2. FIND A PLACE TO BUY YOUR USED CAR

This is an important step, because where you buy the car will be a major factor in its quality, price, and headache levels. There are four options that most people choose: auction, private individual, used car dealer, or used car superstore (we're just so darn alphabetical!).

Auction

This is when you go to one of those government auctions where repossessed drug dealers' cars are auctioned off to the lowest bidder. Or maybe you're buying the car on eBay. But before you purchase a car from [email protected], you need to know the risks of auction purchasing:

  1. While you are likely to get a good price (since this is a market-driven sale), you can't be entirely sure what you are purchasing. You may have seen the ads for government repo sales where you can get a Porsche 911 for three hundred dollars. That's usually a sucker line.

  2. Since these auctions involve repossessed cars, cars sold by dealerships, and some privately sold vehicles, you still might get screwed over. True these vehicles may appear in great shape, but unless you are a very knowledgeable auto mechanic, you may be purchasing someone else's damaged goods without knowing it. Auction cars may have been previously damaged in an accident, by floodwaters, by pre-teen sexual activity, or by owner abuse. Yes, they might be reconditioned, but the parts used are often substandard and the work less-than-perfect.

  3. On top of all of these caveats, it is usually difficult to get any sort of warranty on an auction-purchased car.

Our advice: forget about auctions. It's just too risky. But if you're determined, just look in the auto section of your newspaper under auctions. You'll find plenty.

Private individual

A second and more traditional method of purchasing a used car is though a private individual. While there are several warnings to heed, many of them can be overcome through simple preparation. Private individual sales can be found in the newspaper, through used car advertising books and through word of mouth. Though the newspaper and advertisement route may be a more daunting option because one does not know the seller, these sales also offer the variety that one cannot find from friends and family.

Private sellers offer an opportunity for both parties to save money. Individual sellers know that they won't get everything that their car is worth if they trade it in, and the buyer knows that the negotiations will be less hectic. Also, with a private seller, a test-drive can be carefully used to determine whether or not a vehicle is in proper condition and running-order. You can also have your own personal mechanic check the car out before you buy it. So the overall benefit of a private individual is that you're dealing with a human being (not a company or a dealer) who probably wants to get rid of the car as much as you want it. To find a car using this method, just look in your newspaper, or do a search online of used car newsgroups. There are also tons of websites where you can specify exactly what kind of used car you're looking for, and then get hooked up with a private seller. Some popular ones are:

Used car dealer

A used car dealer (or even a new car dealer) offers an option that can provide peace-of-mind for many buyers (as well as the thrill of the negotiation over a stale cup of coffee). It may appear that you are paying more through a dealer than you would be through a private individual or an auction. However, there are some good reasons for going to a dealer:

  1. A dealer-sold car is usually a well-inspected vehicle with at least some kind of limited warranty.

  2. It is possible to check with friends and family to get their recommendations as to the best and most reliable dealer in the area.

  3. If your vehicle (God forbid) ever turns out to be a lemon, you will be better protected, since the dealer is easy to locate and confront. For further info on how to deal with a lemon, check out step 4.

Used car superstore

Used car superstores, such as Circuit City's Carmax, have begun popping up all over the country. They offer pre-inspected, low mileage, certified vehicles in a low-pressure situation. These stores often have a no-haggle approach to your purchase of a vehicle. This means no negotiating, no hassle, and sometimes a higher price. What you sacrifice in value is often made up for in assurances that you are making a wise purchase.