How to Buy a Used Car and Save Money

Buying a used car instead of a new car has its advantages. First off, someone has already taken the huge initial depreciation loss on the vehicle when it was purchased new. Second, you can buy a used car just a couple years old, with a lot more bells and whistles, for a lot less money.

woman shopping for used car |

Not only will buying a used car save you money, it's just as easy as buying a new car. There's only a couple additional steps you should take to ensure you don't end up buying an unreliable vehicle or someone else's problem.

The two things you must do is have an independent certified mechanic look at the vehicle for any cosmetic or mechanical defects and run a used car history report to make sure the vehicle has a clean title history. This may cost you a little bit of money up front, but it's better than getting stuck with a bad vehicle you can't sell.

My guide has helped thousands of people for over a decade save money during the used car buying process. It walks you through step-by-step on how to buy a used car with confidence and by following it, you will avoid any attempted car dealer scams.

How to Buy a Used Car and Avoid Scams

If you wanted to go used car shopping back in the day, you normally started in the Sunday paper, or drove from lot to lot ultimately having to decide between a handful of vehicles. Once you found the one you liked, you'd have to make a snap decision to spend several thousand dollars, hope you don't get ripped off and know nothing about the vehicle you're buying...Talk about STRESSFUL!


Today's consumer has so much information available to them. This information, used correctly, makes the used car buying experience fun and far less stressful. For well over a decade I've helped friends, family, and thousands of readers save money buying a used car.

My step-by-step used car buying guide is a combination of this modern day information and my years of experience in the car business to guarantee you get the best deal and avoid car dealer scams. Let's get started.

1. Begin the Used Car Shopping Process Online

Today you can do 95% of your used car shopping online. You will still need to visit the dealer to visually inspect and test drive the vehicle. However, most of your pre-shopping can be done right from the comfort of your own computer, tablet or smart phone.

Car dealers know smart car buyers shop online, they also understand if they're going to compete with other dealers in the area, they must post their used car inventory online for sale.

There are several million used cars for sale online. Used car listing sites make it easy to cast your net far and wide and then narrow down your search parameters to find the exact vehicle you're looking for within minutes.

Recommended Used Car Shopping Sites

Get free used car quotes from

CarClearanceDeals will search clearance prices in your local area. Their huge dealer network will help you find your next used car quickly. Make sure you select all the dealerships in your area to make sure you maximize your discounts and savings.

Find a Used Car at Car Clearance Deals Here >>

Get free new car quotes from

Edmunds is one of the oldest used car research and review sites on the Internet. Their huge dealer network will help you find your next used car quickly.

Find a Used Car at Edmunds Here >>

Search used cars at CarsDirect

CarsDirect has been in business for well over a decade. Their search tool makes it easy to find the exact car you're looking for.

Browse Used Car Inventory at CarsDirect >>

Click here for my full article on used car price quotes >>

2. Check a Used Car's History

In my opinion this is the most important thing you can do when buying a used car. There is an added cost, but I promise you, it's well worth it. While your shopping online, any vehicle your interested in, check its history by its VIN before spending any more time on it.

I've seen many people in my career blindly buy a used car only to bring it back a few days later after finding out it's been in an accident or flood. Good luck talking a dealer into letting you out of the deal, you agreed to buy the car "as-is where-is." It's your responsibility to do your due diligence first, after you sign the paperwork it's too late.

Completely avoid this nightmare by reviewing a vehicle's history upfront as you're shopping and comparing vehicles. All you need is the 17 digit vehicle identification number to get a vehicle history report. Dealers are aware people will pull their own vehicle history reports and will post the VIN on the used car listing online. If the VIN is not posted with the vehicle the seller is hiding something, do not buy the car and move on to the next one.

There are several fly-by-night vehicle history report companies on the web, some are better than others. I've personally used several of these companies and have pulled thousands of vehicle history reports in my career, and I always prefer using AutoCheck.

For consumer use I recommend the AutoCheck Multiple Report Plan, it allows you to run 25 reports by VIN for 21 days, making it the best value for the money. This gives you plenty of time to research and inspect the history on as many cars as needed before making a final decision. Read more about the AutoCheck Multiple Reports Plan here.

Most major auto auctions and lenders use AutoCheck over its competitors because of how accurate they are in disclosing vehicles that have been rebuilt or branded with frame damage.

Insider Car Buying Tip

It doesn't matter if you're looking at a used car or certified pre-owned vehicle. I highly recommend you spend a little money and thoroughly inspect any used vehicle you're considering. By doing so, you're decreasing your chances of buying an unreliable car. Keep in mind a dealer doesn't want to be stuck with a bad car no more than you do.

Visit my detailed guide on Vehicle History Reports here >>

3. Arrange Used Car Financing

During the car buying process, most people are more worried about getting the "lowest price" than on the financing portion of the deal. As with buying a new car, you should have a pre-approved used car loan in place before visiting a dealership.

There are differences between new and used car loans. Interest rates for a used car loan normally run anywhere from 1-2% higher than what the rate would be for a new car. Depending on the age and mileage of the vehicle, a lender will raise the interest rate and/or shorten the loan term to decrease their risk. To make matters worse, most banks will not finance a used car over 5 years old.

You can check rates with your local bank or credit union. If you want to get the best rates and terms you will want to apply with well known online companies that specialize and understand the used car market.

Trusted Used Car Auto Loan Sites

Get a car loan quote from myAutoloan

MyAutoloan allows you to submit your information once and they'll send you up to four offers for you to choose from.

Get pre-approved with here >>

Get a car loan quote from instantcarloan

InstantCarLoan has been providing good people with a variety of credit backgrounds safe and trusted auto loans for over 10 years.

Apply with InstantCarLoan here >>

Get a car loan quote from Auto Credit Express

AutoCreditExpress is one of the leaders for finding bad credit auto loans for people who've been turned down elsewhere.

Apply with here >>

Click here for a full article on car loan quotes >>

4. Negotiate and Buy a Used Car

Most people get discouraged during the negotiation part of the car buying process. As long as you are prepared and have the information upfront you'll have nothing to worry about.

Used cars do not have an invoice. This makes it almost impossible for someone to know what a dealer actually paid for a car. On top of not knowing how much a dealer has in a car, the used car market fluctuates up or down almost on a daily basis. So what can you do? You can calculate how much money a dealer should have in the vehicle and negotiate from there.

Once you receive the information on the car you want to buy from the listing sites above, read my article on how to estimate dealers a dealer's used car cost here.

When negotiating the price of a used car, your goal is to purchase the vehicle below or as close to trade-in value as possible. This will give you a good idea of what to pay for the vehicle and keep you from being ripped off. Click here to learn how to negotiate a used car's price effectively.

5. Get an Extended Warranty for Your Vehicle?

When you buy a used car, you typically buy it "as-is where-is" unless the vehicle has any remaining manufacturer's warranty left. If the vehicle doesn't have any warranty left, you will be responsible for any repairs the vehicle incurs. Always check the age of the vehicle and the mileage to see if the manufacturer's warranty is expired.

Dealer's have huge mark-ups on the extended warranties they offer. I suggest getting a couple free quotes from reputable online warranty companies to compare against the dealer. You can use these quotes as leverage when negotiating the price of a warranty with the dealerships finance department.

The companies I recommend are Complete Car Warranty and Endurance Vehicle Protection. If you'd like to learn more about these companies and how to use them to your advantage when negotiating with a dealer, visit my extended auto warranty guide here.

Insider Car Buying Tip

Some dealerships will promote high mileage long term warranties at a cheap price. Beware of this type of coverage, they may be "Powertrain Only" warranties and only cover items that do not commonly wear out. No matter where you purchase an extended warranty, make sure you read the fine print and understand what's covered and more importantly, what's not covered.

Additional Used Car Buying Tips

Various additional tips and advice pertaining to the used car buying process.

Don't Be Afraid to Walk Away

Don't let your emotions take over, I've seen people make some pretty dumb purchase decisions based on emotions. Just so you know, a dealer knows when you become emotionally involved and they will hold their ground. If the dealer is not willing to deal or negotiate, kindly thank them for their time and walk away. I promise you will find another car you'll want to drive.

Buying a Certified Used Car

The word "certified" or "certified pre-owned" really doesn't mean that much. It was created by the all mighty car gods to stimulate the used car market to sell more cars. What it does mean is the dealer can mark-up the vehicle's price and entice you with a cheap powertrain warranty that's honored by the manufacturer.

Most dealer's use the same standard Used Car Inspection (UCI) checklist if they certify them or not. There are only three manufactures that take the word "certified" seriously, and that's Mercedes, Toyota, and Honda. They will spend crazy money to bring one of their cars up to certification levels.

My advice is to not fall for the "certified pre-owned" BS. A car is a car no matter what designation is assigned to it. You should check the history and have a mechanic inspect any vehicle before you buy it. It's better to know your safe than be sorry.

Research the Make and Model

I'm not talking about the history of the specific car you're looking to buy, I'm talking about researching the actual make and model of the vehicle. Check past reviews, check recalls, check and research everything. What are the typical repairs, known weak points, price points and cost intervals. A great source for finding good information is using forums or fan blogs when possible.

Should I Buy a Program Car?

I get this question a lot. Program car is just a fancy name for "off-lease" or most of the time "previous rental vehicle." In actuality that's where most program cars come from, previous rentals. What sounds better to you? I have this "program car" for sale, or I have this "previous rental car" for sale?

Think about the last car you rented. How well did you treat it? How many people drove it like they stole it and just ragged it out, you've heard the famous quote, "Oh, it's just a rental."

At my dealership we would tell customers that previous rentals, I mean program cars, are well maintained because they must keep them running to make the company money. Truth is these cars go well over the recommended preventative maintenance schedules, especially oil and filter changes because they get re-rented as fast as they hit the lot.

I've sold thousands of program cars in my dealerships over my career. Many of the low mileage used cars you see on a dealer's lot are previous rentals. You will ultimately have to make the decision if you want to buy a program car. These cars normally have some minor interior and exterior nicks and scratches along with marks in and around the trunk area from people tossing luggage into the trunk. An AutoCheck used car vehicle history report will notify you if a vehicle was previously a rental.

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My Recommended Sites for Car Shopping

CarClearanceDeals and Edmunds are the quickest way to check used car prices in your local area. These online sites will provide you with free, no-obligation quotes and the prices you're quoted are normally very good. You can also use this free information to negotiate a better price between dealers.

Car Clearance Deals new car price quotes

Did You Know?

A used car does not have an invoice like a new car. This makes it impossible to determine the exact amount a dealer may have paid for the vehicle.

I'll show you how to determine what a dealer should have in a used car, and you can start your negotiations from there.

Click here to estimate a used cars cost >>

Visitor Comments

I can't thank you enough. You saved me a bunch of money on the car I bought last month! - John C.

OMG, you're tips kept me from buying a car that had a salvaged brand on the title. Thank you, thank you, thank you. - Tiffany C.

Best car buying advice on the web. Thanks for putting it out there. - Siena P.

Can I kiss you on the mouth? I just want to thank you for saving me over $5,800 off the price of my new (used) 2016 Nissan Armada. - Clinton A.

Let me know what you think >>

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Used Car Buying Tip

When buying a used car, the two most important things you can do to protect yourself from making a mistake are:

  • Have the vehicle inspected by an independent certified mechanic.
  • Acquire and review a used car vehicle history report.

A mechanic will put the car on a lift and inspect the cosmetic and mechanical systems of the vehicle and the history report will disclose any discrepancies in the vehicles title history to guarantee you're purchasing a clean reliable vehicle.

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