Buying a Used Car
If you’re in the market for a used car, consider the following tips.
Shop around to get the best deal. Check these sources:
- A franchised dealer that sells both new and used cars is a good source for customers willing to pay top dollar. The dealer saves the late-model trade-ins for resale, while the less desirable vehicles are auctioned or sent to wholesalers. Franchised dealers have repair facilities and often provide warranties.
- Used car dealers are a good source for older, higher mileage used cars. Some used car dealers do their own financing. While most used car dealers sell their cars “as is,” some are willing to provide limited warranties.
- Banks and other lending institutions often sell repossessed vehicles.
- Private owners sell their own used vehicles without any dealer mark-up. If you buy from a private owner, get copies of the vehicle's service records, references and records of original purchase.
Set a budget and stick to it.
Determine how much you can afford to spend on a used car and stick to it. If you plan to finance
the car, compare rates from several lenders and make sure the monthly payment meets your budget. Don’t get pressured into bigger payments than you can afford.
Read the terms of the contract.
If the deal is being financed by the auto dealership or a lender solicited by the dealer, make sure the contract states the interest rate, also known as the annual percentage rate (APR). It should also contain everything you and the dealer have agreed upon. Don't reply on verbal promises. Your signature confirms your agreement with the terms stated in the contract. Never sign a contract that contains blank spaces.
A contract is binding.
Unless the contract specifically says otherwise, you can’t cancel it once you and the dealer have signed it. There is no three-day right to cancel nor any other "cooling off" period. Make sure the contract states that you can void the agreement and get back your down payment if the dealer does not meet any part of the agreement.
Take a test drive. Drive the car under many different conditions, such as on hills, highways and in stop-and-go-traffic.
Inspect the car thoroughly. Consider taking the car to a mechanic that you trust for a pre-purchase inspection prior to signing any sale document. Typically costing around $100, it has the potential to save you much more money if it turns out the car has major mechanical problems.
Ask whether the car has ever been in an accident. Find out as much as possible about the car's prior history and examine its maintenance record.
Watch out for odometer fraud. It is illegal to tamper with an odometer. Check the current odometer reading against service records and previous mileage statements. Look for scratches on the odometer or the dashboard, misaligned digits, digits that stick or an odometer that fits loosely.
Ask if the car is still under warranty. If the manufacturer’s original warranty on the car hasn’t expired, ask to have that information stated clearly in your written contract.
Review offers for extended warranties or service contracts. Before you buy a warranty from a dealer, consider existing warranty coverage, whether the car is likely to need repairs, and the costs of repairs compared to the costs of the service contract.
Make sure you’re paying a fair price.
Check resources at your local library or visit Web sites like www.nadaguides.com
to find out the market value of the make and model you are considering.
Remember that the dealer must maintain the dealer’s tags and insurance on the vehicle until the purchase transaction is finalized.
We Can Help
If you have a complaint about used car sales, contact us for help
or call toll free within North Carolina at 1-877-5-NO-SCAM.