Check prices of similar models with used car guides that you can find online or at your local library.
Research the vehicle's history. Use the vehicle information number (VIN) to research past owners, use, and maintenance. Find out if the car has been damaged in a flood or crash, had its odometer rolled back, or been labeled a "lemon."
Verify that mileage disclosures match the car's odometer reading.
Check with the manufacturer to verify if the manufacturer's warranty is still in effect.
Get and read the seller's return policy in writing.
Have the car inspected by your mechanic. The mechanic should check the vehicle's frame, tires, air bags, and undercarriage, as well as the engine.
Examine dealer documents carefully. Make sure you are buying—not leasing—the vehicle. Leases use terms such as "balloon payment" and "base mileage" disclosures.
Buying a Car from a Private Owner
You may choose to buy a car directly from an individual, instead of a dealer. The purchase price is often lower and easier to negotiate if you buy a car from a private owner. You should still take the same steps as if you bought the car from a dealership. There are more factors to consider if you buy from a private owner.
A private owner sells the car "as is." If the car has defects when you buy it, the seller isn't required to repair them before you purchase it. Also, federal protections and rules, such as FTC's Buyer's Guide don't apply. If the seller is fraudulent, you can't complain to your local consumer protection office about them.
If you choose to purchase a car from a private seller:
Learn about the options available for paying for a vehicle.
0:00 You know what kind of car you want and you know what you can spend. But don't 0:05 head to the dealer just yet. 0:07 Before you shop for a car, shop for financing. Financing a car means you pay 0:11 it off over time. But you don't have to get that financing through a dealer. 0:15 Check with banks, credit unions, and finance companies first, then take your 0:20 best financing offer with you to the dealer's. 0:23 You can still negotiate see if the dealer makes a better offer, 0:26 but if not, you can stick with the financing you already have. 0:30 If the dealer isn't honest when it comes to financing a car, 0:33 let the FTC know. Want to know more? Visit ftc.gov/cars
When you lease, you pay to drive a vehicle owned by an automobile dealership or leasing company. Monthly lease payments may be lower than loan payments, but at the end of the lease you have no ownership or equity in the car. To get the best deal, follow the advice below.
Compare leasing versus owning. The Consumer Leasing Act requires leasing companies to give you information so that you can compare monthly payments and other charges.
Compare lease offers from multiple dealers. Consider buying from an independent agent rather than a car dealership
Find out what the down payment, or capitalized cost reduction, is for the lease.
Calculate the total cost over the life of the lease, and include the down payment. A lease with a higher down payment and low monthly payments may be a better deal for you.
Ask for details on wear and tear limits. Damages that you regard as normal wear and tear could be billed as significant damage at the end of your lease.
Find out how many miles you can drive in a year. Most leases allow 12,000 to 15,000 miles a year. Expect a charge of 10 to 25 cents for each additional mile driven.
Check the manufacturer's warranty. It should cover the entire lease term and the number of miles you are likely to drive.
Ask the dealer what happens if you give up the car before the end of your lease. You could be responsible for termination fees if you end the lease early.
Ask what happens if the car is involved in an accident.
Get all the terms in writing. Everything included with the car should be listed on the lease to avoid being charged for "missing" equipment later.
Consumer Reports rates vehicles in terms of overall safety. Its safety score combines crash test results with a vehicle's accident avoidance factors, such as emergency handling, braking, acceleration, and driver comfort.
Even if you don't own a car, there are times when you may need one. When you rent a car, you're using a company's vehicle for a short period of time. Use these tips before signing the rental agreement to help you avoid unexpected problems and charges:
Fees: What is the total cost, after all fees are included? Will there be an airport surcharge or fees for car drop-off, insurance, fuel, mileage, taxes, additional drivers, an underage driver, or equipment rental?
Driving record: Ask whether the rental company checks customers' driving records when they arrive at the service counter. If there are problems with your driving record, the rental company could turn you away, even if you have a confirmed reservation.
Insurance: Be sure that you aren't duplicating coverage. You might have coverage through your personal auto insurance policy, a motor club membership, the credit card you used to reserve the rental, or your employer, if you're traveling on business.
Damages: Before driving off, inspect the vehicle for dents, scratches, and marks and check the tires. Report any pre-existing problems and ask the company to note them on your rental agreement. Try to return the car during regular business hours so you and the rental staff can look at the car together to verify that you didn't damage it.
Fuel: Decide if you are going to refuel the car before you return it, or pay for the fuel options provided the car rental company.
Payment method: Pay with a credit card rather than a debit card to avoid holds on other funds in your checking account.
Rental deposit: Does the rental company require a deposit? If so, ask for a clear explanation of the deposit refund procedures.
If you’d rather rent a car on an hourly basis and have greater flexibility in where and when you can pick up a vehicle, you can join a car sharing service. You get the convenience of a car when you need one, without the costs of ownership.
Fees: What fees does the company charge (annual fees, application fee)? Are they refundable, even if you cancel or are denied membership?
Availability of cars: Are there cars available at times that you need one? How far in advance do you need to reserve a vehicle?
Attendants: Are there on-site staff present when you check out your car and return it? This can be very helpful when you need to verify that the car is returned in the same condition as when you borrowed it.
Fuel: Do you have to pay for gas out of your own pocket or does the company pay for it?
Extension of time: How easy is it to extend the length of your rental? Is it done through an app or is there a dedicated customer service hotline?
Cancellation: How far in advance must you give notice to cancel a reservation or your membership? Can the company cancel your membership without notification?
Damages: Are you responsible for damages, even if they were not your fault or they happened after you returned the car? This is especially important if you return the car to a lot that does not have on-site staff.
Insurance: Is insurance included? You may be insured by a personal policy or the credit card that you use to pay for this service.