Following on from last week's post about the pitfalls of buying a new car, this week I'm talking about used cars. So you don't have cash running out of your pockets, you don't want the depreciation hit and you simply can't afford a new car. Big deal - millions of other people are in the same boat as you. My first 5 or 6 cars were all used cars and in reality more people buy used than new so how do you steer around the minefield that is the used car market? There's a few options nowadays - used car lots, manufacturer used car programs, auctions, ex-rental cars and ex-fleet cars. Manufacturer programs are pretty good - you'll pay a premium for them but they normally come with some form of guarantee. Used car lots are THE place to get a good price but you'll almost always be buying without any warranty so the onus is on you to make sure you know as much about the car as you can before you drive off with it. If it breaks once you've driven off, you're pretty much on your own. Auctions are interesting but you'll be competing with car dealers looking to buy stuff to re-sell and if you're not careful you'll end up paying over the odds because you'll get carried away with the whole atmosphere. My tip for this would be to go and look at ex-fleet and ex-rental cars, and I'll tell you why. Fleet cars (corporate or company cars) are maintained to within an inch of their life. Anying - anything that needs attention gets sorted out quickly so whilst the mileage will be high, the car ought to be in bloody good condition. And high mileage isn't necessarily a bad thing. I'd sooner buy a used car with 60,000 motorway miles on it than 10,000 city miles because the engine will have been humming along mostly in a low-stress state and will be nicely bedded in (most engines don't properly loosen up until about 30,000 miles anyway). Ex-fleet cars typically also come with a 3 month warranty on most things - not as comprehensive as a new manufacturer one but better than nothing. Ex-rental cars are something you might have never considered. Surely rental cars are beaten half to death, right? Again, generally speaking if anything goes wrong, the rental company gets it fixed pretty quickly. The mileage will be low - most rental cars are sold off after 20,000 miles or less. The car will have been driven by many drivers, not just one so there won't be any unusual wear and tear that can result from a single person with peculiar habits driving around for a couple of years. Best of all, ex-rental cars normally come with a 12 month warranty, and will normally come with fresh oil, fresh coolant, new tyres and if it has an automatic gearbox, fresh transmission fluid. If the brakes are more than 50% worn, they'll typically come with new brakes too. Those are all the bits that count and getting new stuff there is worth it. The downside is that the car will be a little beaten up. The interior won't be in the best condition and the bodywork will have scratches, dings and dents on it from parking-lot door dents to scratches on the roof where people have put bags and stuff up there then dragged them off.
When it comes to the price for a used car, the same holds true as does for new cars. You MUST do your research first. There are dozens of used car price evaluators around on the interwebs that will guide you as to what the car is worth. You'll be able to figure out roughly how much the dealer paid when they bought it either from auction or in a trade, and from that you'll be able to decide for yourself how much to pay. Again - as with new cars, if you come across a dealer that won't play ball, walk away. There are dozens of other dealers and thousands of other used cars.