller says "no," give him the finger and walk away.

Drop it off at your new mechanic friend and hope everything checks out. If there are repairs to be done, either walk away from the deal or convince the seller to drop the price by enough to repair the car.

This part's fairly simple; you give the seller your money, take the car and signed title, and go to the DMV to register your new car. Be sure to call your insurance agent to get your insurance in effect as well.

You did save some money for registration, title, tags, and insurance... right?