Why Buy a Used Car from a New Car Dealer?

Many people think of private sales when they consider buying a used car, or “pre-owned,” as we like to say. But there are many reasons to think twice about that car on someone’s lawn or driveway, or advertised on the internet or elsewhere by a private seller. It all starts with the protection, security and expertise a new car dealer can provide you with, that a private seller cannot.

1. Warranties. If you buy a car privately, you buy it “as is.” There are no warranties, unless the car still has a manufacturers’ or transferable extended warranty. There is no “Lemon Law” protection, which is a statutory warranty, depending on the age or number of miles. Typically, you might take a short test drive, or even have your own mechanic look it over, but if that car’s engine falls out or the electronics go, once you have the title, you are out of luck. You have no recourse against the seller. In addition to the Lemon Law, many new car dealers provide additional warranties on used cars, and/or can sell you an additional warranty. One, large surprise repair can make that expense very worthwhile. While car quality is pretty good these days, you don’t know what shape the car is really in or what repairs it has had, if you buy it privately.

2. Inspections and Skilled Technicians. A new car dealer must perform a full inspection prior to resale. The car must meet the legal standards for an inspection. A private seller has no such requirement, and the car’s last inspection could have been up to a year ago. The new car dealer has the most highly trained and skilled technicians and the most up to date equipment. New car dealerships are “state of the art” and can assure that the vehicle is in top notch condition before the sale.

3. Financing and Trade Ins. A new car dealer can help you arrange for financing and can take an older car in trade from you as a down payment. A private seller cannot help you pay for the car and will not take your old one in trade.

4. Relationships and Reputations. A new car dealer depends on repeat service and sales business, and positive word of mouth. The only way a new car dealer does well is by creating long term customers. In a private sale, the seller will probably never see you again, and has no stake in how the car performs. They want the money and that’s it. The dealer wants you as a customer for life. Another word of warning – beware of private sales between friends and relatives, unless you know them and the car really, really well. An easy way to ruin a relationship is to put car problems between a seller and a buyer who will continue to frequently see each other.

5. Cost. It’s true that new car dealers may not have a large supply of very low cost, very high mileage vehicles for you to choose from. They will, however, offer the largest inventory of used vehicles overall, in a variety of price ranges, in all shapes and sizes, and they can help you locate the vehicle you need and want. Stop and consider what the investment means. Suppose you are looking to spend under $5,000 for your teenager to have a first car. Older cars in that range may have the least safety features and may have been through a variety of experiences (weather, accidents, etc.). You could drive it for a while and then have a big, expensive repair to contend with. Perhaps your kid is away at college and then has to deal with the broken down car, and you have to deal with the phone call for $1,000 or so to fix it. For a little more money, you probably could have leased a new car for three years, and it would be under full warranty and have all the safety and high tech features available. Or you could purchase a slightly newer and lower mileage vehicle with an extended warranty. And there would be no surprises. (Unless your kid smashes it up, unfortunately, and then you would have to fix it before the end of a lease.)

If you are still determined to buy that old thing on someone’s lawn, here are some things to be careful about. Make sure you check it out inside and out, including the trunk. Look for any signs of water damage (such as sections of new carpet or stains from a water line). See if there is a Carfax report available and buy it, or tell the seller to buy it for you. Have a technician of your choosing look it over. Make sure you get a clear title (no liens on it) and both keys. If you are the seller, be careful about going for test drives with strangers (take someone else with you). Go with the potential buyer to their technician, if they want to have the car looked at. Check to see if there is a cost to transfer a warranty. Accept only cash or cashier’s check or money order, and if it is anything other than actual cash, complete the transaction in the parking lot at the bank (go with the buyer to get the check). Avoid having potential buyers, if strangers, come to your house to see the vehicle (find a neutral location). If they have trouble with the car later on, you don’t want them coming back to bother you about it.

Buying any car is an important decision, for the cost involved, it’s purpose in getting you to work, school or elsewhere in a reliable manner, and for safety. Don’t make an impulsive decision because it’s shiny and gleaming, in a size and color you like. It’s the inside of the car and under the hood that should concern you the most, as well as the condition of the outside, how it has been cared for and what it will cost you in the future. For a reliable vehicle, the right service, help with financing, selection and safety, see your new car dealer for a used car!

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