This Lazy Woman’s Used Car Buying Method (L-O-N-G)

The recent issue of GEICO’s insurance newsletter had a brief article on buying used cars and what you should look for. These things included:

• Crash test results from NHTSA
• Recalls
• Safety features
• Vehicle maintenance and VIN history
• Theft statistics
• Working order
• Ride

I’d like to tell you how Wenchypoo looks used cars in the mouth like gift horses. Before I even get near the car, I look up all the things that will earn me a discount on my auto insurance, like safety features, number of doors, what kind of horsepower will get charged for “sports car” rates rather than passenger car rates, which cars have the highest likelihood of theft (in parts or the whole car), and most importantly, make, model, and color are thrown right out the window—loyalty to one manufacturer or one specific color will only serve to shrink your world of possibilities needlessly. Let the initial shrinking be done through theft statistics, VIN history, and safety features—these things will serve to lower your insurance bill when it comes time to add a car to your policy.

If the VIN number is available online, I go to my local DMV and run it to look for things like flood, collision, lemon law recall, or shady title issues—this alone has saved me from buying “hot” cars from personal sellers numerous times. An immediate DMV report is usually available for a nominal fee—your local office will inform you of the prices.

If the car is listed for sale online, there’s another advantage: the Kelley Blue Book or NADA book for vehicle valuation—at either one of these places, you can look up the car in question and find out what it’s REALLY worth with mileage, options, condition, and model. The owner’s perception or the dealer’s idea of value may not be entirely accurate (and is usually way overpriced) for the condition the car’s in.

I try not to go to the actual lot or driveway until I have all the information obtainable about the car before getting close to it—this way, I’m not making myself vulnerable to the seller and any high-pressure tactics. If this means a CarMax report, I get it, but it usually doesn’t go that far. I highly recommend going online where you can look at vehicles for sale without having to subject yourself to starving salesmen—this way, you can collect information at your leisure: number of doors, any listed features or options, the occasional VIN number, and year/make/model for value verification. Personal visits to the car can be done on Sundays when the lot is closed.

If I happen to find a car that fits the bill, and know what it’s worth, here’s a tactic I use for selecting a car based on mileage: because my family drives less than 10,000 miles per year (an insurance discount cutoff), I use that number to compare to the year of the car. An example: a ’02 Ford Taurus with 72,000 miles on it—I would consider this to be too high mileage, meaning it doesn’t have enough life left in it for me. Here’s how I got there—10,000 miles (amount driven yearly) X a 5-year-old car = 50,000 miles, my mileage budget for an ’02 vehicle. Where or how this car was driven makes no difference to me—a mile is a mile, whether it’s highway or not. So-called “commuter miles” means the car was driven like an ox, and probably maintained like one, too (in other words, rarely saw a vet). To me, fewer miles mean more life left in the car, and this example Taurus is 22,000 miles over my budget. With today’s car-centric culture, you’d think I’d have great trouble finding choices based on my mileage requirements, but I don’t.

The car must also be 3 years old or older—by then, the bulk of the depreciation has fallen off, and I’m not likely to be upside-down in any financing, or suffering a huge loss of value.

Sticker price is a big bugaboo for me with dealers—they take a car in trade, pay half what it’s worth, clean it up, then mark it up to twice what it‘s actually worth according to Kelley. Only stupid people pay the sticker price, because they don’t bother to do the homework before going to the lot—this is how salesmen stay in business. I actually bother to look at the REAL value of the car, then start with an offer 20% below the true value. By the time I get through dickering, the car price has actually reached it’s true worth according to Kelley, and I didn’t get ripped off price-wise.

As far as working order, ride, and recalls go, that can be taken care of with a trip to the mechanic. No car is absolutely perfect, and every car should be taken to a mechanic anyway to assess the oil, transmission fluid, filters, belts, brakes, radiator, and tires—after all, you’re buying a USED car! Color can also be changed with a quick paint job, so this car can BECOME your favorite color, or at least a less objectionable one. If you are paranoid about the mechanical condition as a purchase contingency, then have a mechanic give it a once-over, then ask this question: would he/she feel comfortable sending their kid off to college in another state with this car in its current condition? If the answer is no, then the car has little mechanical life left in it, and has entered the nickel-and-dime stage of auto repairs to keep it going.

One more thing that might sway a car purchase: parts for imported cars are more expensive than domestic models—the parts as well as the cars have to be imported, and this takes time and money (namely yours).

I wouldn’t worry about crash test results because you’re likely not going to own this car long enough to care about it, and surely aren’t planning to get yourself into a crash anyway. “What about the other driver?” you ask—that’s something beyond your control, and that’s where safety features (namely air bags) can help make up the difference. People buy brand new cars all the time without regard to crash test ratings, so why would you hesitate when buying a used one?

Finally, there’s this little tidbit: the car you saw online or in the paper may not be available for sale when you actually get to the selling place—this is a common tactic used by dealers to attract shoppers. Dealers will advertise a complete steal of a car, and it miraculously vanishes when anybody comes in to buy it BECAUSE IT WAS NEVER THERE IN THE FIRST PLACE! Chances are very good that this car came in from an auction, got bought right away by a salesman, and will be fixed up and flipped at a later date (for a much higher price). This happened to my brother-in-law in Arizona over a minivan, and he took the dealership to court (and won his suit for fraud). This particular dealership had been advertising that specific minivan for weeks, and it never materialized—the dealer used this car as an ad campaign, and when he couldn’t produce it for purchase, he got taken to court. In court, he said they had the van briefly (long enough for photos, I bet) before selling it to someone else—yet he continued to advertise that same minivan! The moral of this particular story is never to limit yourself to one choice, for it may be a complete illusion.

Always have more than one selection in mind when it comes to actually seeing the cars in question—they may be “suddenly sold” and a high-pressure salesman may come pouncing, ready to divert you to another (unresearched) car—one with the highest profit margin. Have a list of possibilities, go visit each one (if available), and bid on the one you like best or actually had access to.

Go to the car seller with price in mind, and money in hand (or financing already lined up)-—they also make hefty profits on dealer financing). If they won’t cooperate with accepting your final offer, then simply walk out—nothing says you have to stay and be subjected to their brow-beating and arm-twisting. Nothing moves dealers more than someone with a check in hand and a firm, final offer—they’d rather sell the car at a small loss than have you walk out the door, never to return. What they fear most from you is bad publicity via word-of-mouth.

Money talks, and as long as you have the money to spend, you can make these lackeys be YOUR lackeys. Like home sellers and retail merchants, these people need to bend backwards to accommodate you, because you have something they want (money), and they want to make a sale. Never let them lose sight of that, and never lose control of the negotiations. Make them feel like they should be honored by your presence.

I myself had occasion to strong-arm a dealer—I named my final price for a car, the dealer told me that a little old lady at the next desk also wanted the car, and she was willing to pay a higher price. I picked up my stuff, stood up, and said, “Let her have it then,” intending to walk out. That sentence alone caused some more huddling between salesman and manager, and I got the car at my price, out the door (that means including tax, title, license, and registration). What put me ahead of the deal was the check I had in my hand—it turns out the little old lady needed financing, and the dealership preferred their money NOW. This forehand knowledge of the car, cash in hand, and “threatening to leave” tactic allowed me to shave $8,000 and $6,000 off my last two car purchase prices.

Next time, I plan to deal directly with the sales manager myself. I finally figured out that the salesman is merely a go-between for the manager (who has the real power) and the customer (who also has the real power). Never, NEVER be afraid to walk away when things get out of your control, and stack the deck in your favor with information about the car(s) before ever leaving the house. Homework alone is half the battle.