Identify your budget:

You want to pay cash or finance the vehicle in 3 years or less. Any longer and you pay too much in interest.

Identify the features and functions you’re looking for:

Just because it looks nice, or everyone says it looks cool, or is the latest fad does not mean it is going to work for you. I am 6’ 7” and I had a Red Chevy Camero IROC at one time and I loved the sports car look, but after squeezing myself into it everyday for 8 years I was extremely happy to move up to the Ford Explorer SUV. Take a hard look at what you need because the only way to make a car really pay off is to hold it for 6 or more years. The longer the term the cheaper it will be.

Identify your make and model:

Many online websites such as edmunds.com show you pictures, descriptions, mileage, size and other vehicle characteristics for quick and easy comparison. Additional pictures can be obtained from autotrader.com. Take into consideration foreign versus domestic. Domestic high production vehicles have far greater parts availability and at a lower cost than your foreign competitors. Finding a mechanic to work on a Ford Taurus or a Chevy Blazer is easier than finding a mechanic that has experience with a Mercedes Benz.

How much should a car cost:

If a dealer is selling a car for $20,000 that means he paid some private party or auction house $12,000 to $14,000 for the vehicle. A dealers profit on a used car is typically 30-40%. Used cars are more profitable than new cars to a dealer. You should always try for between 20-30% off dealer price or only purchase from a private party. There is no guarantee that you won’t get a lemon from a dealer versus a private party.

The telephone interview of a private party:

The first question to ask is always “The car looks great so why are you selling it? Take note of the answer because you will ask it again at the inspection. For those that have a different answer take note because odds are they are hiding something. People have a hard time keeping stories straight. Ask other questions about there driving habits. Do they drive a lot of freeway miles, or city driving? City streets are hard on a car. Next ask what they like about the car, and then ask what they don’t. At the end of the conversation ask when they might be available to show the vehicle.