7 Red Flags to Watch for on the Used Car Market
Is that used car the bargain it’s cracked up to be? Here are seven warning signs of a lemon.
How to Navigate the Used Car Market
Buying a used car instead of a new one is a great way to save money, but the used car market is fraught with peril. If you are not careful, you could end up with an expensive lemon instead of a reliable set of wheels. Here are seven red flags to watch out for the next time you venture onto a dealer’s lot.
Red Flag #1: An Inflated Window Sticker
Car dealers know that buyers will want to negotiate down from the window sticker, and they sometimes inflate the price to get what they want. Negotiating up from the invoice is the smarter strategy, so always research and find out what the dealer paid before you go shopping.
Red Flag #2: A Skimpy Warranty
Sometimes a dealer will price a car unrealistically low and make up for it by offering a skimpy warranty. A warranty that seems generous at first glance may be anything but-a 20,000 kilometre warranty that covers only the engine could still leave you with thousands of dollars in repair costs. Be sure to read the fine print carefully and ask for details if you have any questions.
Red Flag #3: A Sketchy History
Used cars can change hands lots of times, and former owners are often reluctant to reveal hidden damage or mechanical problems. Getting an official history on the vehicle you are considering is an absolute must-you never know what that shiny exterior could be hiding. Services like Carfax allow you to get information on everything from flood damage to past accidents.
Red Flag #4: Mismatched Paint
Mismatched paint or a freshly painted car could mean the vehicle was heavily damaged in an accident and the dealer is trying to hide that fact. Check the entire surface of the vehicle and look for spots where the paint looks shinier or less faded-and always check the full vehicle history before you buy.
Red Flag #5: An Undisclosed Recall
Millions of vehicles are recalled every single year, and owners do not always get the notification they should. Some of those recalled cars, trucks and SUVs end up on dealer lots, and dealers do not always check the VIN numbers for outstanding issues. Always get the VIN and check it against the government database before making a purchase.
Red Flag #6: A Salvage or Reconstructed Title
If the vehicle has been totalled in a wreck or damaged in a flood, the insurance company may have bought it. If you are not careful, you could end up with a vehicle that has all kinds of hidden damage. Take a close look at the title, and know the codes to look for in your province.
Red Flag #7: An Expensive Financing Package
Car dealers make a lot of money on financing-often as much as they make on the car itself. Be wary about financing offers from the dealer and always compare the terms to what you could get on your own.