The second you drive off the dealer’s lot, your brand new car starts to depreciate. So, why not buy a money-saving used car? Choosing a used vehicle with low miles and a good reliability rating can save you thousands over buying a new car. 

What To Check When Buying a Used Car 

How do you choose the best used car that meets your needs? How does financing work, and should you consider adding a warranty? All good questions.

There are a dozen more you should ask when buying a used car, including:

1. Why is the owner selling? This is a good question if you’re buying a used car from a private seller. Is the vehicle running correctly? How old are the tires? How many miles per gallon does the car get? Has it been in an accident? These are just a few questions you should ask. After all, the owner should know the answers better than a dealer.
2. What was the car used for? Like the question above, this is a good question if buying from a private seller. If the vehicle has low miles because the car was only driven to the grocery store twice a week, that‘s good to know. But if the vehicle was used to commute to a job 50 miles away, then you’ll want to know that also.
3. How well was the car maintained? Find out if the vehicle has maintenance records showing oil changes, wheel alignments, etc. You might also ask if the car was serviced at a dealership, a private shop, or only by the owner’s brother-in-law. 
4. What works and what doesn’t? Maybe the car initially came with heated seats, but the heater on the driver’s side no longer works. Or, perhaps the air conditioner only blows out hot air. A service professional can do an exterior and interior check to see what works and what doesn’t.
5. Is the car certified pre-owned? To certify a used car, a certified mechanic must record everything that was fixed. Ask to see this paperwork.
6. Can you take a test drive? The answer is likely yes. But you may have to limit how many miles you drive, how long you take it out, and if you have to bring it back with a full tank of gas. This is an excellent time to take it to a trusted mechanic to give the car a once-over. 
7. Does the car have any left-over warranty? If the vehicle is only a few years old, there are things—mechanical, interior, transmission, brakes—that may still be under warranty. 
8. Do you take trade-ins? If you’re roaming the lot of a dealership looking for a used car, and you have a vehicle you’d like to trade in, find out how much they’ll give you for your vehicle. That will provide you with a better idea of a down payment or how much car you can buy on your budget. 
9. What’s the price? This may seem like the first question you should ask, but if you’re not satisfied with any of the previous questions’ answers, the price won’t matter. 

Used Car Taxes and Fees

Most people buy a used car to save money — both in loan principal and interest. And, while you’ll likely save big on the sticker price, you will be on the hook for used car taxes and fees. 

Dealership Fees 

If you buy a used car from a dealership, you’ll likely be required to pay several fees (along with state-mandated sales tax), including:

• Documentation Fees: The “doc” fees are for all the paperwork included in the sale of the used car.
• Credit Insurance: If you finance your vehicle, you may be asked about credit insurance, which covers the loan if you pass away or become disabled before the payoff date. Remember that your regular car insurance plan may cover this, so check first before agreeing to this fee.
• ‍Advertising Fees: Dealerships may (or may not) charge you for the advertising it took to get you into the dealership. You may be able to negotiate these fees, so ask before you pay. 
• Warranty Fees: Most certified pre-owned cars come with warranties. A dealership may try to talk you into an extended warranty or service agreement, which goes beyond basic warranty coverage. 
• Trade-in Fees: Some dealerships charge a trade-in fee if you trade in your vehicle for a “new” used car. Like advertising fees, you may want to dispute this fee.
  

Private Sale Fees

If you buy a car from a private seller, you can forget about paying any dealership fees. However, there are several fees you may want to consider if buying from a private seller.

• Vehicle History Report (VHR) Fee: This report can tell you the correct odometer reading, accidents, and maintenance. The fee can be anywhere between $10 and $40. 

DMV Fees

• Transfer and Registration Fees: These fees vary from one state to the next, and each state handles them differently. If you buy your used car from a private seller, you and the seller will handle the fees.

Used Car Sales Tax

Have you ever heard of a double tax? Car buyers are required to pay tax when they buy a new car and also when they purchase a used car. This tax varies from state to state. 

Car Insurance For Your “New” Used Car

All states require car owners to purchase car insurance. If you buy a used car, you may only need liability insurance. Some states require comprehensive, liability, and collision coverage until the loan is paid in full. ‍

Liability Insurance: Liability coverage protects you legally if you have an accident that causes injuries to people or property. Instead of paying out of pocket to cover medical bills or repair costs, liability insurance covers these costs. ‍

Comprehensive Insurance: Comprehensive coverage covers damage to your car in the case of an accident. It also covers weather-related damage, theft, vandalism, and more. In most states, comprehensive coverage is optional, and if you buy used, you may not need it at all.

‍Collision Coverage: Collision insurance will help pay for repairs or replace your car if it’s damaged in an accident. Even if that accident is a tree or a fence. If your vehicle is being financed, collision coverage is usually required. 

How Long Do You Have to Get Insurance After Buying a Used Car?

If you buy your used car from a dealership, you will likely need insurance before driving the automobile off the lot. But if you buy your vehicle from a private seller, you have a certain number of days — usually from 7 to 30 — to get insurance. Of course, every state is different, so call your DMV or insurance carrier to see how much time you have. 

If you have an insurance policy in place on your current car, your policy may transfer to your new, used vehicle. Call your insurance company to add your “new” used car or remove your old car from your policy.