Used Vehicle Buyers Guide

1. Beginning the Search for Your Next Vehicle
2. Best Places to Find Used Vehicles
3. Phoning Used Vehicle Ads
4. Items to Look For When Viewing a Used Vehicle in Person
5. Considerations Before Purchasing a Used Vehicle
6. Bargaining
7. Payment
8. Purchasing a Used Vehicle From a Used Vehicle Lot
9. Purchasing a Asked Vehicle From a Dealership
10. Purchasing a Used Vehicle From the United States
11. Conclusion

Beginning the Search for Your Next Vehicle

The first step in finding a great used vehicle is you must know exactly what you want. The more specific your used vehicle search is, the faster and easier it will be. Price range is probably the greatest determining factor for most people, so begin there. What price can you comfortably afford to spend on a used vehicle?

The next questions you should ask yourself are: What make, model, and year of vehicle would I prefer? The fewer options you can narrow it down to, the better. It is much easier to determine the overall condition of a used vehicle if you are comparing similar models of the same age. For example, when buying a Honda Civic, it would be easier to tell which owner had maintained his/her vehicle more meticulously if you can compare vehicles of the same model and year. So if you have your search narrowed to:

Price: $10,000.00 to $12,000.00
Make: Honda
Model: Civic
Model Year: 2001-2005
KMS: 60,000km-150,000km

Then finding something you want becomes much simpler, and you can compare like-to-like to find the vehicle in the best overall condition and, therefore, get the best deal.

It is also advisable to begin your used vehicle search in your immediate area or an area with which you are familiar. This will make your search much easier, faster, and—if you decide to buy—your bank, insurance company, and licensing agency will be very close. This will make it much easier to pay for your vehicle and drive it home. It also makes it convenient if you need a mechanical inspection as you can take your vehicle to a local, known, trusted, and reputable mechanic.

Of course, if you find a great deal or an exact match to the vehicle you have been looking for outside your immediate area, then it may be worth the extra time and effort to buy elsewhere. Preparation is vital when considering an out-of-area used vehicle purchase. It will save you a lot of time, stress, and money if you prearrange insurance, licensing, banking, and inspection before-hand. Before looking at it, call your insurance company and get a quote for this vehicle, so you know how much per-month it will cost you to insure it.

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Best Places to Find Used Vehicles

Now that you know exactly what used vehicle you are looking for, it is helpful to know where to look for that used vehicle. The fastest and easiest way to find a great used vehicle is the Internet. Your search is conducted from the comfort of your own home at no cost to you. Right now in Canada there are two websites that are excellent resources for finding great used vehicles. The website www.AutoTrader.ca has thousands of listings, a search field that allows you to sort by make, model, price, and year, and most ads have pictures. But if you are looking for strictly private sales, you will have to weed through a predominance of dealership ads to find them. Another great website, www.CanadaSuperSeller.com, allows you to search for used vehicles in your local area and also enables you to sort and search by make, model, year, and price. It is a newer website and has fewer ads to browse. CanadaSuperSeller.com offers a few features that are unique and in my mind really make their service stand out, which is why I have included them in this text. The best feature is a free RSS feeds service that will auto-notify you as soon as a vehicle matching your specific search criteria is listed. Another feature that will be added soon enables users to sort ads by private/dealership; so if you want to look only at private sales ads you will be able to do so.

These websites can save you time by enabling you to search by price, make, model, year, and area. You can also view a picture of the vehicle and there is usually a 100- to 500-word description of the vehicle. These websites also publish their listings. Publications can be a good place to look but it can take a long time to leaf through a thousand or so used vehicle ads to find what you want. If you do not find a vehicle on the Internet that matches your search criteria, there are also some good deals to be found in your local newspaper’s classified ad section. These ads usually have only a very brief description and sometimes no picture, but they are local and it may be worth the extra time and effort.

As you search for your used vehicle with whatever medium works best for you, begin to collect ads of vehicles in which you are interested. Copy and paste them into a Word document on your computer, or cut them out of printed magazines and collect and organize them in order of priority. Conduct all of your searching at once—collect all the ads you are interested in before making any phone calls. It will be much easier to compare vehicles later using this method. You may want to consider conducting your search in one or two days, collecting the ads you are interested in. You want to move fast on a great used vehicle or it may be sold before you have a chance to look at it. Once you have your list of prioritized ads, look for things such as "private seller," "original owner," "low kilometers," and "mint condition." Be wary of ads that say things such as "very fast" or "won’t last"—don’t exclude them but get ready to ask lots of questions when you make the initial phone call. It could just be the bottled-up used vehicle salesman in all of us coming out in a private seller or it could be a private seller that sells a lot of garbage used vehicles for profit (more about how to avoid this kind of seller later).

If you have lots of time to search for your next used vehicle, it is a good idea to look at these used vehicle sites often and watch vehicles that have been reducing their prices; if the seller is motivated, you can sometimes offer $500–$1,000 less than he/she is asking and your offer will be accepted.

If you do not find your ideal used vehicle right away do not become discouraged. It is a good idea to invest five minutes daily to briefly check websites to see if there are any new listings that match your search criteria. Some websites, like CanadaSuperSeller, have features that will auto-notify you of new listings matching your search criteria.

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Phoning Used Vehicle Ads

Once you have a list of used vehicle ads you are interested in and would like to pursue, it’s time to call the sellers. A sure way to weed out sellers who have multiple vehicles for sale is to start the conversation with: "Hi, I am calling about the used vehicle for sale." If the seller answers "which one?" they are obviously selling more than one vehicle and chances are they sell multiple used vehicles to make a profit or they are some kind of used vehicle dealer. Be extra careful of this type of seller as they will try to not reveal where they acquired the vehicle. Ideally, you want to purchase a used vehicle from a mature, original owner who has all the service records and receipts. If the owner is not the original, it’s acceptable, but you want to make sure the current owner can supply you with the vehicle’s complete service and maintenance history and it’s in your best interest to do a VIN# or title search.

It’s also a good idea to take notes of the seller’s answers to your questions as you can refer to them later; it helps prevent getting confused from one vehicle to the next. Taking notes is also beneficial because you can ask the questions again while looking at the vehicle in person, cross-referencing the answers to see if the story has changed. A well-rehearsed and thorough phone call should last at least 5–20 minutes and can really save you time as you will find out if the vehicle is worth looking at.

Pay careful attention to the seller’s answers to these questions. Hesitation, nervousness, or fast talking are all signs of an untruthful answer. If you are satisfied with the answers, set up a time to view the vehicle. Try to go during the day to see the vehicle in daylight—it’s much easier to get a good look at the vehicle this way, and it is also much safer. Be cautious of sellers who want to meet you somewhere to show you the vehicle; more often than not these sellers are selling garbage used vehicles for a profit (the vehicles might be stolen) and don’t want you to know where they live. If the seller offers you to come to his/her residence to look at the vehicle and it’s more convenient to meet somewhere else, use your discretion. In this case it is much safer to bring along a friend rather than looking at a used vehicle alone. Try to arrange to meet in a parking lot or somewhere else public.

Before calling, you may find it helpful to download one of our free PDF lists of critical questions to ask. It is helpful to print these guides and check off items as you ask them; take notes under each category.

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Items to Look For When
Viewing a Used Vehicle in Person

If the vehicle sounds appealing when you call, and you agree with the seller on a time and place to meet, you will find it helpful to download and print our free PDF list of things to look for; you can find it here. Taking notes directly after or during this initial inspection can also be beneficial. This initial inspection will save you money on a mechanical inspection if you find a major flaw yourself or decide you do not like the vehicle.

Should you get a mechanical inspection done? If the vehicle had any negatives from the PDF list, or if anything made you feel uneasy on the test drive or when you looked at the vehicle (i.e., the oil was gritty or smelled burnt), you should definitely have the vehicle mechanically inspected. If the vehicle is older than five years or has mileage exceeding 100,000 km it should definitely have a mechanical inspection preformed regardless of the checklist results. It is customary for you, the potential buyer, to pay for the inspection, but this also means you choose where the inspection takes place. If the seller refuses a mechanical inspection or insists on using a certain mechanic, this is cause for alarm and you should consider looking at other vehicles.

If, however, nothing has concerned you on your inspection or test drive and everything from the check list was positive, then the vehicle is probably fine. It has been the author’s personal experience that mechanical inspections can be inconsistent and they can also be expensive. Unless you have a mechanic that you know and trust, the $80–$100 you will spend may only offer a false sense of security. I have purchased 18 used vehicles for myself, my family, and friends using a checklist similar to this. The list has enabled me to pick only used vehicles in excellent overall condition. I have developed this list over the years, and the one I provide you with today is far better than the original material I had. However, I am not a licensed or professional mechanic, so if you are unsure then get an inspection done. I will offer this personal experience with mechanical inspections, though, as it helped me develop the list. I had a Honda Civic I was interested in buying inspected by one of the largest Honda dealerships in Calgary for $150 (full exterior and mechanical inspection). They failed to tell me that the vehicle had been subjected to major body work. The vehicle was mechanically sound but any good professional inspector should catch something as major as replaced body panels, windows, and lights. In this case a simple VIN# search on the Internet or at a local licensing/registry would have uncovered this information.

Should you check the VIN# for accidents or theft recovery? VIN# searches are fairly cheap and can be done very quickly at almost any Motor Vehicle Registry in Canada or on many websites. Not all accidents get reported but any involving insurance companies or the police do. Checking the VIN# offers peace of mind and value for a low price (about $20). Checking the VIN# also tells you if there are liens on the vehicle.

If you are a resident of Ontario, request to see the Used Vehicle Information Package (UVIP) that sellers are required to purchase before selling a used vehicle in your province. More information about UVIPs can be found here.

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Considerations Before
Purchasing a Used Vehicle

Consider resale: Could you list this vehicle for sale tomorrow—if you wanted or needed to—at the price that you are considering paying today and have a relatively quick sell? Could you relist this vehicle in six months? A year? Never buy a used vehicle that you could not easily sell tomorrow for what you are paying today. If it turned out you didn’t like the vehicle for any reason and you couldn’t sell this vehicle tomorrow for what you are paying for it today, you are paying too much. This is especially important if you do not plan on keeping this vehicle long-term. Also check the Black/Red/Blue Book value on this vehicle (found on links page). What are similar vehicles listed privately selling for? How much will it cost you to insure this vehicle? If you feel that you are paying too much or if you have a gut feeling that there may be something wrong with the vehicle, walk away from it and find another, there are plenty of used vehicles for sale. Base your decision to purchase on how you feel about the vehicle overall. How did the inspection go? Did you feel that the seller answered your questions truthfully? If a vehicle needs mechanical work, even minor work, consider continuing your search as these vehicles can require constant repairs. Before making the final decision to purchase you should call a dealership or mechanic and find out about this specific vehicle’s regular service recommendations, generally vehicles require major and expensive servicing at 40,000, 80,000 and 120,000 km intervals.

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Bargaining

You may decide that you like this vehicle but that the seller is asking too much. You can make an offer but explain it and base it on reasons like worn tires, etc. Use any items you found to be unacceptable in the inspection as leverage when bargaining. A vehicle that is in sound mechanical condition but has some items that are worn or need replacing can be a great find as you may be able to legitimately offer the seller less. If a seller rejects your offer then leave, but first give him/her your phone number; the seller may reconsider. As a buyer you really hold all the power in a bargaining situation so if you feel pressured or rushed into making a decision, leave and give yourself time to think. Remember, there are plenty of used vehicles for sale and deals to be had.

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Payment

A bank draft is the best method of payment as it is traceable. Make sure the seller fills out the Bill of Sale completely and accurately. All blank spaces must be filled with at least an X so they can not be changed later. It’s also convenient if the seller fills out the Bill of Sale on the back of the registration. Always take your time when filling out the paperwork. Always get an exact copy of the Bill of Sale from the seller. Also, ask the seller if there are any items that came with the vehicle like touch-up paint, brochures, or spare tires. Get any additional accessories like winter tires and have the seller include this in writing on the Bill of Sale. Ask the seller if there is anything else you should know about the vehicle such as how to use the remote starter or any other aftermarket accessories. Ask about spare keys or keyless entry remotes. If there is only one key, question the seller about this.

Buying used vehicles privately is very easy if you know what to look for. If you do your due diligence, it’s far more worth your while to buy used than new. Buy used diligently and save yourself thousands of dollars.

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Purchasing a Used Vehicle
From a Used Vehicle Lot

One thing needs to be very clear: There is a great deal of difference between a used vehicle lot and a dealership. Dealerships take pride in upholding their name and will usually only sell a used vehicle that is in a good state of repair; that’s why their prices are higher than those of a used vehicle lot. Dealerships are also more easily held accountable if they sell you a lemon. Used vehicle lots, for the most part, try to sell anything they can for a profit. This may be a bit of a generalization, and there may be some good used vehicle lots out there, but they are rare. In this author’s opinion, it is more advisable to buy used privately, without an inspection, using the above resources, than to buy from a used vehicle lot. If you decide to buy from a used vehicle lot, be sure to contact the Better Business Bureau and research the company’s history to find out if they have had any formal complaints placed against them. Some used vehicle lots receive inventory from all kinds of salvage sources—theft recoveries, business vehicle liquidations, and auctions, to name a few. Again, there may be some good used vehicle lots but they are scarce. Be especially careful of those that keep changing ownership or name. If you are considering purchasing a used vehicle from a used vehicle lot, be extremely diligent in asking questions and request the used vehicle have two, separate, thorough mechanical inspections—one from a dealership the same make as the vehicle, and one from an independent private mechanical shop of your choice. Never ever put a deposit on a used vehicle from a used vehicle lot—the sales people will usually request a deposit so you will feel obligated to buy.

If you own or know of a used car lot that is fair and reputable, please email me and I will investigate it and place the name on this site if I find it to be reputable.

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Purchasing a Used Vehicle
From a Dealership

Some dealerships offer used vehicle guarantees that state you can return the vehicle if anything goes wrong within the first month or so. This peace of mind is nice; however, it comes with a large price tag as you will pay at least a few thousand more for a used vehicle from a dealership.

Don’t be fooled, however, into thinking that because you are buying a used vehicle from a dealership the vehicle is in sound condition. Most dealerships get their used vehicle inventory on lease-backs and trade-ins, so most of their vehicles are in good condition but there are some vehicles that the salespeople are happy to get rid of. If you are going to buy a used vehicle from a dealership, demand to see what the dealership paid the previous owner for the vehicle. It is doubtful you will ever get to see the real number because there is such a large discrepancy between what they paid and what they are asking. Dealerships usually pay $3,000–$5,000 less to the seller than what the vehicle is worth. They clean it, detail the interior, fix any problems as cheaply as possible, then resell the vehicle for $1,000–$3,000 more than what private sellers are asking.

If you are going to buy a used vehicle from a dealership, go in with the attitude that you know exactly what you are looking for and that you have lots of time to look. Take your time and don’t let sales people pressure you. Be aware that many dealerships use a "bait and switch" tactic; this is how it works: they entice you onto their lot by advertising low prices or a big sale, then the sales people convince you to buy a more expensive vehicle or, even worse, a brand new vehicle, then they offer you their financing. When should you buy from a dealership? If you have absolutely no time to shop for a private sale or if your credit is terrible—then and only then should you consider buying from a dealership. Only offer to pay Black Book price on the vehicle (if it is used) because that’s what the dealership paid for it, or, at the very most, what private sellers are asking for the same vehicle. A link to Black Book values can be found on the links page of this site.

Chances are if you bought used from a dealership, you paid a very high premium on the vehicle but will receive some sort of guarantee in return. It’s the false sense of security that you pay for when buying from a dealership. You can find great used vehicles privately and keep all that cash in your own pocket where it belongs.

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Purchasing a Used Vehicle
From The United States

It is cheaper to buy most new and used vehicles in the United States. You may run into the following scenario if you are considering a purchase. You ask the current owner to provide you with the Bill of Sale. You also ask for the telephone number of the person the seller bought the vehicle from so that you can call that person to discuss the vehicle’s history and also to confirm the selling price. However, the current owner refuses or makes excuses as to why they cannot do this. Chances are the vehicle you are looking at was bought in the United States for anywhere from $2,000–$20,000 less than what you are going to pay for it. Is there anything wrong with buying a used vehicle from the States? Not if you know the vehicle’s full past history and not if the current seller is giving you a fair price. It is up to you, the buyer, to check with your provincial regulations as to whether the vehicle must be modified before being allowed to be registered in your province. All provinces have different rules; some will not allow even a modified foreign car to be registered until it is a minimum of 10 years old.

Also, many sellers are buying high-end sports or luxury vehicles from the United States, brokering them across the border, then selling them in Canada for a price that seems ridiculously low and they are still making between $2,000 and $20,000 profit. The good thing is, it is easy to know if the vehicle you are buying is from the United States. The best way is to check the VIN# at your local registry or online. Another quick check is to simply look at the odometer, temperature, or speedometer to see if the units are predominantly Imperial or metric. Be aware though, the dashboard could have been modified.

It is much easier to buy a used vehicle from your local area, but if you think you are getting a great deal and are seriously considering an out-of-country used vehicle purchase, invest the time and money in getting it properly inspected and imported.

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Conclusion

Buying a used vehicle privately is a financially beneficial choice; you can literally save thousands of dollars. Consider this scenario: You buy a one year-old vehicle with 15,000–30,000 kilometers, still under factory warranty, privately for $5,000–$8,000 less than the new sticker price at the dealership. Suppose you drive that vehicle for one year and put between 10,000–20,000 kilometers on it, all while properly maintaining it and keeping the records to add to the original records, then sell it for the same price or slightly less than what you bought it for. Using this method you can drive nearly new vehicles for the rest of your life, and it would only cost you between $500–$1,000 per year, depending on the used vehicle market at the time of buying and selling.

Buying and selling used vehicles is very easy if you take your time looking and educate yourself in the process.

For more detailed information on buying used vehicles, purchase the book Private Sale: A Complete Guide to Buying and Selling Used Vehicles. The book will be available through this website and on Amazon.ca in early 2007.

For more articles on why buying used vehicles is your best choice, click here.

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