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Misadventures in Shopping For a Used Car

buying a used car with a rebuilt or salvage title

Hidden gem or money pit?

I used to love shopping for new cars. We did it fairly often back in day. It was really easy to see a car we wanted, walk into a dealer, trade whatever car we had at the moment, sign up for payments, and drive away. I don’t believe we ever tried to negotiate, at least not that I remember. Yes, it was a bit unnerving to deal with salespeople, but I knew we’d get approved and leave with a shiny new car eventually. This time around, we are shopping for a used car, and I’m  having all kinds of anxiety!

New Cars Are a Rip Off

After actually shopping around, it’s amazing to me that a new 2015 car costs $5000-$10,000 more than the same used model with less than 30,000 miles. We are mainly looking for Toyota or Honda used cars, so under 50K miles is practically like new. There are tons of barely used vehicles out there that sell for way less than new cars.

One example we saw is a 2011 Honda Civic LX with only 23,000 miles. It is a one owner car that was traded for a new SUV. What do you want a bet it was because of recent low gas prices? I hate to judge because that was me at one point, but it makes a person striving for FI cringe to see people trade up a practically new car for an even newer gas guzzler!

Are Sales People Not Nice to Used Car Buyers?

Every time we’ve gone to the new car lot, a salesperson has magically appeared within 60 seconds and stuck like white on rice throughout the whole visit. When looking at the used section, I’ve found that the service is certainly less “helpful.” In a way, I don’t mind because I don’t enjoy sales people for the most part, but when you have to go inside and search for someone to get a price, that’s a bit annoying.

Maybe it was because it was cold and close to the end of the day, but the salesman didn’t seem very enthused at all about our presence. He didn’t even ask for our names or offer us a test drive! I guess as we look at more vehicles, I’ll see if we just got a lazy one or if this is a trend. Maybe new cars are selling so well right now that salesmen don’t want to be bothered with the used set?

Are Rebuilt Titles a Good Deal?

We’ve run across a couple of cars being sold on eBay with rebuilt titles. They are both from dealers and have been inspected as in good condition. The prices are much lower than clear titles, but I don’t know if rebuilt titles are a good buy or not. IT seems opinions are mixed. Some reviewers would never buy anything but rebuilt while others say not to touch them with a ten foot pole.

I wonder if it’s similar to buying a distressed real estate property vs something that’s move in ready?  It would suck to buy a car that had mechanical problems, but it would be awesome if we got a like new car for almost half price.

It seems the other cons would be in resale value and insurance. In our case, resale value is irrelevant as we intend to keep this car for many years. In Colorado, it seems rebuilt titles are not a huge deal and our insurance company offers full or liability coverage that isn’t any more expensive than for a vehicle with a clear title.

Some states are not as lenient. If you can’t insure it or if the insurance is really expensive, that would certainly negate the cost savings. Has anyone had experience with rebuilt titles?

eBay, The New Way To Buy A Car?

We’ve been looking daily on eBay for cars that match our criteria and have actually put in a few bids but haven’t won anything yet. It seems kind of ridiculous to buy a car sight unseen, but I really like being able to get feedback about the sellers. I love not having to deal with an actual salesperson.

I was the winning bidder in one auction from a private seller when the listing abruptly ended for some reason. My guess is they found a local buyer. It is frustrating to say the least, but maybe we’ll get lucky at some point. At least we don’t have to haggle!

 I’m Still Scared of Craig’s List

I have searched Craig’s List, but it seems the most risky place to buy a car. At least with eBay there is some sort of guarantee against fraudulent sellers. I also hate the idea of carrying a wad of cash out to meet someone I don’t know. I know tons of people have bought and sold on Craig’s List. I just have a hard time going there. Maybe I was ripped off in a past life?

I Think I Am Damaged Goods

I am trying to understand how it’s easy for me to buy a $185,000 property, but I can’t seem to get my head around a few thousand dollars for a car. Maybe it’s because I know the car is a loser asset that, while necessary at this point, does not really help us get to the place we want to be.

We actually considered a low interest car loan so that we could keep our money in other investments, but the thought of a payment makes me ill. Besides, the lowest rates are generally for new cars, and we are certainly not going there.

I look back at how much my attitude toward spending has changed since we bought our last car in 2007. It’s positive all the way around because we are determined not to waste more money that we have to this time. It also is making it very hard because we can’t seem to decide what we want to do and when to pull the trigger!

Any tips for used car shopping? 

About Kim Parr

Kim Parr is a private practice optometrist, freelance writer, and personal financial blogger. You can follow her journey to 20/20 financial vision at Eyes on the Dollar.

31 comments

  1. Don’t be scared of Craigslist! We get most of our cars from there when we have cash to use and don’t want to finance. Just make sure you either bring someone car savvy with you or request to take it to a mechanic to have it checked out before you move forward with the purchase. If you’re only going a few years old you should be fine, not as much can be wrong as if you go 10 years old and find out they didn’t take care of their car. 🙂

    • I did actually call one of the ads on Craig’s List, but the car was already gone. Most of them are over 4 hours away from us, so I can’t take them to a mechanic. Being able to have several choices nearby would be one advantage of living in a city.

      • Having a mechanic check over the car you might buy is really key to purchasing a used car. So it’s really a bummer that you apparently are logistically prevented from doing that. An alternative which has worked for us could be getting a CarFax report on the car. Another, if you are buying from a dealer, is to get a 30-day or somesuch moneyback guarantee and take the car to your mechanic after you’ve bought it.

        Don’t be afraid of an older car. My vehicle is a 1996 Dodge Dakota and my wife’s is a 1998 Subaru Forester. Both obtained after the cars were 10 years old. Both have performed like champs. And we’ve saved a boatload of money that we used to accelerate our arrival at an earlier retirement.

  2. I’ve not heard of rebuilt titles. Though, Nebraska is so backwards when it comes to cars that I’m sure it’d be a challenge for us. We actually sold our last car through Ebay – to a local kid and it was a great experience for us. That said, I don’t know that I have any tips…my wife informed me last week that I’d be handling everything for our next car purchase next year. 🙂

    • Jim hates car shopping and sucks at haggling. I’m not great, but I’m better than him. He doesn’t even want to go until I work out all the details. Hopefully, this will be the last time for at least a decade that I have to do this.

  3. I hate car shopping! We may go down to one car once Greg starts working at home next month. I can’t imagine why we would need two- we barely need two cars now. Good luck with your search! No tips here.

    • My ultimate goal is to live somewhere I can walk or bike everywhere and not need a car. I envy you for not having to drive very much.

  4. Hmm, it’s pretty straightforward and I think its a lot easier now because you can look up a car’s history online and see if the sellers are being honest. I don’t like car salesmen in general, but went there when I was car shopping just to test drive different models…but in the end bought from a private seller for a very good deal!

    • i think if you can find what you’re looking for, that’s probably the best way to go. No stack of paperwork or crazy managers running around!

  5. We had a similar experience with used car shopping, the salesmen had a very low pressure attitude. We noticed that prices were pretty much the same everywhere. Either the price was low and it was what we saw or it was high and they took thousands off if we asked if they could do a deal. Buying a house is much easier for me to do too for some reason!

    • I hate haggling about as much as anything. At least with a house it’s all done through a realtor and there are layers built in. When you have to go head to head with a salesman, it’s a different experience altogether.

  6. Hey Kim,

    Be careful of rebuilt title cars. The only reason is they usually were salvages (considered complete loss), but then were rebuilt. How were they rebuilt? What was the extent of the damage? Was the frame messed up and how was it aligned? The biggest problem with them is they are very hard to get insured.

    • I think we’ve given up on that idea after talking to a friend. She bought a salvage/ rebuilt car which looks and runs great, but there is obviously some frame damage because it goes through tires like crazy. Also, I bought the VIN report for one car that was listed as only having a door replaced. There were pictures in the report, and this car was demolished. Besides the door, the hood, front and back fenders, another door, and a bunch of stuff under the hood was replaced. No seller is probably going to tell you that.

  7. I hate the whole car buying thing as well because it really is a loser of an investment of your money no matter how you look at it. I lease my car which is not the best solution, but it’s also part of my business expenses so it works itself out.

  8. One of my friends actually bought her car through e-bay. It was a mixed experience. The car was fine and she had no problems with the seller. She bought a convertible (the old California dream) and soon discovered that it wasn’t nearly as fun or practical as she imagined. While there is no guarantee she would have figured that out during the test-drive at a local dealer, she might have. So I think that would also be my concern with e-bay, no being able to drive the vehicle. I’m not a huge fan of car shopping either. I replaced my car a little over a year ago, so I should be set for a long time. Fingers crossed. 🙂

    • I think the thought of a convertible is probably much better than the reality. I do like being able to test drive a car, even if I’ve already driven that particular model at another place.

  9. We had to do this back in September. We were in an accident two weeks before I left for FinCon, so it was harrowing.

    In the end, we ended up with a 2012 Honda Civic with 24,000 miles. We paid around $13,800 including all taxes and with a broken car trade-in. I pray this car lasts a long, long time because I *hate* car shopping.

    We actually had a pretty good experience with getting help on used cars, so I guess we got lucky.

    As for buying off Craigslist, my mechanic told us that he inspects potential cars for his customers for free. I’d find out if your mechanic will do the same. It could make it possible for you to buy from CL without cringing.

    Also a good idea is to look for cars from neighborhoods filled with older people. Not to stereotype, but most of them don’t drive as much, so the cars have fewer miles, and they’re more prone to keep up on regular maintenance than a younger driver.

    • A huge downside of living in a small town is that the Craig’s List cars are so spread out. We don’t have time to drive up to Denver to look at cars. I actually had a good salesman today when I went looking, so I guess I just got a dud that first go round.

  10. In all honesty I do most of my car “shopping” online through cars.com. The past three cars I’ve bought (and one was for my wife – that makes it sound like I buy cars all the time!) I had already hand-picked the car before even going to test drive it. I also price-check it on Kelly Blue Book and run the CarFax before ever leaving my home. It’s weird used cars salesmen aren’t as helpful. I was told by a marketing profesosr that they can make a better margin on used cars because new cars are all (at least the same models) exactly the same so there is no wiggle room for them to build in anything but a set margin.

    • I had a much better sales experience with my second and third trips, but I did call ahead to let them know I’d be coming. Maybe the first guy was just having a bad day.

  11. On a related subject, I’m trying to decide whether to take advantage of our local Honda dealer’s “Xchange” program, where you can trade in a slightly used Honda (around three years old) for a similar new model with the same or possibly better monthly payments. I know they’ll be screwing me — either on the price of the new car or the trade-in value on the old one — but I haven’t been able to pin it down. To me, the bottom line seems like a lease deal: Get a new car every three years, but without the down payment and without any mileage restrictions. BTW, we do practice fiscal responsibility in all other ways — saving, living beneath our income and putting away enough to retire early and comfortably. This is our only indulgence. My wife is afraid that a car over three years old will leave her stranded on the side of the road.

    • My parents are the same way. If their car gets to 60,000 miles, it’s time to trade! I think they can always make a payment fit whatever you’re willing to pay. I’m just done with car payments forever. I promised myself after paying off the Altima almost 5 years ago that I’d never have another. I know it makes more sense to invest your money if you can get a low interest car loan, but I just can’t do that payment thing. It’s my line in the sand!

  12. Do you have a mechanic that you trust in your area? I know you mentioned that there aren’t any used cars in your area, but a mechanic you trust could give you recommendations for places in other cities.

    FWIW, I did buy my first car off Craigslist (the car I currently have I bought new). I brought along my dad, who is Really knowledgeable about cars. We also looked on car forums to see what problems owners were commonly trying to address/fix- which helped a LOT. It turns out the original part in the ignition for these cars (Ford Focus) wore out, but was an easy and cheap part to fix. Meanwhile, the closest and best deal to me was a Focus with ignition problems- so I saved money 🙂

    • I have a friend who is pretty good at fixing cars, but he never gets new ones because he can always fix whatever is wrong. I’m not sure he’d be a great help with newer models!

  13. My fiancé and I have been discussing buying a used car, as both of ours are older and his is basically on the way out (check engine light is giving off a bad code). I got my car off of Craigslist, but I brought my dad along as he’s car savvy. I don’t blame you for not going that route when they’re so spread out!

    I’ve been looking at the inventory on dealer websites and I’m a little bummed at the prices I’ve seen here. Seems like anything under $10k is around 2004-2008 with over 100k miles, and we didn’t want to go that old as we’re hoping this car will last a long time. Needless to say, I’m not enjoying the process and we’ve barely started! I guess I have to adjust my expectations. We’ve also seen quite a few rebuilt titles; I’ve heard the damage is sometimes just cosmetic, but I’d rather not risk it. Looking forward to hearing more about your experience!

    • We decided not to go with a rebuilt title. I’ll be sharing more next week, but I think after looking for a few weeks, you just get burned out and want it to be over with.

  14. I once bought a car that was wrecked. It was actually two cars pieced together when done. The loan paid for the entire deal, purchase of $2500 and repair of $3500. And it was still under warranty.

    It worked for me.

    And I have always bought new since. You get trouble free miles, that’s why new costs so much. Everything is under 100% coverage warranty.

  15. Great article Kim! I advice you to always do background research ahead before purchasing just to assure the seller isn’t tricking you. Also, never trust everything the seller says unless it is proven true. You can always decline if you notice defects.

  16. Hey Kim,

    As I think people should buy used car in rare case otherwise they should focus to buy a new one. I agree with your all point of views on purchasing used car. But, it doesn’t matter that how the people need to have a car.

    You have written very well and hope it will be loved by all. Since many people are unaware about such great tip before buying a used car, you have suggested very well.

    Thanks a lot for sharing.
    Have a good day ahead.

    – Ravi.

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