Car Deal Canada

Best Way To Pay For a Used Car

Best Way To Pay For a Used Car

Buying a used car is one of the most exciting purchases you can make. After searching for that perfect ride, taking it for a test drive, and imagining yourself behind the wheel, the next step is figuring out how to pay for it. With the average used car price in Canada being around $25,000 in 2022, coming up with the money is no small feat.


But don’t let the payment process get you down. With some preparation and know-how, you can secure the financing you need for your used car purchase smoothly and stress-free. This comprehensive guide will walk you through the most popular payment methods for buying a used car in Canada, along with tips and strategies for getting the best possible deal.



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Pros and Cons of Paying Cash

Paying the full amount in cash is one way to purchase a used car without taking on any debt. Here are some of the main pros and cons to consider with this payment method:

Pros:

 

  • No interest charges – You avoid finance charges by not taking out a loan.
  • Can negotiate a lower price – Cash buyers have more leverage to negotiate a lower purchase price.
  • Full ownership – The car is completely yours with no lien.

 

Cons:

 

  • Need large amount saved upfront – You must have the full purchase price available, which can take a long time to save up.

 

Saving Up to Pay in Cash

One of the best ways to pay for a used car is to save up and pay with cash. This allows you to avoid interest charges and potentially negotiate a lower price since the dealer doesn’t have to worry about financing. However, saving up enough cash requires diligent budgeting and financial discipline over months or even years.

Aim to save at least 20% down if putting the rest on a loan. Calculate the total used car budget including taxes/fees so you know exactly how much cash is needed. Build up savings by:

 

  • Making a budget to reduce expenses and free up as much monthly cash as possible to put in savings
  • Putting any extra income like tax refunds, bonuses, or gifts directly into the used car savings fund
  • Using a high-yield savings account to earn interest on the money while saving
  • Contributing regularly each month over time until reaching the goal
  • Cutting back on non-essentials and limiting eating out and entertainment
  • Downsizing to a smaller living space to save on rent/mortgage
  • Working overtime or a side gig for extra income just for the car fund

 

With dedication over time, you can accumulate enough cash to buy a quality used car outright without any financing needed. Just be sure to keep the money somewhere secure like a savings account until ready to make the purchase.

 

Using a Personal Loan

Taking out a personal loan from your bank or credit union is another option to get the funds needed to purchase a used car upfront. With a personal loan, you borrow a lump sum amount all at once and pay it back in fixed monthly payments over a set repayment term, usually 1-5 years.

The benefits of using a personal loan to buy a used car include:

 

  • Ability to pay cash and potentially negotiate a better price
  • Fixed interest rate and monthly payments (predictable finances)
  • Typically lower interest rates than credit cards
  • Pay off the loan faster by making extra payments

 

Just be sure to compare interest rates from different lenders to get the best deal. Personal loans also require a credit check and you may need a good credit score to qualify and get a low rate. Make sure to calculate the total loan cost including interest so you know the true price of the vehicle.

 

Getting a Car Loan

One of the most popular ways to pay for a used car is by getting a car loan. With a car loan, you can pay for the vehicle over time in more affordable monthly payments rather than paying the full amount upfront. Here are some key points on getting a car loan:

The main benefit of a car loan is being able to spread out the cost of the used car into manageable monthly payments. Depending on the loan terms, you may be able to get a used car loan with payments as low as $200-300 per month. This makes buying a used car much more accessible.

However, you will pay interest on the loan, so the total cost will be more than just the sticker price of the used car. You’ll need to have good credit to qualify for the best interest rates. The better your credit score, the lower your interest rate will be on a used car loan.

Before applying for a used car loan, check your credit report and score. Aim for a score over 700 to get approved and get the lowest rates. Then, shop around and compare interest rates from banks, credit unions, and other lenders. Online lenders like banks often offer competitive rates too.

Getting pre-approved for financing will give you a budget and price range to stay within when shopping for your used car. Then you can negotiate the purchase price more confidently knowing what monthly payments you can afford.

 

Comparing Car Loan Lenders

When it comes to getting a car loan, you have three main options for lenders: banks, credit unions, and dealerships. Each has their own pros and cons to consider.

Banks typically offer competitive interest rates and loan terms to customers with good to excellent credit. Large national banks have the resources to offer loans in all 50 states. However, they may not be able to match the personalized service you’d get from a local lender.

Credit unions are non-profit organizations that exist to serve their members. They often offer lower interest rates and more flexible terms than banks. Credit unions rely on member deposits for lending capital, so loan approval may depend on your relationship with the credit union. They generally offer very personalized service.

Dealership financing can be convenient as part of the buying process. However, interest rates are often higher than banks or credit unions. The dealer may encourage you to take a longer loan term to lower payments, costing more in interest. Dealers may also push additional products and services.

To get the best rate, compare options from banks, credit unions, and the dealer. Preapproval from a bank or credit union gives you bargaining power to negotiate with the dealer. Review all the terms carefully to calculate the true total cost of any loan.

 

Using Dealer Financing

One convenient option for financing a used car purchase is to go through the dealer’s own financing program. Many dealerships work with lenders to offer financing right at the point of sale. This can provide several advantages:

 

Often Low Interest Rates

Dealers frequently offer promotional financing rates to move inventory. While not always the absolute lowest, dealer rates are usually competitive and attractive for buyers.

 

One-Stop Shopping Process

By handling everything at the dealership, you can purchase and finance the car in one seamless process without needing to arrange financing beforehand.

 

Limited Selection

A drawback is that you are limited to the lenders the dealer works with, rather than shopping around more broadly. This may mean missing out on better rates available elsewhere.

When weighing dealer financing, be sure to negotiate the interest rate and avoid any unnecessary extras like extended warranties that will only increase the total cost. While dealer financing can be convenient, taking the time to check other lenders could save you money in the long run.

 

Leasing a Used Car

Leasing a used car is another option to consider when buying a vehicle. With leasing, you make lower monthly payments compared to financing since you are essentially renting the car. At the end of the lease term, which is typically 2-3 years, you return the car to the dealer. This means you’ll always be driving a newer model vehicle every few years.

The main advantage of leasing is the lower monthly payment. Since you are not purchasing the vehicle outright, your payments only cover the vehicle’s depreciation during the lease term plus rent charges and fees. Depending on the lease terms, your monthly payments could be significantly less than loan payments to buy the same car.

The downside is that you never own the car at the end of the lease. You have to return the vehicle unless you decide to buy it. Leases also come with strict mileage limits, typically 12,000-15,000 miles per year. Going over the mileage limit results in excess mileage fees when you turn in the car. Wear and tear on the vehicle beyond normal use can also mean charges.

Before leasing, be sure to research the car’s residual value, which is its estimated value at the end of the lease. A higher residual value means lower monthly payments but a lower buyout price if you want to purchase the car after. You’ll also want to understand the money factor, which is similar to APR for a car loan.

To avoid excess fees, be realistic about your annual mileage needs. Also take good care of the vehicle and address any repairs needed to avoid excessive wear and tear charges. With the right planning, leasing can be an affordable way to drive a used car.

 

Should You Lease or Finance?

When deciding between leasing or financing a used car, it’s important to compare the total costs of each option.

With leasing, you’ll generally have lower monthly payments compared to financing since you’re only paying for the vehicle’s depreciation during the lease term, plus interest. However, leases come with restrictions on mileage, which usually range from 10,000-15,000 miles per year. Going over the limit means paying extra per mile fees. Leases also require you to return the car in good condition at the end, or you’ll face additional wear-and-tear charges.

Financing used cars allows you to spread out the total cost over several years through a loan. Your monthly payments will be higher than leasing since you’re paying off the entire vehicle purchase price plus interest. But once the loan is paid off, you own the car free and clear. There are no mileage restrictions, so you can drive the car as much as you want without penalties. You also aren’t liable for any wear and tear on the vehicle.

To determine the better option, calculate and compare the total costs. Add up the monthly payments, down payment, taxes/fees, interest charges, and any potential mileage overage or wear-and-tear fees for both options. This will give you a clear picture of the total expenditure for leasing versus financing so you can choose the more cost-effective option.

 

Paying with Credit Card

Using a credit card to pay for a used car purchase can be an attractive option for some buyers. The main benefits of paying with a credit card include:

 

  • Earning rewards or cashback on your purchase
  • Taking advantage of the grace period to delay payment

 

Many credit cards offer generous rewards programs, allowing you to earn 1-5% cash back or points on your spending. For a $10,000 used car purchase, that could mean getting $100-$500 in rewards. Just make sure your credit card actually offers rewards on large purchases before assuming it will.

Additionally, if your credit card has an interest-free grace period, you can delay payment on the car for 20-25 days typically. This gives you some breathing room before the credit card payment is due. However, it’s critical that you pay off the full balance when it comes due. If you carry a balance after the grace period, high interest charges will erase any rewards earned.

Before using a credit card, understand your rewards earning potential and ensure you can pay the balance in full. Rewards can help offset some of the cost, but you don’t want to end up paying more in interest charges down the road.

 

Tips for Getting the Best Deal

When paying for a used car in Canada, it’s important to negotiate the best possible price and terms. Here are some tips to help you get the best deal:

 

Negotiate the Price

Don’t be afraid to negotiate with both private sellers and dealers. Do your research ahead of time on fair market prices using resources like Kelley Blue Book and Autotrader. This will give you leverage when negotiating. Start lower than asking price and be prepared to walk away if you can’t get close to your target price range.

 

Shop Interest Rates

If financing, get rate quotes from several lenders including banks, credit unions, and online lenders. Compare all the options to find the lowest interest rate and best loan terms. Dealers may offer low promotional rates but you can likely find even better rates elsewhere.

 

Read All Terms Thoroughly

Carefully read any financing agreement before signing. Look for details like loan length, APR, fees, prepayment penalties and more. Ask questions if you don’t understand something. Don’t feel rushed – it’s a major financial decision.

 

Calculating Total Cost

When considering different financing options to pay for your used car, it’s important to calculate the total cost you’ll pay over the lifetime of the loan. This includes fees, interest charges, taxes, and your down payment. To get an accurate picture:

 

  • Add up the sticker price, sales tax, documentation fees, and any other charges from the dealer. This is the total you would pay in cash.
  • If financing, factor in the interest rate, length of the loan term, and any lender fees. Multiply the interest rate by the loan amount to estimate total interest charges.
  • Don’t forget sales tax – you usually have to pay this upfront even when financing.
  • Add your down payment amount to the above costs to determine the total you’ll pay by the end of the loan.

 

Online auto loan calculators can help estimate your total loan cost based on the loan details you input. Being aware of the total cost can help you determine if it fits your budget. It also allows you to compare financing offers to find the most affordable option.

 

Paying Off Your Loan Faster

One of the best ways to save money when financing a used car is to pay off your loan faster. This reduces the amount of interest you pay over the life of the loan. Here are some tips for paying down your auto loan quickly:

 

Make Extra Payments

Most lenders allow you to pay extra towards the principal of your loan each month with no penalties. Even small extra payments of $20-50 per month can make a big difference over time. For example, paying an extra $50 a month on a 5-year loan at 4% interest would let you pay off the loan almost a full year early, saving over $500 in interest.

 

Refinance Your Loan

If your credit score has improved since you took out your original loan, you may qualify for a lower interest rate by refinancing. Getting just 1-2% shaved off your rate can accelerate your payoff date. Shop rates from online lenders and check if your bank or credit union offers auto loan refinancing. Just beware of fees that could cancel out interest savings.

 

Trade In Your Current Car

Trading in your used car while you still owe money on it rolls the remaining balance into your new loan. This gives you a fresh start with a new term. Just be sure the trade-in value exceeds what you owe so you don’t end up with negative equity. Dealers make the trade-in process easy but may offer less than selling the car yourself.

 

Closing Tips and Recap

As you can see, there are several options for paying for a used car in Canada, each with their own pros and cons. Here are some closing tips to recap the main points covered:

 

  • If you have enough cash saved, paying in full upfront can get you the best deal since you have negotiating power and avoid financing charges.
  • Car loans tend to have lower interest rates than other financing options, but shop around to compare rates.
  • Dealer financing can be convenient but read the fine print for any extra fees or charges.
  • Leasing has lower monthly payments but you don’t own the car and have mileage restrictions.
  • Using a credit card allows you to earn rewards but can lead to high interest charges.
  • Always negotiate the price of the car first before discussing financing terms.
  • Calculate the total cost including interest so you can compare financing options.
  • Make payments on time and pay extra when possible to pay off your loan faster and reduce interest paid.

 

By weighing all your options and negotiating the best deal, you can find the ideal payment method to buy your used car. Do your research and crunch the numbers to make an informed decision. With the right preparation, you can pay for your used car purchase in Canada with confidence.

 

Conclusion

Buying a used car is a big financial decision that requires careful consideration of the various payment options. By weighing the pros and cons of paying cash, getting financing, leasing, or using a credit card, you can determine the best method for your needs and budget.

Be sure to calculate the total cost of any loan or lease, and negotiate the best possible deal. Shop interest rates from multiple lenders, and read all terms carefully before signing anything.

Once you’ve chosen a payment method, focus on paying off your loan as fast as possible to save on interest charges. Make extra principal payments, pay biweekly, or refinance for a lower rate.

Owning a used car lets you get reliable transportation without the high cost of buying new. Take your time, do your research, and use this guide to pay for your used car in the smartest way possible.

 

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Questions About Paying For a Used Car

**Paying with cash or certified cheque is often the best way to pay for a used car in Canada. This guarantees the seller receives payment and there are no financing fees. However, taking out an auto loan through your bank may allow you to pay over time.**

 

You have several options when paying for a used car in Canada:

 

– **Cash or certified cheque** – Paying the full amount upfront with cash or a certified cheque is a secure method. It guarantees the seller receives the payment, and there are no financing fees. Make sure to get a valid receipt.

 

– **Bank draft** – A bank draft for the full amount works similarly to a certified cheque. It cannot bounce and guarantees your payment to the seller. Bank drafts can cost $7-$15 depending on your bank.

 

– **Personal cheque** – Paying with a personal cheque is riskier for private sellers. It could take days to clear or potentially bounce. Most sellers will not accept a personal cheque.

 

– **Auto loan** – If you don’t have the cash upfront, you can finance your used car purchase through a bank auto loan. This allows you to pay over several years, but interest charges apply. Shop rates from several banks and credit unions. A down payment is usually required.

 

– **Line of credit** – If you have available room in a line of credit, you can use this to pay for your used car. Interest rates are usually lower than credit cards. Make payments over time to pay it down.

 

– **Credit card** – While not ideal, paying for a used car with a credit card is possible. Interest rates are higher, so make sure to pay it off quickly. Transaction fees may also apply.

Paying cash for a used car means you own it outright with no financing charges. However, by financing you can pay over several years and potentially invest your cash instead. Weigh the pros and cons of each option.

 

**Benefits of paying cash:**

 

– No interest charges to pay

– You own the car outright

– Less paperwork and faster process

– More negotiation leverage on price

 

**Benefits of financing:**

 

– Pay over several years

– Keep cash free for other uses

– Potentially build credit with on-time payments

– Lower upfront costs

 

Determine how much you can afford upfront in cash, and compare potential financing rates and terms from lenders. Crunch the numbers to see which option saves you more money in interest charges over the long run.

When buying a used car in Canada, expect to pay tax on the vehicle purchase price along with potential documentation and licensing fees. Additional fees may apply for private sale vs. dealership purchases.

 

**Typical fees and taxes include:**

 

– **Provincial Sales Tax (PST)** – Charged on the vehicle purchase price. Rates vary by province from 0% in Alberta to 15% in parts of Atlantic Canada. Tax is payable on private and dealership sale prices.

 

– **Federal Goods and Services Tax (GST)** – The GST rate is 5% country-wide on used vehicles sold by a business. Private sales are exempt.

 

– **Documentation fee** – Dealerships typically charge $100-$500 to cover paperwork processing. Private sales do not have this fee.

 

– **Licensing and registration** – These fees paid to the province generally range from $30-$120 annually depending on the province and vehicle type.

 

– **Safety certification** – If buying privately, you may need to pay for a safety inspection certificate done by a mechanic, which can cost around $100-$150. These are typically included from dealers.

 

Make sure to factor in all these fees and taxes when budgeting for your used car purchase. The final bill may be several hundred dollars higher than just the vehicle’s sale price.



When paying cash for a used car, make sure proper paperwork is signed by both buyer and seller to record the sale and transfer ownership officially. Essential documents include:

 

– **Bill of sale** – Outlines vehicle details, sale price, conditions, and buyer/seller information. Both parties sign to record the transaction.

 

– **Vehicle ownership** – The back of the vehicle’s ownership certificate should be signed by the seller to transfer it to the buyer.

 

– **Safety standards certificate** – If purchased privately, have the seller provide the valid certificate issued by a mechanic.

 

– **Usage history** – Ask the seller to provide maintenance records and any accident history details they have.

 

– **Receipt for payment** – Have the seller sign a receipt document stating you paid the agreed sale price. Include payment details like cash or certified cheque number.

 

Make sure all details like VIN number, odometer reading, sale date, names, etc. are filled in correctly. Submit copies of paperwork to the provincial motor vehicle department right away to officially transfer ownership to you with proper registration.

Used car loan interest rates from Canadian lenders generally range from 4% to 9% for buyers with good credit (scores above 680). The higher your credit score, the better rate you can qualify for.

 

**Typical used auto loan rates by credit tier:**

 

– **Exceptional credit (800+):** 4% – 5%

 

– **Very good (740-799):** 4.5% – 6%

 

– **Good (680-739):** 5% – 7%

 

– **Average (620-679):** 6%- 9%

 

The make/model of vehicle, loan term length (e.g. 36 vs. 60 months), down payment, and lender also impact rates offered. Banks usually have the lowest rates while dealership financing runs higher.

 

Getting pre-approved by your bank before shopping can give you bargaining power to negotiate the best used car price knowing what rates you qualify for. Check with multiple lenders to compare loan offers. Reducing your purchase price even by a few hundred dollars will save significantly on interest charges over the loan’s duration.



When applying for financing from a bank or other lender to pay for a used vehicle, have these documents ready to support your application:

 

– **Driver’s license** – Photo ID proves your identity and address.

 

– **Proof of income** – Recent pay stubs or tax returns showing your earnings.

 

– **Bank statements** – Provides insight into your spending habits.

 

– **List of assets** – Details on things you own that provide financial stability e.g. home, investments.

 

– **List of debts** – Including credit cards, loans, mortgages, showing monthly balances and payments.

 

– **Down payment** – Having 5-20% of the vehicle purchase price can lower your interest rate.

 

– **Vehicle details** – Information on the used car’s year, make, model, mileage etc.

 

Allow 1-2 weeks for loan application processing. Ensure all details submitted are accurate. Maintaining good credit history and secure income sources will qualify you for the best loan rates.



Yes, getting pre-approved for an auto loan before visiting dealer showrooms is highly recommended. Pre-approval locks in an interest rate and loan amount you qualify for based on your credit and income proof.

 

**Benefits of getting pre-approved:**

 

– Know your budget limit for shopping

– Gives you negotiation leverage on vehicle price

– Streamlines purchasing process at the dealership

– Saves multiple hard credit check impacts

– Locks in the rate even if rates rise later

 

Having a pre-approval essentially guarantees financing, allowing you to focus just on negotiating the best used car. Dealers will often try “shotgun” approaching banks to see who offers you the lowest rate, which actually hurts your credit score with each check. Avoid this by having a rate already secured.

Used car loan terms typically range from 24 to 84 months in Canada. Longer terms have lower monthly payments but higher total interest costs. Aim for the shortest term you can afford based on the monthly payment.

 

**Common auto loan term lengths:**

 

– 24 months

– 36 months

– 48 months

– 60 months

– 72 months

– 84 months

 

Sticking to a 36 or 48 month loan is recommended to save on interest and pay off your car sooner. Only consider extended terms above 60 months if absolutely needed to get an affordable payment on an expensive vehicle. Avoid ultra long 84 month terms which cost far more in interest.

 

Shop multiple lenders to compare rates for various terms. Consider paying more per month on a shorter 36 month loan vs. lower payments stretched over 6-7 years costing thousands more in interest. Crunch the numbers to find the best auto loan term for your budget.

Trading in your current used car can help lower the purchase price of your next used car from a dealership. The dealer will assess your old car’s value and deduct this “trade-in value” from the price of the new car you want.

 

**Here’s how trade-ins work:**

 

  1. Get your car appraised – Dealers will assess your car’s model, age, mileage and condition to estimate its wholesale value.

 

  1. Negotiate your trade-in value – Research car values beforehand so you can negotiate to maximize your trade-in credit.

 

  1. Apply credit towards new purchase – The appraised trade-in value gets deducted from the price of the car you’re buying.

 

  1. Settle remaining loan balance – If you still owe money on your trade-in, the dealer will pay off your old car loan using the trade-in credit.

 

Trading in can be convenient but you typically lose out on hundreds vs. selling privately. Weigh your options to decide what works best. Dealers make profit on reselling your old car.

For private used car purchases, cash or interac e-transfer are the recommended payment methods as they are direct and guaranteed funds. Avoid cheques or credit cards with private sellers due to higher risk.

 

**Secure payment options for private purchases include:**

 

– **Cash** – Count cash in front of seller. Get a signed receipt confirming payment amount.

 

– **Certified cheque** – Funds are guaranteed once issued and cleared by your bank. Certified cheques cost about $10.

 

– **Electronic bank transfer** – Interac e-transfer directly from your bank account to the seller’s is simple and secure. Transactions are typically limited to $3,000 per transfer.

 

– **Wire transfer** – Wiring larger amounts directly to the seller’s account is also safe but fees apply.

 

– **Bank draft** – Draft funds come directly from your account like a certified cheque. Bank drafts cost around $7-$15.

 

Always thoroughly test drive the vehicle and verify ownership before finalizing payment. For security meet sellers at your bank to pay in cash or certified cheque in front of staff.



When buying a used car, especially privately, it is critical to uncover any past accident damage which could indicate ongoing issues. Here are tips to detect used cars previously in collisions:

 

– **Get a CARFAX vehicle history report** – $20-$25 to see reported accident details, mileage, registrations etc.

 

– **Inspect paint finish** – Look for overspray, mismatched panels, fading differences indicating paint repairs after a crash.

 

– **Check body panel gaps** – Bad alignments, uneven gaps can signify panels replaced after collision damage.

 

– **Look inside trunk/interior** – Misaligned trim, replacement handles, loose carpets can hint at crash repairs.

 

– **Test drive handling** – Pulling, vibrations, steering/brake issues may indicate crash repairs missed something.

 

– **Feel for bumps under carriage** – Get on a lift or crawl underneath; collision repairs can often miss things underneath.

 

While not definitive, combining a vehicle history report with a thorough inspection and test drive can help detect used cars previously in accidents so you avoid inheriting someone else’s repair headaches down the road. Consider getting any suspicious vehicles checked over by your mechanic before finalizing a purchase.

For private party used car purchases, a bank draft or electronic transfer are the recommended payment methods, as they offer both security and proof of payment made.

 

**Why these are the best payment options:**

 

– **Bank draft** – Funds come directly from your account like a certified cheque, guaranteed to clear. Provides payment proof. Typically costs about $7-$15 to get a draft made for the agreed amount.

 

– **Interac e-transfer** – Securely sends money electronically from your bank account directly to the seller’s account. Provides transfer records. Money is deposited and available quickly. Daily limits apply.

 

– **Cash** – Cash in smaller amounts is fine too but get a signed receipt from the seller showing amount paid in full. Also, carrying large cash sums has risks.

 

Avoid cheques or credit cards for private sales. Personal cheques can bounce, and credit cards offer no payment protection to sellers. For security meet at your bank to pay in-person with a bank draft. This provides you both validation of funds transferred.

Buying from private sellers or dealers, it’s important to negotiate firmly and understand used vehicle valuations, so you don’t overpay. Here are some tips:

 

– **Research market value prices** – Consult Black Book, Canadian Red Book, CarProof and online ads to compare fair value for the specific year, make and model. Consider mileage, condition and options.

 

– **Get quotes from multiple dealers** – Reaching out to several dealers by email or phone with the exact vehicle specs you want allows you to leverage their best price offers against each other during negotiations.

 

– **Come prepared to walk away** – Being fully ready to walk out gives you more leverage in price talks. Remember, there are always other vehicles for sale another day.

 

– **Ask about wiggle room** – Straight up ask the seller if the listed price has any flexibility or wiggle room for negotiations. See if they’ll come down in price to make the sale.

 

– **Offer below asking price** – Start negotiations below asking price, even on online ads. Many sellers price higher, expecting offers. Offer 10-15% below list price to start negotiations.



When purchasing a used car from an individual private seller rather than a licensed dealer, there is no warranty coverage provided. All vehicle sales are “as-is” when private party. Any car issues that arise post-purchase are the responsibility of the buyer.

 

This means if repairs or problems show up shortly after your private party used car purchase, you cannot make any warranty claims. Neither the seller nor the vehicle manufacturer is obligated to cover any future repair costs or deficiencies.

 

For this reason, getting any private sale used car thoroughly inspected by your own mechanic beforehand is strongly recommended. Additionally, only buy privately from original owners who have maintenance records available, so you can confirm a vehicle’s service history upfront.

 

Overall the lack of any warranty coverage is the key risk you accept buying a used car from an individual. Weigh the potential savings against future repair bills being all your responsibility as the buyer.

If purchasing your used car from an authorized dealership, expect the following typical process:

 

  1. **Test Drives** – Take vehicles of interest for thorough test drives checking all functions.

 

  1. **Price Quotes** – Get quotes for desired vehicles in writing (email) to compare total pricing after tax/fees.

 

  1. **Negotiations** – Discuss pricing offers further with sales representatives once you’ve narrowed down top choices.

 

  1. **Financing Pre-approval** – If financing, secure loan pre-approval from your bank in advance with rate/terms.

 

  1. **Paperwork** – Provide documents needed for purchase agreements, registration paperwork etc.

 

  1. **Inspection** – Have your preferred mechanic do a pre-purchase inspection before finalizing.

 

  1. **Delivery** – Once purchased, your detailed and cleaned car is ready for you to pick up and drive home!

 

Shopping at reputable dealerships provides integrated processes from test drives to financing so you can purchase with confidence once you negotiate an agreement on pricing.

To ensure the used car you’re considering buying has not been stolen or written off as salvage, you’ll want to investigate its vehicle history thoroughly. Here are key steps to vet out stolen or rebuilt cars:

 

– Run a CARFAX or CarProof report – $20-$25 to uncover accident/damage records, mileage inconsistencies, state registrations.

 

– Check the VIN plate – Verify the VIN plate on the dash and door sticker match the ownership certificate number exactly. Mismatches can flag stolen vehicles with replaced VIN plates.

 

– Review ownership certificate – Check the certificate does not state “salvage” indicating a total loss. Ensure it has not been recently switched owners several times quickly.

 

– Inspect for replacement parts – Many interior trim pieces, handles and mirrors can be changed on stolen cars and may not match if replaced poorly.

 

Getting a vehicle history report along with checking over VIN plates, paperwork and component matches will help avoid buying a potentially stolen or rebuilt used car. Consider having your mechanic inspect as well before finalizing a purchase.

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