9 Tips to Protect Yourself When Buying a Second-Hand Car

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Tips to Buying a Used Car | MoneyMax.ph

You’ve decided to purchase a second-hand car, and you’ve started to hunt for the right used car for you. The next steps will be a lot trickier than the car buying decision. Of course, you want a vehicle in the best condition possible at the lowest price. Just because you’re buying a second-hand car doesn’t mean you’ll settle for a huge piece of junk, right?

So you won’t end up regretting your purchase, be very meticulous and careful when buying a pre-owned vehicle. Here are some tips you need to know before buying a second-hand car.

1. Research Your Options Extensively

Tips to Buying a Used Car | MoneyMax.ph

Before contacting sellers, make sure you arm yourself first with enough knowledge about the used car model you want to buy and its price range.

Ask for pointers and leads from your friends and colleagues who bought a second-hand car. Join car forums, especially the ones that focus on your target make or model, and ask questions. Check out the used car listings on car classifieds on newspapers and websites to know how much your preferred model costs.

2. Compare Used Car Prices

Photo by Xb100 via Freepik.com

Photo by xb100 via freepik.com

As you browse through different buy-and-sell websites scouring through second-hand cars for sale, make a price comparison of the model you want to buy. Also, check out the specs of the lowest-priced units—they might have higher mileage or they might be older year models.

Planning to purchase a second-hand car through an auto loan? Compute first how much you’ll be paying for the interest and compare how much it will cost you versus paying the full amount in cash.

3. Check the Mileage, Too

Tips to Buying a Used Car | MoneyMax.ph

During your research, don’t focus only on the prices. The cheapest used cars aren’t necessarily the best ones to purchase—they typically have higher mileage. The higher the mileage is, the older the car is. The older the car, the more parts you have to replace.

So be sure to check or ask the details on the mileage of the car you’re considering to buy. Avoid those cars with a mileage higher than 60,000 km. because these units’ parts are likely to be worn out.

To verify a car’s mileage, pay attention to the pedals and steering wheel during your vehicle inspection. Their condition can speak volumes about the real age of the car.

4. Set a Reasonable Budget for the Second-Hand Car

On top of the car’s purchase price, set aside an amount for the repair and replacement costs that will prep the car for the road. TopGear columnist Andy Leuterio recommends allocating at least 20% of the used car’s price.

For example, set a budget of PHP 100,000 for fixing a second-hand car worth half a million pesos. This way, you’ll spare yourself the stress of taking out cash from your wallet each time a component of your newly purchased vehicle breaks down.

5. Dig Deeper into the Car’s History

The biggest risk of buying a second-hand car is its history. It may have been stolen, involved in a crime, met an accident, or flooded. How will you know about the service history of a pre-owned car? Here are some ways to find out.

  • Check the car’s Certificate of Registration (CR) and Original Receipt (OR) issued by the Land Transportation Office (LTO). Make sure that the vehicle details on these documents are consistent and correct. The seller or former owner of the unit should provide copies to you.
  • Ask for the anti-carnapping clearance issued by the PNP Highway Patrol Group.
  • Verify if the car has a bad record in the LTO. Simply text LTO<space>VEHICLE<space>PLATE NUMBER to 2600 (e.g., LTO VEHICLE ABC123). This text service, which costs PHP 2.50 per message, will send you relevant details about the car, such as its year, make, and model, registration date, color, and if it has any LTO apprehension or alarm.

6. Check the Used Car Thoroughly for Red Flags

Tips to Buying a Used Car | MoneyMax.ph

Never agree to buy a used car without doing a thorough inspection yourself. Be as meticulous as possible—check not just the body but also every nook and cranny. Look for red flags that indicate that the car has been involved in an accident or flooding.

Some warning signs to look out for:

  • Filler on the engine block
  • Inconsistencies in the paint quality
  • Touch-ups that cover scratched or bent parts
  • Components that don’t work properly
  • Mismatched tires

Not confident with your vehicle inspection skills? Take the car to a trusted mechanic and let him do the job for you.

7. Never Skip the Test Drive

Tips to Buying a Used Car | MoneyMax.ph

Did the car pass your visual inspection? Good! The next step is test driving the unit. Insist on driving the car for a test—if the seller refuses, just walk away. You don’t want to waste your hard-earned money on a car that’s cheap but will cause you headaches in the long run.

Refer to this full checklist when test driving a second-hand car.

8. Negotiate a Fair Price

Tips to Buying a Used Car | MoneyMax.ph

A full inspection and test drive should give you an accurate idea of the used vehicle’s condition. With that information, come up with a price to be negotiated with the seller. Raise your chance of getting a lower price by pointing out the red flags you discovered while inspecting and test driving the car.

9. Don’t Forget to Insure the Car

If your newly purchased second-hand car doesn’t come with an insurance plan, you’ll have to buy one on your own before you take it out for a spin. Used cars, like brand-new ones, aren’t exempt from accidents that can drain your money if yours isn’t insured.

To find the right car insurance policy and save on costs, compare car insurance rates at MoneyMax.ph!

Final Thoughts

Now over to you—what other tips can you share about buying a second-hand car? Leave a comment below!

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About Venus Zoleta

Venus Zoleta is a personal finance writer who started investing and bought a home in her early 20s. This crazy cat mom works hard to feed her furbabies. She eats ramen like there's no tomorrow. You can reach her on LinkedIn (bit.ly/2yFSlhE).