Used cars for sale: Savvy customers avoid depreciation

Used cars have an image of being lesser cars with high mileage and iffy reliability. No longer, say dealers.

Despite all the market fluctuations, price is the main reason you choose used over new.

Mike Magill of Johnson Motors in Massillon, Ohio, says, “Customers understand how quickly new cars depreciate and are looking to lessen that cost.”

Most cars of any type are financed. Leasing is an option few used-vehicle customers take.

That makes financing a critical part of deals. Dealers report financing is easier now than last year due to the lessening depression. Rates are stable and similar between lenders.

Dave Green at Belknap Used Cars in Canton, Ohio, serves the low end of the market, vehicles in the $2,000 to $3,000 range. The problem here is while credit once was easy for lower-income customers, it’s tight now.

“We sell ‘buy here, pay here.’ That means the dealer finances the car and does not use an outside financier,” he said.

Dealers have found that cars are much more reliable today. This is confirmed by Consumer Reports. A 6-year-old used car with 50,000 miles on it still has a lot of life.

Howard Cruz of Jeff’s Motorcars in North Canton, Ohio, advises, “Remember that cars now are better quality, built better. Look for cars that still have warranties or service contracts in force.”

An example of better quality is rust -- or the lack thereof. Cars do not rust out as fast as they once did. That’s due to makers using galvanized steel and advanced painting methods. The days of having to undercoat a new car are past.

Tad Ries at Rankl & Ries in Canton sees late-model vehicles as a way to economically “upgrade your transportation.” The deepest depreciation already has happened. “This is a solution for many buyers.”

A PRE-OWNED PRIMER

1. Select a dealer with a good reputation. A good way to find one is to ask your friends.

2. Research car models that interest you on the Internet. Check for recalls. Consult Consumer Reports for average reliability and cost of ownership, including gas costs.

3. When you find a car on the Internet or on a lot, check the Kelley Blue Book for its retail value, including age, condition and mileage. This is available free at www.kbb.com.

4. Research vehicle loans from a variety of sources, including credit unions, banks and individual dealers. Note that your credit score will determine your rate.

5. When you find a likely car, inspect it for rust and damage. The tires should be wearing evenly. Look at the joints between body parts. Gaps indicate a repair. Look for evidence of repainting, such as a different color under the hood.

6. If you are unsure, have the car inspected by an independent mechanic. This may cost you $35 to $60, depending on time.

7. The test drive is critical. Check the steering alignment and brakes. Listen for engine noise. The clutch and transmission should be smooth. Accelerate onto a freeway. It should be without hesitation.

8. Consumer Reports suggests that buying extended warranties may be worthwhile for cars out of warranty that have high mileage. Note that some cars come with warranties provided by dealers or have factory warranties still in place. Warranties are transferable between owners.

9. When you make the deal, seek a return privilege. Depending on the condition of the car, this may be an option.

10. Note that cars are sold “as is,” but responsible dealers safety check and make repairs. The National Automobile Dealers Association recommends buyers ask for a vehicle history report. Otherwise, according to Lem Sims of the association, “You could be buying a vehicle with safety issues or other issues. You could end up in a spider web of declining value.”

The Repository