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December 02, 2021 Auto

Buying a Used Car: Loan Checklist

If you’re in the market for a deal on used wheels, follow the steps below for a smoother ride!

Step 1: Crunch the Numbers

How are you paying for your new car? If you’re paying cash, you’ve probably already established a car budget.

If you’re taking out an auto loan, your lender will help you determine how much you can afford. Consider getting pre-approved for your loan before visiting the dealer’s lot.

Step 2: Create a Target List

Make a list of must-have features to help narrow down the make and model you want to buy. Once you’ve narrowed down your list to three or four cars, compare each of their reliability ratings against each other using Consumer Reports.

Step 3: Research

Start researching prices and availability for the vehicles you’ve chosen. Visit multiple sites to determine the average asking price for each vehicle. This will help you negotiate later in the process. You can find used cars for sale in any of these locations:

  1. The used-car section of new-car dealerships
  2. Used-car dealerships
  3. Used-car retailers like CarMax.com

Next, find out the necessary details about each vehicle with a vehicle history report from Carfax.com.

Step 4: Call the Seller

Contact the seller to verify the information you’ve learned about each car. Ask the seller to see a car history report or get the VIN and run one yourself. If you’re using a private-party seller, ask about any possible mechanical issues. If you’re working with a dealership, ask if the vehicle is still in stock and for any information, you couldn’t find on your own.

If everything checks out, set up an appointment for a test drive.

Step 5: Take a Test Drive

Pay attention to these details during your test drive:

  • Is there sufficient legroom?
  • Is the ride smooth?
  • How is the acceleration?
  • Is the “check engine” light on?
  • Do you have complete visibility?
  • Are the brakes working well?
  • Do all the lights work?

Next, ask for the vehicle’s service records to determine if it’s up-to-date on scheduled maintenance.

Step 6: Have the Car Inspected

Having your car inspected by a mechanic can save you loads of aggravation and lots of money down the line.

Step 7: Negotiate

Make an opening offer based on the average price for your car and use all the information you’ve learned about your vehicle as bargaining chips. Be firm, and you will end up with a reasonably priced vehicle.

Step 8: Make It Official

Ensure that the title and registration are transferred to you if you’re buying your car from a private-party seller. Carefully consider any extra upgrades that may be offered from the dealership. Finally, read the contract carefully and make sure you have insurance before you drive off the lot.

Now, you’re all set to take your new car for its first spin!

This article is for educational purposes only. WeStreet Credit Union makes no representations as to the accuracy, completeness, or specific suitability of any information presented. Information provided should not be relied on or interpreted as legal, tax or financial advice. Nor does the information directly relate to our products and/or services terms and conditions.