How to buy a used car with confidence in 7 steps

Buying a used vehicle isn’t for everyone.

But when you go this route, you can usually spend less money, save on sales tax and insurance premiums, and give yourself a wider selection of vehicles to choose from.

Not all used vehicles are created equal, though.

So, how do you spot a fair price, figure out if you can afford it and know it’s safe to drive? Follow these seven steps to help you buy a used car with confidence.

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|1| Get pre-approved before you shop

If you’ll be borrowing money to buy your vehicle (new or used), it’s a good idea to get pre-approved for your auto loan before you shop.

This way, you’ll know how much car you can afford. It also helps you narrow your choices, saving you time as you shop, said Adam Dodds, indirect lending manager at Dupaco Community Credit Union.

When you go through the pre-approval process, you’ll be able to review your credit score. The higher your score, the less interest you’ll pay on your auto loan!

Find out the best way to build your credit >

Even if you plan to pay cash for your car, this is a great time to pause and review your monthly expenses. A free Dupaco Money Makeover can help you review your budget to determine what you can afford to spend. (It might even help you free up extra money!)

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|2| Research the car’s history

Whenever you buy a used vehicle, it pays to know its history:

“You’ll find out, for instance, how long the vehicle has been sitting on the dealer’s lot,” Dodds said. “If it’s been there a while, ask why.”

You can also request repair invoices and receipts from the seller. Pay attention to any new parts that have been replaced, and don’t be afraid to ask why.

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|3| Take the car for a test drive

Seeing a car in photos is one thing, but there’s no substitute for inspecting it in person—and more importantly, taking it for a test drive.

Pictures can hide rust, dents and other potential problems, so before you commit to buying a used car, make sure you check it out thoroughly.

When you’re behind the wheel, turn off the music and listen to the vehicle itself. Strange noises, rattles or performance issues could be red flags. Here’s a checklist of what to evaluate before you buy a used car:

Exterior inspection

• Check for rust, dents or scratches. Small imperfections are normal, but excessive rust could be a sign of deeper issues.
• Look at the doors, fenders and panels—are they aligned properly? Misalignment could indicate past accidents.
• Compare paint colors across different parts of the car. Mismatched paint could mean previous repairs.

Interior inspection

• Look for signs of water damage or excessive wear on the seats, dashboard and flooring.
• Check the odometer reading—does it seem reasonable for the car’s age?
• Test the air conditioning, heat and infotainment system to ensure they work properly.

Tires and wheels

• Inspect the tire tread for even wear. Uneven wear could indicate misaligned wheels or suspension issues.
• Check that all four tires match in brand and condition—a mix of tires may suggest a lack of proper maintenance.

Under the hood

• Make sure the coolant is clear and the oil, transmission fluid and brake fluid are the correct colors (not cloudy or murky).
• Look for any leaks or corrosion around the engine and battery.

Test drive checklist

• Is there enough legroom and headroom for you and your passengers?
• Does the ride feel smooth, or do you notice excessive bouncing or pulling?
• How is the acceleration—does the car respond quickly and powerfully?
• Are the brakes firm and quiet, or do they squeak or feel spongy?
• Does the “check engine” light stay on after starting the car?
• Are all the lights (headlights, brake lights, turn signals, interior lights) functioning?
• Do the power windows, locks and mirrors work properly?

|4| Get a professional inspection

Even if everything looks good, it’s worth having a trusted mechanic look at any used vehicle before you buy it.

A professional inspection could uncover hidden issues that could cost you thousands in repairs later.

If you or your mechanic see problems, don’t be afraid to negotiate. Ask the seller to fix them. If the seller won’t fix the issues and you still want the car, negotiate a discount.

A little diligence now can save you headaches down the road.

|5| Know your options when you buy a used car

If you’re in the market for a newer used vehicle, consider buying a Certified Preowned (CPO) car.

These vehicles are relatively new with low miles and have been inspected and refurbished by the dealership prior to the sale. CPO cars also might come with additional manufacturers’ used car warranties.

Due to the certification, though, these used cars will often come at a higher price than comparable used cars that are not certified, Dodds said.

|6| Use your free resources

Take advantage of the many online resources that can help you compare vehicles and their values, including:

• Kelley Blue Book: Get pricing, photos, reviews and other important data.
• CARFAX: Ensure that the vehicle has a clean title, the vehicle’s mileage matches what CARFAX says it should be and the vehicle’s valuation.
• National Highway Traffic Administration: Learn whether recall work has been performed on the vehicle.
• Edmunds: Learn the five-year ownership cost of a vehicle.

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“No two used autos are alike due to miles, options and condition,” Dodds said. “Pricing will vary between similar cars.”

|7| Trust your instincts

If it feels wrong, don’t be afraid to walk away. Trust your gut. And remind yourself that there are other cars out there if it doesn’t work out.