Friday, August 24, 2012

Buying a used car in USA

After recently moving to USA, I decided to buy a used car (on a student budget!). Initially, it seemed to be a very simple task. Go through online listings, filter out according to price and other preferences, test drive and make a decision! Last time I bought a car in USA, was 10 years ago. Apparently, a lot has changed since then.

There were several websites I was recommended to check out. Some of the top ones being CarSoup, and of course, Craigslist! As it turns out, CarSoup and have a charge to post a listing. This causes most private sellers to avoid it. Most of the listings on those websites were from dealers. Since I was looking for an old car, there was no warranty on the car from the dealer, and their lowest prices were higher than similar models being sold on Craigslist by private sellers.

Craigslist turned out to be the best resource. I narrowed the cars listed according to the price filters and that they have to be Japanese made. Since I was looking for an old car, I could only trust a Japanese car to last me a couple of years without additional expenses. This narrowed it down to Honda, Toyota and Nissan.

There were quite a few listings for me to choose from. The question was, how to go to different sellers in different parts of the city without a car. So, I needed a car to buy a car! Fortunately, my fraternity brother, Cory, was generous enough to let me borrow his extra car until I could find one of my own!

I started calling up sellers on Craigslist and setting up times to go check out the cars. When I actually drove to each one of those places, I realized that driving 30-40 minutes was the norm. To look at each car, driving such distances was exhausting. Could only check out 2-3 cars a day.

It felt good to have so many options to choose from. Then I went ahead and got a CarFax membership for unlimited reports for $55. When I went to check out those cars, I realized there weren't as many options as they seemed. Most of the nice cars that I liked either had been salvaged, or had been in a major accident!

Finally, I came across a Toyota Camry which had a smooth drive and no problems in its CarFax report either. Only problem was it had a 'Check Engine' light coming on. I decided to get it checked by the Toyota dealership nearby. They charged $135 just to have a diagnostic check! This car buying was turning out to be an expensive proposition, and I hadn't even bought it yet.

When I got the report, turns out the car requires a new catalytic converter and some other things. The repairs would have costed almost $1,000. Since I liked the car so much, I was willing to buy it for $500 less than the price agreed upon. But the seller was not interested. Back I went into looking at Craigslist listings.

Then I got a call from my friend whose mechanic had a couple of cars he wanted to sell and suggested I have a look at them. This mechanic came highly recommended. A few of my friends had been going to him for more than five years and trusted him a lot. I figured if I buy a car from him, at least he will take some responsibility for any problems that arise later.

He showed me a Ford, which I immediately rejected. Then he showed me a Honda Accord which had a minor accident and he agreed to fix it before selling it to me. The demanding price was also well within my budget. It had a clean CarFax report, except for the minor accident which he was working on. We negotiated on the price and I agreed to pay him the money and pick up the car after two days. When the time came around, he asked to raise the price by $200 because we had so strongly negotiated the price that he couldn't afford to replace the bumper with a new one.

Since we knew that even with the extra $200, it was within my budget and below market value, we agreed on it. After another couple of days, the car was ready and I was finally the new owner of a Honda Accord!

As it turned out, despite going through all the online research and different websites, I ended up buying the car from a friend's mechanic. In hindsight, the online research and checking of different cars was necessary. Otherwise I would have never known if the price he was asking was reasonable or not.