Buying a new car is exciting—and often overwhelming. Particularly if it’s a used car, you don’t want to make any of the common errors. A little research can go a long way not just in finding the right car for the right price, but being aware of what you’ll need to do in the future to protect your investment. Cars can be investments if chosen wisely and cared for well. Ultimately, you’d like to be able to sell or trade-in this vehicle at some point for a small profit. Here’s what you need to know before you buy that seemingly perfect used car:
Does it have a diminished value claim?
Many cars have been in accidents that didn’t total them—but that doesn’t mean the collision didn’t diminish its value. Any time a car has been in an accident, the value of the vehicle is diminished. Unbiased third-party reports, such as CarFax, will tell you whether or not the vehicle has been in any accidents. It’s well worth it to run your own report to make sure the seller isn’t trying to hide anything. This doesn’t mean you shouldn’t buy a car that’s been in an accident, but you should consider how much value loss the car experienced and what the correct price should be.
What are the maintenance requirements?
Every vehicle make and model will have different requirements, and these prices can be quite high for some foreign models, sports cars, or rare vehicles. Does that mean you shouldn’t buy the classic car of your dreams? Not necessarily, but it does mean you should factor in higher maintenance costs to the annual costs related to owning the vehicle. If you’re handy and want to work on the car yourself, that can certainly save you money but might eat up a lot of your time. Be honest when assessing the real cost of maintenance.
Is it a flood car?
Unlike accidents, are a different kind of damage. There are always a “flood” of cars that come to the market after hurricanes and other flooding events. Again, a third-party report will tell you whether a car has been flooded and usually these vehicles should be avoided. The hidden damage risks are simply too high.
Is the mileage appropriate for the year?
Take a look at the year of the vehicle and it has. An average number is 10,000 per year. If the vehicle you’re considering is substantially higher, that’s a red flag. Wear and tear can mean increased maintenance costs.
What will the insurance be?
Insurance rates can vary dramatically based on the make, model, year, and miles of the car. Before making a purchase, check with your insurance agency—and use this opportunity to shop around for different plans. The cost of the insurance alone can be a deciding factor when it comes to choosing the right vehicle for you. Sports cars come with notoriously high premiums.
Shopping for a used car means double-checking the facts yourself. It’s great if you can find a late-model vehicle that still offers some warranties because then you’re getting some perks of a new car without the outlandish prices. Used cars can be a great way to save money, but not at the expense of your safety or high insurance premiums. If a used car is in your future, do your best to test drive it in person. It’s easier than ever to shop online for just about anything, but doing so is risky and you might be in for an unwelcome surprise.