Buying Used Without No Clues

July 28, 2009 1:44 PM

I'm generally freaking out about buying a car (used, my first) and have a short laundry list of very general questions.

My wife and I need a car. Before winter definitely, but within 2-3 weeks for some convenience reasons would be good. She's coming back visiting her folks this weekend, and the hunt begins in earnest, after a few forays to a few places, next week.

Here's what we've settled on so far:

99% sure we're getting a used Toyota, Hyunda or Honda. Reliable, get good reviews in the slightly-old copy of Phil Edmonstun's Lemon-Aid guide my dad lent me, more expensive than American brands but we're not so keen on buying American these days.

My wife wants a 2005 or newer. I'm not sure why but I think she's afraid that I, being a skinflint, will insist on a rustbucket if she doesn't set out some parameters. From what I can see, the biggest price drop is from zero to two years old, so that actually plays well into my penny-pinching ways... if a 2-year-old car costs 75% of original retail and a 5-year-old costs 60%, the most "value" is in the 2-year-old.

Here's the thing: I know bupkis about cars; under pressure I think I'm pretty sure the red ones go faster. I'm exaggerating -- I spent one summer in high school working at a gas station, so I've checked oil before and stuff -- but I'm in no way qualified to gauge the worth of a used car. I've never owned one, and I'm downhill of mid-30s; hers have always been hand-me-downs so she's never been car shopping.

We'll also be doing all of this in my second language, French, which my wife doesn't speak at all. While I speak pretty good business French and decent conversational French, "car French" is not in my comfort zone.

We have a fair-sized down payment, as we've agreed that it makes more sense to dump our savings on the car than to pay interest on the thing, as interest earned on this money would not outpace interest charged on a car loan. Our budget is $8-10K. We can stretch that up a bit if necessary. Assume we can pay 50% or so of a car in the $8-10K price range.

We intend to drive around town for the most part, maybe the 30 km trip to visit friends in neighouring places once every couple of weeks, and a 400 km round trip to Montreal once a month.

So here, at last, are the questions:

Is "dealer used" a better idea than "used-car-dealer used" or "classifieds in the paper" used? I have the vague idea that the Toyota used lot, affiliated with the Toyota new lot, will offer better vehicles that are more expensive than "regular" used-car dealers, which will be slightly cheaper, and the classified-ad cars will be cheapest of all but highly risky. Is that a fair assumption?

Can I trust a used car salesman? I'm aware of the stereotype, but I'm also of the belief that most people are generally good, and it's a reputation-driven industry. Assuming the guy isn't wearing a porkpie hat, chomping a stogie and telling me this was only driven by an old lady on Sundays as he fiddles the odometer with a grimy screwdriver, is flat-out asking a used dealer for advice a good idea, or begging to be taken to the cleaners?

If a car is nearing the end of its warranty (say 90,000 out of 100,000 km), what does that... er... mean? Are warranties super good? Kinda good? Is there a way to gauge how much a remaining warranty adds to the value of the car?

Is it better to buy an old car with low mileage or a new car with high mileage? This thread dances around that same question, but winds up being a series of recommendations to check prior maintenance. Which is excellent, but I still need to know -- maintenance done, is a 2007 car with 120,000 km on it better or worse than a 2005 car with 80,000 km on it, assuming price is similar*?

If buying used, is there a huge advantage in buying local? It would be much, much cheaper to shop around in Montreal than here, but that's a two-hour drive away. How important is it to be able to revisit the dealer you bought the car from, barring some sort of catastrophic failure in the first couple of weeks?

Given that we'll be able to supply a sizable down payment, will that put us in a better position to negotiate the financing rate? Most places around here seem to ballpark at 2.9%, which ain't terrible, but I wouldn't mind knocking that down a bit if I could.

Last and most important: I'm feeling overwhelmed, like I don't have enough knowledge to evaluate or to negotiate. Part of me says "dude, people buy cars all the time but the much larger part of me says "dude, don't be stupid with $10,000." How in God's name do I calm myself down over this?

This, by the way, is the local Toyota dealer.

This is Honda.

And this is Hyundai.

For comparison, this is the used-car section of the most popular (by a wide margin) classifieds site in the province, sorted for my area.

*I pulled those years and mileages out of my butt. I'm looking for more of a general answer.

posted by Shepherd to travel & transportation (19 comments total)

This doesn't really answer your question(s) - but my husband and I feel about the same way you do about purchasing a vehicle. It's scary, overwhelming and we really know little about cars and therefore do not feel qualified to purchase a used vehicle.

And this is why the past few cars we've purchased have been new. I feel like, although they aren't as financially smart to buy as say a 2 year-old car, purchasing new really equated to purchasing peace of mind for us.

However, that said, our vehicles are starting to get old and we know one of these days we'll have to buy another. I think we would consider buying a pre-owned vehicle. BUT, for some reason, I feel less confident about purchasing a used vehicle from an ordinary person than from let's say a dealership that has a section of pre-owned vehicles with warranties attached.
posted by Sassyfras at 2:01 PM on July 28

I know very little about cars. I have though a Subaru that I have had for 15 years and has some 125,000 miles on it. Not a great car, ever, but reliable and cheap (when I bought it. Can not say about prices now.)

Best advice (without talking money or year): I think Honda has the best record for reliability, low cost of repeairs...Toyota close to it but not number one.
posted by Postroad at 2:10 PM on July 28

I understand your trepidation in buying your first car. I went through the same thing. I ended up buying a '92 Corolla from a somewhat sketchy-seeming used car dealer who struck me as the kind of guy who might be a fence for the mafia. Having said that, the car was AWESOME. Hands down the best car I've ever owned. I sold the thing 2 years ago at 200,000 miles and the new owner says it's still going.

I got a fair deal for it, I think; I paid around $8600 for it at 43k in '95. What I'm trying to say is, it's all about the car. You just need to find the right car, and then do your research and offer the dealer, whoever he is, the right price. Check to make sure that the car hasn't been in an accident (this is very important). You can do this by getting the vehicle's VIN number and checking it's history online. A dealer might have a better collection of cars, but he also might be in a situation where he can try and sell you a bunch of extras that you don't need/don't want to pay for.

Do all the research you need to do, check the Kelly Blue Book value for the car, etc. Decide what you think is fair, and then go into the dealership and talk to the guy. If you're feeling uncomfortable, or if you feel pressure because the salesman's giving you the hard sell, you can always walk out. The salesman has no power once you walk off the lot. And you can empower yourself a lot by doing some research.

You can do this! And when you do, it will be great.
posted by cleverevans at 2:16 PM on July 28

my usual advice to myself is this: you cannot trust anything that comes out of anyone's mouth regarding an item you are about to purchase from them. you must let the vehicle do the talking. if you know what to look for, all the evidence you need will be in front of you. if you don't an independent mechanic will.

years ago, i bought an '87 pathfinder privately. the guy said a bunch of buyers were anxious to get it. i decided i wanted it and went to get the money. when i returned, i asked him about the other buyers. he said they'd been there and wanted the vehicle, too. his boy (about 3) yelled out, "what people, daddy? i didn't see any people!"

i bought the vehicle anyway, because even though he was a lying sack of shit, the transaction was legit and the car was a good deal. i drove it until it had over 400,000km, and now my parents have it.

i have a second rule that goes like this: never buy used from a dealer. however, if the dealer is a major brand dealer, and they're offering a warrantee, that might offset the premium you'll pay.
posted by klanawa at 2:28 PM on July 28

Don't throw Nissan off the list, it is most certainly in the crowd you are looking at.

Think about the mileage and the model year both on their own and in conjunction. The miles/yr is a reasonable way to think about how the car was actually driven.

If you are thinking about buying it, take it to a mechanic and pay them as much as $150 to give it the once over and determine what if anything is out of inspection or in need of immediate repair.

Check the Kelley Blue Book to determine a baseline price ballpark for each car you look seriously at.

Don't take any financing from the car dealer (you can almost certainly get better if you go elsewhere).

If you go with the classifieds route, stop in to a handful of them just to check them out with no intent whatsoever to buy. This will make you a little more comfortable with the back and forth of it before you have to really negotiate on something.

Mostly, just don't be scared, it is your money and you can always keep it and not buy the one car that someone happens to be pushing on you. If you remember that you can always just walk away, it gets a lot less scary.

Good luck!
posted by milqman at 2:29 PM on July 28

I'm in no way qualified to gauge the worth of a used car.
The best used cars available are ones that are "Certified Pre Owned." They've been well inspected, well maintained, and are low mileage vehicles. They also come with a manufacturer's warranty. For instance, Honda's CPO warranty will cover the car up to 100,000 miles. A CPO car will generally cost more than a comparable private party or used car lot vehicle, but (in my experience as someone who certifies cars at a dealer) we do a pretty thorough job of reconditioning these cars. In my case, our standards are strict since the manufacturer realizes that a CPO vehicle is likely to be someones introduction to the brand and they want to make a good first impression. A CPO car will also usually have the most up-to-date services, recalls, or updates performed on it as part of the reconditioning process.
When buying a used car, you'll have to drive it and be able to discern if the steering and ride feels right, if it pulls, and if the smells and sounds of the car are correct. You'll have to be able to examine the exterior and be able to tell from touch and sight if it's been repainted. You'll have to be able to look past the shiny ArmorAll to the real car underneath. When buying a CPO car, that's already been done by a certified technician who signs all of the paperwork and stands by their description of the vehicle as a "good CPO candidate." If I certify a car and a potential buyer or a salesman discovers a faul with the vehicle that would disqualify its certification, that falls back on me. To give you an idea of how strict we are (at Audi, at least), I can deny certification if, in my opinion based on the service history, the car has been in the shop too often.
And the warranty will absolutely pay for itself, considering the price difference between "used" and CPO.

Can I trust a used car salesman?
They're a salesman first, in my experience. They're typically in no way a car expert, technically savvy, or even aware of the functions of the features on the car they're selling. Their job is to make money by selling you a car. When buying a car from ANYBODY it's up to YOU AND ONLY YOU to be an expert on what you're trying to buy. Consumer Reports is your absolute best friend when it comes to this.

Is "dealer used" a better idea than "used-car-dealer used" or "classifieds in the paper" used?
Yes. Based on my interactions and experiences, a non-brand "used-car-dealer" lot (except CarMax) operates on a superslim overhead and would rather bandaid a car to get it sold than actually fix it. Their warranties aren't very good and they don't typically have highly skilled and trained technicians to address your concerns.
Classified ads have good deals if you really know what you're looking for and know how to evaluate a car.

I'm feeling overwhelmed, like I don't have enough knowledge to evaluate or to negotiate.
Don't worry! At the end of the day, no matter what you pay, the dealership will make a proft and you will drive away with a car. Don't put such a huge emphasis on "getting a deal." Just be aware of how much you're willing to pay for a certain car and try to get as close to that as possible. If you feel like it's too much, look for something else or visit a different dealer. Take you time with a decision. The best thing to do is call all of the Honda/Toyota/Hyundai dealerships in your area, tell them what you want and how much you'll pay for it. Wait about three weeks and someone will call you with the car you're looking for. There's always a salesman who'll want to earn your business. Just remember, they're trying to make X number of sales every month. As long as you can be patient, someone will come around. When I bought a brand new car a few years ago, that's the tactic that I used. I knew what the rock-bottom invoice price was, I knew what features I wanted, and I knew what color I wanted. I made a few visits, took a few test drives in similar cars and called every dealership within 60 miles. The second to last day of the month, a dealership called me and told me that they had traded a car off their lot to get mine. They're more desperate to sell the car than you are to buy it, if you can just be patient.
posted by Jon-o at 2:31 PM on July 28 [2 favorites]

The Consumerist has some great, ultra-paranoid stuff under their "used-car" tag. Read it and learn how to be a horrible, stubborn prick when dealing with salesman. I figure that these guys are good enough that you'll never be able to tell whether they're genuinely nice or just working you. Assume the latter and give them hell regardless.

Also, if relliability is your primary concernt, there is no reason to buy anything other than a Honda or Toyota. They will save you so much money in repair costs and resale vaule that the "cheaper" Hyundai will be nothing of the sort two years down the road.
posted by martens at 2:46 PM on July 28

Tempting as it might be to avoid a pre-purchase inspection by a mechanic--get one, even if the car's a couple years old.
posted by ambient2 at 2:53 PM on July 28 [3 favorites]

One thing I learned in the process of buying my first car when I was young and dumb: get your financing BEFORE you go to the dealer. Do NOT finance via the dealership. Your local credit union is usually going to be your best bet.
posted by rabbitrabbit at 2:54 PM on July 28 [1 favorite]

definitely get the car checked out by a professional before you buy it. a mechanic at some chain place (who i had never seen before, not like my personal mechanic) told me about a pretty major problem with a used corolla i was on the verge of buying. and then i kept looking and found a kia that is a great car. so it was worth the $100 i paid him. i also got financing through my credit union at a much better rate than the dealer was offering, and without a penalty for paying it off early.

you really can't trust the salespeople, unfortunately. if they have any doubts about the car they will not ever share them with you, because then you might not buy the car, and they lose a sale. there are bad used cars, even toyotas and hondas, that's why the having them checked out step is so important.
posted by katieanne at 2:55 PM on July 28

Why not consider a (new) Honda Fit? Not too expensive, can carry lots of stuff, comes with a warranty, and is even fun-to-drive. You can finance longer-term and you'll probably get a much better resale value 4 years from now than anything you buy used. I just can't think of anything that provides a better value-to-cost ratio.
posted by everythings_interrelated at 3:10 PM on July 28 [1 favorite]

Re: the language thing -- can you enlist a friend whose car-French is more fluent than yours to help you be sure you are understanding fully and making yourself clearly understood?
posted by jaruwaan at 4:21 PM on July 28

There are always exceptions - the fabulous Pinto that runs like a champ, the worthless Honda that's a lemon - and the exceptions produce vociferous partisans. Ignore them. Go after statistics from reasonably competent and objective sources - f.ex. Consumer Reports.

Basic facts: differences between car brands in reliability are there, but not huge statistically speaking. And cars of recent vintage have gotten pretty reliable. So, if brand A is twice as reliable as brand B - it still may not mean much, if the stats are 1 problem per 1000 vehicles, vs 2 problems per 1000 vehicles. That caveat out of the way, there are still very good reasons to pick one brand versus another - and quite apart from comfort and what you need the car for, and apart from aesthetics and even mileage. And that's how expensive and difficult it is to fix the car - and almost every car needs some kind of fixing at some point. Example: let's say you go for brand A which is twice as reliable as brand B. But brand A is a fairly exotic foreign car - and so there are not many independent mechanics who work on this car, and you're stuck with the thieving dealer (if indeed the dealer is bad), and worse, parts are super expensive, and it's very expensive to fix even simple things and do basic maintenance. So it actually makes sense to buy brand B, because you'll come out way ahead even with worse reliability.

Brands. Keeping in mind the above basic facts, the reliability of your choices goes from Honda (best) and Toyota (close, but very good), to Hyundai (reasonable reliability starting in 2004 for the Elantra specifically, and 2006 other models). Honda and Toyota also have tons of independent mechanics, and parts are reasonably cheap. Hyundai is much worse as far as mechanics specializing, but reasonably cheap parts. Value: yes, Hondas are the most reliable, but are way overpriced (used) for the reliability advantage compared to Toyotas - on the other hand, excellent resale value. Hyundai are undervalued (used) compared to their reliability disadvantage, but miserable resale value (though that's slowly changing for recent models starting 2006 or so).

Price. Look at edmunds.com for "true market value", input your choices and zip code. This is a decent ballpark figure. As a buyer you are in a stronger position in today's economy compared to sellers. That goes double for dealers. You are in a power position. Don't brandish it like a blunt weapon, but be quietly aware of your power. YOU are in the driver's seat. Have a max price in mind, after you've priced the local market and looked at edmunds.com true value. AND STICK TO IT. Get your car for less, but never for more - especially in this market.

Dealers - ignore whatever comes out of their mouths - I treat their statements as funny noises slipping out from between two wrestling worms (their lips). Not that all are crooks, and not that all are ignorant, and not that all are out to hustle you. But you are almost never in a position to tell when that is the case. So why try to do the impossible - read their minds? Ignore their statements.

You'll get some kind of limited warranty. You should still have a mechanic check out the car. And you might want to take a friend along, who knows a bit about cars. Check out the VIN, but it's not 100% reliable and can give you a false sense of security.

Before you even get so far as a mechanic, perform a basic inspection. Look to see if the car's hood is aligned (space between hood and the rest of the body is even - equal spaces on both sides), and same for the trunk lid - if not, it might mean the car was in a serious accident. Same for spaces around all the doors. Are the tires on one side of the car more worn? Is there an unusual pattern to the wear? The car might be pulling to one side or the frame is misaligned after an accident. Are any of the body panels of a slightly different shade, or otherwise look newer? Might have been replaced after an accident. Is there an unusual smell inside of the car, especially a musty smell? Might have been flooded - avoid. Is there a dried sign of a water-line inside at a height of a few inches off the floor? Flooded. Take a napkin and swab the inside of the exhaust pipe - does it burn oil? Open the engine hood - look up at the underside of the hood - do you see signs of a burn or smoke deposits? Might have blown a gasket or had an engine fire. How does the engine look? All sprayed with old oil deposits? How do the hoses look - are they old and cracked? Check the oil - is it filthy and low? Check the transmission fluid - is it dirty? Are there metallic specs floating in it? If yes, immediately step away from that car - the transmission might be on its last leg. Look under the car - is anything leaking?

Drive the car. Pay particular attention to how it starts. Check all the lights and electrical functions - electrical issues can be a bitch and expensive to diagnose and fix. Try out all the speeds in the transmission - does it hesitate? Does it jump when it changes speed? Does it slip? How is the reverse? Transmissions can be very hard and frankly uneconomic to diagnose (opening up can cost a fortune) - so the least issues with the transmission, and you should walk away. Engine - does it whine, hesitate, choke?

Don't discount how it looks inside and outside - people who don't care about their car, frequently don't maintain it properly. If it's trashed - avoid. Also avoid modded cars - they might have been raced (applies especially to certain models of Hondas). A newer car (2005 and newer) that's been repainted - very suspicious.

In general, since you are looking at newer cars (I think you should allow the 2004 models as well), it is the mileage that matters more. I'd sooner take a one-two year older car, but with 10K-20K fewer miles. In such recent vintage, it is all about miles, miles, miles. Wear = tear, and you can only ameliorate it, but never eliminate with proper maintenance - and you never know how well maintained a car has been... go for the lower miles!

Now, once you've selected your car, take it to a mechanic. Pay the $100-$150 for a thorough inspection - ask him to hook up his computer and retrieve any codes that might be stored in your car's computer - that will tell you if there were any major problems and what the codes were. Have him generate a thorough list of all things that need to be worked on, or are flawed - including what he'd charge to fix all the issues. If there are serious problems, of course, look for another car. But even if there are only maintenance issues (new brakes, new hoses, tires, bulb replacements etc.) - you can present that list as a negotiating point to the dealer... either have them drop the price some or fix some of the stuff for free.

If you do buy it - keep a sharp eye and a running list of issues during the warranty time, and take advantage of the warranty before it expires.

And fear not - there are millions and millions of cars out there. There's easily one that's just perfect for you.

Good luck!
posted by VikingSword at 4:28 PM on July 28 [2 favorites]

Sign up for Consumer Reports for a couple of months and look up any models you are interested in. I did and I don't regret it.
posted by IndigoRain at 4:38 PM on July 28

One piece of advice if you're buying used and from a dealer: get a "certified" car. I've had a certified Honda Civic for 10 years and have had just maintenance like 30k, 60k, 90k services and regular oil changes.
posted by bunny hugger at 4:57 PM on July 28

We've gone every way-- new, dealer used, used car dealer, classifieds, lucked into one from our mechanic once. First car we bought was from the classifieds and it was a great little car. You'll have more trouble getting financing for using the classifieds, since you'll have to go to a bank rather than the dealer. As everyone says, do your homework on the model and always always always take the car to an independent mechanic for confirmation on condition, no matter how per-certified it is. Any dealer who won't let you do that is not to be trusted. Clearly you're not in the US if you have to do this in French, but if you have dealers where you are like Saturn or CarMax, where they don't pull the "let me go talk to my manager" garbage and make you sit there for 5 hours trying to buy a car, GO TO THAT DEALER. These places are fantastic. They will then pull that crap on you for financing but you don't have to put up with it. Once you find a car you tell them "I have to be out of here in one hour, and when that hour is up, get up and walk away. You can do this. There's always another car. Once you do this to them, they get the message and will not fuck with you. Regarding financing, check the math. Dealers will sometimes just add in shit that make the monthly payments go up. Once you know the price and the interest, check out what the monthly payment should be. If it's different than the one they are telling you, ask why. Some places try to add in expensive maintenance contracts that they then finance through the loan, adding to the cost for you (and the profit for them.)

Yes, buying in warranty is better, because some basic maintenance is covered, but it's not a reason to buy a particular car.

We have only ever bought 2 cars new; used is better for price reasons and because you'll be subject to less bullshit from the dealer. We always go for later model (less than 5 years old) and the lowest mileage we can find balanced against what we know we can pay. We once bought a car from our mechanic-- 12 year old chassis, 6 year old replaced engine with 65,000 miles on it, $5,000. Drove it into the ground (got another 125K out of her). We like to buy Saturns because they are amazing workhorse cars that never need maintenance and have wonderfully trained sales staff (or used to, who knows what will happen now.)
posted by nax at 4:32 AM on July 29

I have really simple advice: watch Wheeler Dealers. It's a show from the UK where every episode they buy, restore, and sell a car. While all of their cars are older than what you want, watching enough of them you get the hang of how to buy a good used car, what can go wrong with cars, what it takes to fix this stuff, and you get a look at the selling process.

Because a good used car is a complex thing, and it really comes down to how well it was taken care of prior, buying a car from an individual with a full service record is usually your best bet. However, large car dealers---like Toyota---will inspect every used car they buy, usually extremely throughly. I would stay away from used only lots, unless the car is still under the manufactures warranty.

As for general car design advice, learn to look at them in a more reductionist way: brake system, engine design, safety features, fit and finish, paint quality. Cars can be deceptively attractive on the surface but can be found to be hiding bad design in the particulars. The Toyota Corolla is a great example. A much loved car on this site, with great gas mileage and so on. But they have drum brakes on the rear. Drum! Like a car from the 70s would. I would assemble a list of desired design elements and attempt to evaluate every car with regard to it.

Also, Ford now has reliability on par with the Japanese.
posted by luckypozzo at 7:31 AM on July 29

No matter how trustworthy the dealer seems and even if the car is certified pre-owned, get the car inspected by at least one independent mechanic. I had my current station wagon inspected by two different mechanics before I bought it.

I thought I wanted to purchase another nice-looking certified pre-owned vehicle from the brand's dealer. The dealership discouraged me from taking the vehicle to a mechanic, emphasizing that it was certified. I took it to a trusted mechanic anyway and he found all sorts of problems that had been hidden. It turned out that the car had been in a serious wreck. The dealership apologized and I took my business elsewhere. The lesson I learned was always get the car you are considering independently inspected.
posted by val5a at 3:24 PM on July 29

Oh, and I second what rabbitrabbit said. If you can join a local credit union or talk to your bank about financing beforehand, do that. You will most likely receive a much better interest rate from a credit union than a dealership.
posted by val5a at 3:26 PM on July 29