It is very important to be prepared and know your rights before buying a used car from a private seller. Once you have completed the transaction, you may not have recourse for your mistakes.
Preparation is Most Important When Buying a Used CarThere is no substitute for good preparation. Research the type of car you want and know the make, model and year of the car you're seeking to buy. You should be able to determine the general market value of a car, truck or SUV by looking in the newspaper and at popular websites that may also provide an automobile's blue book or trade-in value.
Perform a Thorough Inspection of a Used CarIf you've identified a specific vehicle that you like, you should first perform a good inspection and focus on all of the following items:
- Condition of the general exterior of the car, including the tires
- Writing down the 17-digit VIN numbers located on the dashboard and doors and making sure they match - if they don't, you'll want an explanation as this is frequently one warning sign of a potentially stolen vehicle
- Condition of the interior of the car, including water damage which could indicate leakage in the sealing of the car's roof, windows or other areas around the windshield and below the car, look at the carpeting and under the carpeting and seats, determine if there is rust damage
- Inspect the bottom of the car for signs of wear damage and rusting as well as after driving, look at the ground for signs of leakage, such as oil
- Inspect all items under the hood including fluid levels, condition of the components
- Check the body of the car carefully for signs of new or patched paint, parts that may not fit perfectly and which may have been replaced - all of these may be signs that the car was in an accident
You will certainly want to test drive the car to ensure that the handling is reasonably good, determine any rattling or other warning signs of a need for repair or which may be signs that the car was in a prior accident.
List of Questions to Ask the Seller of a Used CarIt is imperative to ask the seller of a car questions that will provide you with useful information prior to making your decision to go ahead and purchase a car:
- Are you the original buyer of the car?
- How many people owned the car before you?
- Why are you selling the car?
- How many miles on the odometer does the car have?
- Has the car been in any prior accidents?
- What kind of repairs or replacements have been made on the car?
- Has the car ever had water of flood damage?
- Has the car been declared a total loss by an insurance company?
- What items on the car have problems or may require replacement shortly?
Have a Mechanical Inspection Performed on the CarBefore purchasing a car or any other vehicle, you should request that it be inspected by an independent mechanic (obviously not the seller's mechanic) to ensure that the vehicle is in good working condition and to make you aware of items that may not be in good working order or may need replacement.
It's important to have an independent mechanic inspect the vehicle for mechanical defects before you buy. Be sure to get a written inspection report from the mechanic, with cost estimates for necessary repairs.
Independent Research on Used CarsDepending on where you live, you may be able to get at least some of the following information from your state's motor vehicle department:
- Research the car history at the National Motor Vehicle Title Information System [NMVTIS]
- Perform a VINcheck (National Insurance Crime Bureau)
- Odometer mileage each time the car has been sold
- Whether the car has been involved in any accidents
- Whether the car has been sold at auction
- The number of owners and sales dates
- If the vehicle was once leased, a rental car or a government vehicle
- When the dealer took delivery of the vehicle
- Any vehicle emissions inspection problems
- Whether the car has been reported as stolen
- Warranties that may apply to the sale of the vehicle
- Whether there is a lien on the car
- Research on the car using available databases such as Carfax, AutoCheck or at CarProof if you're in Canada.
Used car sales by private owners are usually not covered by the "implied warranties" under state law. Typically, a used car sale will probably be "as is" unless you have a written agreement from the seller that states otherwise.
You will want to examine any manufacturer's warranty that may still be in place to see what it covers, how much longer it will last and whether it extends to new owners. You can and should check with your state attorney general's office to find out whether there are minimum requirements for warranties and/or assurances that a vehicle will pass state inspection.
Closing the Deal for a Used Car PurchaseIt's especially important when dealing with a private seller to carefully document the sale before handing over your money. You should have a blank Bill of Sale form ready to fill in with the car's VIN number and seller's name and address.
Rather than bringing cash to the sale (which is dangerous and can't be traced), use a personal check or bank draft or bank check if a cash equivalent is required. If the car turns out to be stolen, you can try to put a stop payment on the bank draft and also trace where the check may have been cashed.
Be sure to check the identity of the seller of a used car by asking for his or her driver's license. It's also important to be able to review the car's registration and obtain the car title before handing over any money to the seller of a used car. If the seller can't produce the title, walk away from the deal as something is likely not right. The seller should record the mileage and the amount of the sale on the back of the title. If the title shows a lien holder, there should be a "lien satisfied" stamp on the title. It there is no lien satisfied stamp, it is quite possible that lien exists on the car and the seller might still owe the bank money for purchase of the vehicle.
You will also want to get any special equipment that should come with the car, such as wheel lug keys to unlock the lug nuts on the wheels. Make sure to do research before arriving at the closing and have a list of items to check that should come with the vehicle. With some preparation and caution, you can have confidence in buying a used car from a private seller.
The Contract: A Written Agreement is Important
A handshake deal makes resolving potential disputes extremely difficult. This is why it is essential to close a deal for a used car in a signed writing. The agreement should contain all of the following:
- A sufficient identification of the vehicle, including VIN number and mileage on the vehicle;
- The date of sale;
- The length of any warranties that may apply and specifically what the warranty covers;
- A sufficient explanation of the warranty coverage, including remedies such as car servicing;
- Make sure the selling party is correctly identified
- The name of the seller and their signature;
- Details as to any guarantees that have been made, including representations (such as a new transmission being installed, the car will operate in good working condition for 30 days, etc.), and
- A sufficient explanation of any money back guarantees, if any.;
- Personal Finance & Consumer Law:
- Buying and Selling a Car or Motor Vehicle
Buying & Leasing Best Practices For Buying a Used Car, Truck or Motor Vehicle
By Michael Wechsler |
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