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How to Shop Smartly for Used Cars

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In the market for a new ride? If you’ve been comparing prices on the car of your dreams, you already know by now that buying a used car can save you a lot of money. Not only are used cars cheaper, but you’ll likely save money on things like insurance as well.

With better and more accurate vehicle history reports, finding a reliable used car is easier than ever. Yet buying a used car isn’t automatically a better deal. To help you save the most money possible, keep these considerations in mind:

  • Do your research. Before buying the used vehicle you have in mind, do a little digging about its numbers and its past. Start by looking up the car’s true market value. This figure will help you tremendously in determining an accurate value of used cars on the market and during negotiation process. Secondly, be sure to pull the car’s vehicle history report. While it may seem like the car is in good shape today, it’s worth knowing more about the car’s history - including whether or not the car’s odometer has been rolled back.
  • Figure out your budget. Before you run off and apply for a car loan, you’ll need to figure out just how much car you can actually afford. How much are you willing to put as a downpayment on the car? What kind of monthly payment can you afford? Figuring out these two numbers will help you determine what kind of loan (and car) you can afford to buy.
  • Secure your financing beforehand. Finding a way to finance your car outside of the car dealer will give you a huge advantage and could save you a lot of money in fees and interest rates. By asking a bank or credit union for a car loan instead of the dealer, not only do you have more control over the transaction, but you could secure a more competitive interest rate.
  • Negotiate. If there was ever a time to negotiate, it’s when buying a used car. Whether you’re negotiating with a dealership or an individual, you’d be surprised how flexible the asking price is - all it takes is the right strategy and a little patience. But not every negotiation goes smoothly, so always know when it’s in your best interest just to walk away.

About Stephanie Halligan

Stephanie is the founder of The Empowered Dollar, a site dedicated to helping millennials to fix their finances and find their stride in money and life. When she's not blogging, Stephanie is designing school curricula and online games to teach students about smart money management.

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