Best Place to Buy a Used Car

[Rianne]

We are firm believers in the used car market. Are the online used car sites to be trusted? We would get it checked out by our mechanic. Also, local dealerships might have a good deal, but once purchased you're on your own unless there's a warranty.

We've never bought a used car, but think it's the smartest thing to do.

[samclem]

I was a committed used car buyer for most of my life, but have re-evaluated that position. I think it still makes sense if the car you want depreciates quickly, but if it doesn't (e.g. many Honda and Toyota models), and if you'll be keeping the car for a long time, buying new makes just as much sense. So, maybe do the numbers and see how much you are saving, over the time you'll have the car, and you may find it is a wash.

To your question: CarMax is the easiest place I know of to buy used. It is not the lowest price, but you can get your money back within 5 days, they have a limited warranty (30-60 days on some parts). And they sell extended service contracts if you want one. If the car you want is at another location, they'll move it to you (for a price). Usually lots of selection, so it can be a good place to see several models from different mfgrs, a good starting point. Certified used cars from a dealer have fairly low risk, but won't be the cheapest used cars.
The best deals are surely direct from private owners. But that is also the biggest hassle.

[Jerry1]

I bought my first used car in a looooong time this time around. I found the Carfax website to be a good resource. It seemed to attract the higher end cars. Probably not exactly the place to get the best price, but in looking for overall value, I thought I did well. The car I got was a 2 year old car coming off lease. It still had the factory warranty for 1 year or 16K miles (car had 2yr/20K on it and factory was 3yr/36). It was sitting on a dealer lot. As part of the negotiation, I added Certified Pre-Owned status to the car which increased the warranty to 4yr/48K.

In looking at new cars I think I saved about $6-$8K over new. With the warranty and the good shape that it is in, I'm hard pressed to see what I would have got for the extra money.

As for the best deal, it's hard to find, but my SIL used to buy cars and trade them in at the dealer when they were around 75K miles. I bought two of them from her for the price the dealer would have given her and ran them into the ground. Those were great deals. Unlike new, the used car market is more diverse. You can get a newer used car that isn't much different from a new car and as samclem indicates, may not be a lot better than new. There is also the more used car and the really used car. At this end of the spectrum, you are better off if you know a bit about cars or have a good mechanic that you trust and doesn't charge you too much. With mine, I'm under warranty for 2 years so the car will go to the dealer for awhile and then I'll switch over to a good shop in town. Without a warranty, you need that mechanic up front. However, I've found that today, most cars do very well up to 100K miles with just basic maintenance. In my area, that means having an oil change place and a tire store that handles tires, breaks and suspension parts. I handle the very basic things like wipers, filters and maybe the occasional light bulb. Good luck.

[braumeister]

Quote:

Originally Posted by samclem I think it still makes sense if the car you want depreciates quickly, but if it doesn't (e.g. many Honda and Toyota models), and if you'll be keeping the car for a long time, buying new makes just as much sense.

This was a surprise to me when I was looking for my current car, a Honda CR-V. The best price I could find locally for a one year old, low mileage one was only a few hundred dollars less than a new one. When you consider how slowly some models depreciate, it makes sense to buy new and enjoy it.

[RAE]

Quote:

Originally Posted by samclem The best deals are surely direct from private owners. But that is also the biggest hassle.

+1, I have bought some really nice used cars from private owners for prices well below what I could have got them for at any dealer. Yes, there is a bit of a hassle factor (sometimes), but to me it's usually worth it. I look at prices of used cars on the lots around here and there are basically no deals to be had.......everything is full-priced and then some.

[Totoro]

Out here it is sometimes even cheaper to buy a new car vs. a recently used one.

I think it is partly because too many people realized the poor value in buying new, which in turn depressed prices while pushing up the second handers. So it self-corrected.

It's also becoming harder to buy a 'lemon', so there is less risk.

[OldShooter]

Off topic: IMO all the arguments for slow depreciation, etc. are even stronger when you are talking about a one- to three-year old car of whatever ilk you like. You don't have to eat first-year depreciation in order to benefit from this argument.

On topic: Re used cars, earlier in life I bought mostly from private parties. Used cars on dealer lots are unknown quantities even to the dealer. I believe that buying from a private party, listening carefully, and asking the right questions I can reduce my risk. Still the due diligence with an inspection, etc.

As we have become more prosperous, I have bought a couple of used cars from dealers where the car has the manufacturer "certified" blessing. There are manufacturer-required conditions and inspections, then the dealer pays a fee to the manufacturer in order to get the blessing and an extended warranty. So the dealer is really accountable to the manufacturer for the condition of the car. This is a much bigger responsibility for them than simply telling some bozo customer that the car is in good condition.

Another option that we've used recently is to buy a new car that is one model-year old. This saves us the first-year depreciation at the cost of having a more limited choice of colors and options. With most manufacturers now showing dealer inventories on lline, finding these cars is fairly easy. It's not as cost effective as buying a "real" used car but as both our assets and our laziness increase, it becomes easier to rationalize.

For both certified and last-model-year, we are quite happy to search within a couple of hundred miles of home. We saved a few bucks on my wife's prior-model-year Mini Countryman because we had one spotted a couple of hours away and would have been quite happy to buy that one if the local dealer had not caved on his price.

[Aerides]

I am a committed "buy new and keep it for 10 years" buyer, but my current car was a 1-year old CPO from the dealer, with 10k miles on it. Still had new car smell.

I saved about 4k off the current year model, got an extra year warranty than new (2 years on remaining original, and 2-year add on for CPO). And since it was the only one of that make/model for sale in my half of the state, with the exact color and specs I wanted, I got it right away vs. waiting 3 months for the new one.

And I'm still gonna keep it for 10 years.

[97guns]

Quote:

Originally Posted by Rianne We are firm believers in the used car market. Are the online used car sites to be trusted? We would get it checked out by our mechanic. Also, local dealerships might have a good deal, but once purchased you're on your own unless there's a warranty. We've never bought a used car, but think it's the smartest thing to do.

I bough my first used car in 2016, it was a 2 year old Passat for $13k with 12k on the odometer. I bought it from a VW dealer, it wasn’t certified but with that amount of miles I didn’t care. Buying used saved me 1/2 the cost of a new car, prior to this I had only bought new but now I think I will never buy new again.

[jazz4cash]

It's tough to beat a 2-3 yr old off lease factory certified used car. CarMax, CARFAX, popularity of leasing, and overall improved quality of most makes have changed the game. CarMax really set the bar for 3 day returns that most good dealers also offer. I would avoid independent dealers other than CarMax and favor dealers that sell new cars of the same make and offer factory certified used car programs. As several others have noted, the savings may be minimal but used car asking prices will drop if they don't sell quickly. Check cargurus.com and your credit union for deals and info.

[RunningBum]

Sorry, I can't ignore this:

Quote:

Originally Posted by Rianne We are firm believers in the used car market. .. We've never bought a used car

My guess is if you have bad luck with a lemon, you won't be so firm.

Anyway, you haven't said how used you are looking, so strategies will vary. I think you'll get a fair (but never great) deal from CarMax. I tried selling a car to them once and they found some problems with it, so I know they really do look at cars they get, unlike many dealers who just use the trade in as leverage for a sale. But I don't think you'll find a car for under $10K at CarMax. And not to say a car from a dealer is bad. I got my best used car from one. And my worst two--one was back in college, always a risk at that price, but the other was a nice looking 5 year old '90 Acura.

I think the best deal to be had is to find a car coming off lease. If it's from a friend, all the better. People may trade in cars that are in good shape, but sometimes it's to get rid of a problem. Off lease cars generally come back on a schedule, and while they could also have a problem, people usually planned well in advance to get rid of it at that time, no matter what. The pay out price of a lease can be a good deal, so getting it directly through the lessee is best. But if you have a relationship with a salesman and ask them to be on the lookout for a model coming off lease, it's probably worth it. Especially if you can see all the service records.

In any case, have you Kelly Blue Book app (maybe there is a better source now?) ready to look up fair values. Private party sales are usually better deals, but again you may be buying a problem car, and you won't get any kind of warranty.

We have an biweekly email in our community, where people can post things for sale. Every month or two there is a car, and almost always the asking price is higher than what you should pay for at a dealer. These are mostly retirees, so maybe they really are "little old lady" cars, but I can't believe the prices they are asking. You can't just assume those will be good deals.

[Sarah in SC]

I think to be comfortable buying used cars, especially in the sub $10k range, you have to have some decent mechanical expertise and know exactly what you are buying. This is the market we've been in for 25 years, and have rarely bought cars that didn't last as long as we expected.
Generally we look for older American cars with a bit over 100k miles, and find them on Craigslist or through friends. I do like a "little old lady" car, and have gotten some fine boring sedans that way.
Having no experience in higher end cars, nor in buying new (my one and only was new in 1988, and I put 385k miles on it) I can't say what the expectation is for reliability, but we don't worry too much when a car needs work, it just gets done when we have time. Also helps to have a spare car if your slightly lazy mechanic (DH) isn't inspired to lay under the car right away.

[Rianne]

I am now rethinking this whole thing. As I said, we've never bought a used car. I did not mention that my car, a 1997 Camry has 180,000 miles on it. And my DH has a 2004 Camry that has 260,000 miles on it. They're both in pretty good condition and we are religious in changing the oil every 3-4K miles. The thing is I want to travel by car more and farther. We're afraid to take our cars on a long journey, like 5 or more hours of driving. It now makes sense to me to buy a new car. We'll just drive it into the ground like we did the cars we have. I figure we can get 20 years out of a car pretty easily and we'll be 80 before we have to buy a new one.

[REWahoo]

Quote:

Originally Posted by Rianne It now makes sense to me to buy a new car. We'll just drive it into the ground like we did the cars we have. I figure we can get 20 years out of a car pretty easily and we'll be 80 before we have to buy a new one.

+1

Plus, you can get a nice new Camry for not a lot of money - as cars go.

[Big_Hitter]

i've bought 3 used cars off of CL and one from carmax

[OldShooter]

Quote:

Originally Posted by Rianne I am now rethinking this whole thing. As I said, we've never bought a used car. I did not mention that my car, a 1997 Camry has 180,000 miles on it. And my DH has a 2004 Camry that has 260,000 miles on it. They're both in pretty good condition and we are religious in changing the oil every 3-4K miles. The thing is I want to travel by car more and farther. We're afraid to take our cars on a long journey, like 5 or more hours of driving. It now makes sense to me to buy a new car. We'll just drive it into the ground like we did the cars we have. I figure we can get 20 years out of a car pretty easily and we'll be 80 before we have to buy a new one.

The "drive it into the ground" philosophy, which I believe in, doesn't require starting with a new car. You can still save additional $ thousands by starting with a previous-model-year new car, a certified used car or a good lease return.

Of course, if you want a new car and can afford it, the extra cost is just a luxury expense like travel or many other things we do without trying to make them cost-effective.

[samclem]

Quote:

Originally Posted by OldShooter The "drive it into the ground" philosophy, which I believe in, doesn't require starting with a new car.

True. But if the plan is to drive the car for 20 years, then the prorated annual impact of saving a few thousand dollars on the price is fairly small. And if the car has been treated well from the get-go, there's a better chance of making it to 20 without big expenses. Also, if you are gonna live with it for 20 years, it is nice to get just the color and trim level you want, not more or less.
Well, at least that's how DW and I rationalized it��.

[OldShooter]

Quote:

Originally Posted by samclem ... impact of saving a few thousand dollars ... is fairly small. ...

You make me smile because I have recently been reading Richard Thaler and Daniel Kahneman on the subject of behavioral economics. The impact of saving a few thousand dollars is always the same: a few thousand dollars.

[athena53]

DH and I bought our last two cars from Enterprise Rental. Very happy with them and since I hate the BS of car buying (and DH is in that Great Used Car Lot in the Sky), will probably use them again. No-haggle pricing, free to have your mechanic check it out, and we did get a discount on one for issues the mechanic found.

[RunningBum]

Except when that new car you take care of from day 1 lasts longer, perhaps a lot longer, than a car someone has, maybe, taken care of, and may have problems.

The other point is that a few thousand dollars once in 20 years is a lot less than a few thousand dollars if you buy new every 5 years. 3-4 thousand is small compared to 15-20K.