How To Choose A Used Car
There are a lot of advantages to buying a used car, rather than a new one. Price is an obvious benefit. Used cars can be a lot cheaper than new cars, and thus keep you from having a monthly payment.
But how you choose used car can make all the difference. Choose the right car, and you can save a fortune over a new car. Choose the wrong one, and that brand new car will look like a bargain in hindsight.
Build A Target List Of Used Vehicles
It's no secret that the Honda CR-V and the Toyota RAV-4 make for good used cars. But they might cost a few thousand more than a comparable Ford Escape or Kia Sportage, even though these are solid cars too. So if you're looking to save money, consider more than one brand. We suggest making a list of three cars that meet your needs and fall within your budget. Edmunds reviews have great information to guide your choices.
If you're planning to buy a vehicle that is less than 5 years old, consider one that's certified pre-owned (CPO). CPO vehicles have long-term warranties that are backed by the carmaker, not just the dealership selling it to you. Franchised dealerships that sell that same brand new are the only ones that can sell a CPO car of the same brand. So if you want a CPO Chevy Equinox, for example, you'll need to buy it from a Chevy dealer.
Set Your Budget
There are really only two ways for you to buy a car: Pay cash or take out a loan. If you’re paying cash, budgeting is pretty simple. But don’t spend all your savings. Remember to set aside money for registration and insurance — and possible future repairs.
Most people take out a car loan so they can protect their savings and buy a more expensive model. It’s smart to get preapproved for a car loan because it simplifies the buying process and puts you in a stronger position at the car dealership. You’ll see later how preapproval fits into the process.
Consider The Certified Pre-Owned Car Option
Not sure if you want to take the leap into a used car with no warranty coverage? There is a used car option that does have factory warranty coverage. Manufacturer-certified pre-owned cars (CPO cars) offer a blend of used-car affordability with manufacturer-backed warranty coverage. They're usually low-mileage cars that are just a few years old, with service records and no history of accidents. They are often cars returned at the end of leases, dealership service loaner vehicles, or vehicles driven by dealer or automaker staff.