How to Buy a Bargain Used Car

OK Used Cars neon sign in VABecause of my knowledge about cars, I get asked this question all the time: “What is the best used car?”

People being people, they want an answer like, “A 2011 Mazda6”. Because that’s the way people are. Everyone likes something they don’t have to think about too much, right?

But, of course, it’s not that easy. First off, there is the question of what you’re going to use the car for. If you have a 45-mile commute to work every day, no matter how nice that used Chevrolet Suburban is, it’s probably not the “best” used vehicle for you. And if you need something to carry around three teenage sons all the time, and by the way, they’re all on the football team at school, a pristine, low-mile, attractively priced, one-owner VW Beetle is probably not the “best” used car for you, no matter how much of a deal it is. Or, if you’re on a very tight monthly budget, a used BMW 7-Series, no matter how nice it is, and how well it’s been looked after, is probably not the car for you. You can afford to buy the car, but when something goes wrong with it, you will faint when you get the shop bill, and will have to decide between paying your mortgage that month, or, getting the exhaust system on your car repaired.

Then, there’s the question of the car’s history. A Honda Accord is a dependable car, but if you’re buying one that’s got 40,000 miles on it, and it was used to tow a trailer for 23,000 of those miles, you should probably run, not walk away from that deal. Transmission problems will be an always-constant possibility with that car. Same approach applies if the car has been in a bad accident, or in a flood, or a fire, etc. There are going to be problems later. You never want to buy someone else’s problems. Or potential problems. A Honda Accord is generally a good choice, but this particular, hypothetical Honda Accord we’re talking about right now would be a very bad choice.

Now, let’s be even more discerning.

Let’s suppose that you, like a lot of people, not only want a great used car, you want a bargain used car. That, to you, is how you define “best used car”. How do you figure out how to buy a bargain used car if you’ve already figured out all the variables above?

Well, you could wait for that nice elderly couple that lives near you to sell their cherry 2005 Toyota Avalon with only 37,000 miles on the clock because they want to get something newer. They seem to like you, so they might sell it to you pretty cheap. Maybe.

Or, you could simply scour Craigslist and Auto Trader online for what seem like good deals, and spend a month driving to people’s houses and different car lots in the evenings and on the weekends to look at 2011 Subaru Outbacks that were priced lower than average for some very good reason. That’s time-consuming, though, and your personal time must be worth something.

You could go to a dealer and engage in a knock-down, drag-out negotiating session with the used car manager for a Dodge Charger on his lot. Of course, you should bear in mind that he does that 50 times every week, and you do it once every five years, and he’s probably a lot better at it than you are.

“How to buy a bargain used car” is actually easier and quicker than all this.

Every year, there are models of cars that flop in the marketplace. They just don’t catch on, for whatever reason. They’re good cars in terms of mechanics and durability, but for whatever reason, the buying public does not embrace these vehicles. This makes their residual value as used vehicles drop like a lead weight. Which means you can buy a three year-old perfectly good car for much less than a three year-old perfectly good car that was a popular model sales-wise.

Toyota Venza

Toyota Venza

Let me give you an example, because examples always help. The Toyota Camry is a very durable (if boring) car, a perennial best-seller, and holds great value as a used car. The Toyota Venza, introduced in 2008, and being discontinued this year, is a crossover based on the Camry platform, with the same engines and transmissions as offered in the Camry. It’s basically a much taller Camry, with lots more utility and lots more cargo room. In fact, because of this, many people refer to it as the Camry station wagon.

Toyota has never been able to sell very many Venzas. The Venza has been a monumental sales disaster since the 2008 debut. Which is why they’re yanking it from the market this year – Toyota can hardly give these things away. But, it’s a good car, certainly every bit as good as a Camry.

Here’s the payoff: A 2012 Toyota Venza that has the same mileage and the same options, and is in the same condition as a 2012 Toyota Camry, will go for thousands of dollars less than the Camry. Thousands of dollars less. For the same-quality vehicle. Why? Because it’s a dog from a sales perspective. But not from a quality perspective, and certainly not from a value perspective, since the price will be so much lower.

There are many models of cars like this out in the marketplace – cars that are good or great cars, but for whatever reason, were not popular as new cars, and that makes their value as used cars drop much more quickly than other cars of the same year of manufacture. These are the bargains you should look for.

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