Things to Ask When Buying a Secondhand Car

Price is only one consideration when purchasing a used car.
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You may yearn for a new car, but your budget says "used." Just because you're buying a secondhand car, doesn't mean you have to settle for second rate. Asking the right questions can ensure that the used car you buy is a good value for the money you're paying, even if you don't get to enjoy that new car smell.

Ownership History

Whether you purchase your car from a dealer, online or from a private seller, knowing the ownership history is important. Besides ensuring that you are able to obtain clear title, the ownership history may give you clues about how well the car has been maintained. If a car has only had one previous owner, that's usually preferable to a car that has changed ownership several times. This is especially true for a relatively new car that has had several short-term owners -- the car may be a lemon.

Vehicle History

Besides checking for obvious signs of damage such as rust, upholstery tears and dents, you should obtain the vehicle identification number and get a vehicle history report. The vehicle history report, which is available from a number of online sites for a fee, discloses such red flags as flood damage or serious accidents. If a vehicle history report includes a salvage title, run, don't walk in the other direction. A salvage title is issued when a vehicle is totaled, either through serious damage from environmental circumstances such as flooding or from a crash. Even if the vehicle history seems OK, you should have the car checked out by a mechanic before you pay any money.

Warranties, Lemon Laws and Buyer's Remorse

Many used cars are sold "as is," which means that once you've made the purchase, you are almost never able to obtain a refund. However, many newer used cars carry warranties for maintenance, parts replacement and repair labor costs. This is especially true for certified pre-owned cars, low mileage cars that the dealer or manufacturer certifies have undergone a thorough inspection before being offered for sale. In addition, the Cooling-Off Rule from the Federal Trade Commission allows buyers who purchase merchandise, including cars, at their own homes or away from the seller's main business location to return the merchandise within three days and receive a full refund. The Cooling-Off Rule generally doesn't apply to sales by private individuals, though. Finally, nearly all states have some version of a lemon law that covers cars, although some laws are limited to new cars.

Price and Financing

If you have an idea of the make, model and approximate year of the car you want, check out Kelley Blue Book for the average price for similar models sold in your area. If you run across a car that is much higher or much lower than the Kelley Blue Book price, be prepared to ask tough questions or just walk away. If you are not paying cash, shop around for financing. Even if you are credit challenged, steer clear of "buy here, pay here" lots that often feature poor quality vehicles with jacked-up interest rates for financing.

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