Car shopping can be confusing, especially if you’re looking for a used vehicle. Sometimes the perfect car for you is being sold by a private owner instead of a dealership. Is buying from a private seller a good idea? How do you know you’re getting the best deal on a reliable car?
Many car buyers find their ideal car, for their ideal price, by buying through a private seller. Here’s what you should know before you shop.
The Pros and Cons of Buying From a Private Seller
Pros of buying from a private seller:
- Easier negotiation: Private sellers are often highly motivated because they need to sell their current car in order to have the cash available to buy a new car.
- Lower prices: Dealers pay to prepare the used car for sale, advertise it, and pay the salesperson a commission. Private sellers don’t have these costs, so they’re not passed on to you.
Cons of buying from a private seller:
- Fewer protections: You won’t have the backing of a dealership if your new-to-you car is a lemon. Dealerships sometimes include short-term warranties or money-back guarantees. They also only sell cars that are in good condition.
- Lower sense of security: There’s always a risk when it comes to meeting up with a stranger to buy property from them.
- More complexity: Dealerships handle all the necessary paperwork for the sale of a used car. If you buy from a private seller, it takes a bit more work on your end.
How to Inspect and Price a Car
When evaluating a used car sold by a private seller, it pays to be extra vigilant. Take these steps to protect yourself and your money.
- Do your research: Get the Kelly Blue Book value for the car you’re interested in buying. This can provide a starting point for your negotiating.
- Meet with the owner in a neutral, public place during the daytime: Avoid meeting at their home or yours. Daylight allows you to better inspect the car and notice things like collision or water damage. Don’t bring enough cash to purchase the car as it’s unsafe to carry such a large amount. If you’d like to buy the car, use a money order or cashier’s check. (Financing a car sold by a private seller is possible but more complicated, and you’d likely be charged a higher interest rate.)
- Test drive the car: Listen for any odd sounds. Turn on the air conditioning and heat. Check the brake responsiveness and, if the car has a manual transmission, shifting smoothness. Drive over speed bumps or on bumpy roads to test the suspension. Avoid chatting so much with the seller that you ignore or don’t notice major issues.
- Take the car to your own mechanic: Have them thoroughly inspect the car for damage, potential maintenance issues, and even signs that the seller is covering up prior damage. Don’t use a mechanic the seller recommends.
The Necessary Paperwork
- The car’s registration and certificate of title: Make sure the seller’s name appears on both, which means the car actually belongs to them and they have the right to sell it. Don’t buy a car if the seller doesn’t have the title! This is usually a sign that the car was stolen.
- A CarFax report and the car’s service records: Get a record of all damage and repairs.
- The car’s owner’s manual and keys: Make sure you get all copies of the key!
- Retitling the car: You do this at the DMV after you purchase the car. You’ll officially become the car’s new owner and will pay sales tax on your purchase.