As a university student, owning a car is an expensive proposition. It can add several thousand dollars per year in expenses to an already tightly stretched budget. If you can buy a cheap used car – as in cheap, but reliable – you can cut that expense substantially.
Most of your ability to get a good used car will happen up front when you buy. There are ways that you can buy it at a lower price, and also ways that will help you to cut down the cost of repairs and maintenance later on.
Buy direct from the owner
Though it’s often easier to buy a used car from a dealer, since they have a large inventory and greater selection, it’s also a good bit more expensive. Dealers tack a profit on the price of any vehicle they sell, and that means you will always pay more. They can also offer financing deals that may not be as good as what you can get on your own, and will try to pack the purchase with extras such as warrantees that you probably don’t need.
You can find cars that are for sale by owner in popular published sources, such as your local newspaper classified section, and Craigslist. You may also find cars for sale just by looking around on the road at any car that has a “for sale” sign in the window. The advantage with any of these sources is that once you have information on the vehicle, you can quickly research the car’s value.
Get the value of the car in advance
There are excellent car valuation sources available on the internet, including Kelly Blue Book and Edmunds.com. Having value information on the car you want to buy from either or both sites will give you a strong advantage in negotiations and insure that you never pay more for the car than it’s worth.
Each site will give you two values, a lower one which represents what an individual can get for the car selling it himself, and a higher number that is what a dealer will charge to sell it. The lower number is what you’re interested in, and that is what you should use as your estimate of value.
Be sure to print off the results for the car you are interested in from both sites. You’ll want to have this available to show to the seller of vehicle in the event they’re charging an excessive price.
Get financing in advance – if you need any
In a best of all worlds scenario, you will pay no more for a used car that you can pay cash for. Buying a car for cash is one of the very best ways to keep your car expense to a minimum. But if you do have to get a loan to buy the type of car that you want, be sure that you apply for financing and get a pre-approval letter from the lender in advance of making an offer on any vehicle.
Having an approved car loan effectively makes you a cash buyer, and that’s always a strong position to be in. You will be able to buy the car that you want immediately, and that will give you a stronger hand with the seller. It will also eliminate any potential doubts you may have about your credit worthiness, or the amount you will be able to borrow.
Listen closely to the engine
This step probably won’t save you any money on the purchase of the vehicle, but it has great potential to save on repairs and maintenance later. When you’re test driving the car – and you should test drive it for as long as the seller will allow you to do so – listen closely to the engine.
If the engine runs smoothly and quietly, there’s a better chance that you will avoid costly repairs in the weeks and months following the purchase. This will also give you a good indication that the car has been well cared for and maintained.
If the engine makes any unusual sounds, even if they’re fairly slight, the car may need work. It can also be an indication that the car won’t last too long. Problems related to a car’s electrical system are bound to happen, and are often harder to identify in advance, but they tend to be less expensive to repair than deep engine problems that strange noises can indicate.
Have the car evaluated by a mechanic
If you are not mechanically inclined, it’s never a bad idea to have a mechanic check out the car before you buy it. You may have to pay the mechanic some money to do this, but it will be money well spent. A mechanic can identify potential problems in the car that mere mortals cannot. He may locate a problem with the car that can tip you off that you need to walk away from it.
Even if he identifies only minor mechanical flaws that are easily repaired, you may be able use these findings as bargaining chips to negotiate a lower price. However it works out, using a mechanic to check out the car in advance has the potential to save you hundreds or even thousands of dollars. And if the seller objects to a mechanical inspection, you will have strong reason to suspect that there may be an issue.
As a student you probably need to keep your expenses to a minimum. Car expenses have the potential to get out of control pretty quickly, so it’s important that you make your best deal on a car at the time of purchase.
Those are all great points you posted. Can you write one for a seller’s perspective?
Good post. My dad gave me my first car is an old 97 chevy lumina. It worked for about 3 years then it died on me. After I graduated college I bought my first car straight cash. It was a honda accord and it has been 2 years and it has worked out great so far. The mechanic is something I didn’t think about. Very good tip. It’s always wise to know what you are getting into before making just a large purchase.
These are great tips and guidelines. One thing to keep in mind if you are in the New Jersey, New York area is that there have been people selling cars damaged by Hurricane Sandy so greater care should be taken in these areas.