Used vehicle buying guide: what you need to know

Transcription

1 Used vehicle buying guide: what you need to know

2 Finding the right used vehicle for your needs and tastes takes time and energy. But it can be a great way to save money, as long as you do your research and choose carefully. So, where should you start? 1. Do your homework... 1 What kind of factors can decrease a vehicle s value? Reliability and longevity 2. Where to buy a used vehicle... 3 From a merchant or dealer From a private seller 4 questions to ask the seller Legal protection 3. Beware of curbsiders... 7

3 1/ Do your homework If you re looking for the perfect vehicle at the right price, you ll need to do your research and shop around. There are plenty of good sources of information available, including car columns, automotive websites, newspapers, magazines and vehicle guides. These sources will give you a better understanding of what s available on the market. Use them! They ll also help you understand vehicle values, and how factors like the year model, equipment and odometer reading affect these values. Your research will arm you with the information and arguments you need to negotiate the price once you ve chosen a vehicle. The Canadian Black Book is another great source of information that can give you an objective idea of a vehicle s trade-in value. A number of different factors affect how much a vehicle is worth. To learn more, read the article Three values that determine used vehicle prices. ONE

4 What kind of factors can decrease a vehicle s value? Supply and demand If a vehicle is in high demand, its price will be higher. And if there s little demand for a certain type of vehicle, its price will be lower. So there are opportunities to save money by looking at widely-available models and also less popular models. Colour The colour of a vehicle certainly has an impact on its value. The most common vehicle colours are black, white and grey. You may be surprised to learn that orange, yellow and green vehicles depreciate the least. These colours are rarer, meaning interested buyers have fewer options to choose from and prices are less negotiable. At the same time, it can be easier to negotiate a price drop for less common or less trendy colours, since the seller might have trouble finding a buyer. Again, it boils down to supply and demand. Equipment Choosing a manual transmission can save you over $1,000 on some recent models. Extras such as heated seats and a sun roof also increase the value of a vehicle; if you think you can live without them, expect to save a few hundred dollars. Depreciation Depreciation can translate into big savings for people who want a nearly new vehicle for less. Experts say that a new vehicle loses 20% of its value as soon as it leaves the lot. After that, it loses 12% to 15% of its value annually. The value also takes a hit when the manufacturer s warranty runs out, typically after 100,000 kilometres or 5 years. For savvy buyers, this can be an opportunity to pay less for a vehicle that is almost new. Reliability and longevity Contrary to popular belief, today s vehicles last longer than those built even 20 years ago. Vehicle reliability has come a long way. An 8-year-old car is not necessarily at the point of falling apart. A vehicle that has 150,000 kilometres on it could be a good deal it s at the middle of its lifecycle and should still be good for several years to come. So buying a used vehicle with a high odometer reading can actually be a good deal if you re looking for a reliable car and want to save a few hundred bucks. A few things to keep in mind: Japanese vehicles tend to retain their value better over the years than other brands. And higher odometer reading has less of an impact on the price of pick-up trucks and vehicles with diesel engines. TWO

5 2/ Where to buy a used vehicle a. From a merchant or dealer The difference between merchants and dealers is relatively minor the same requirements apply to both. If you decide to buy from a merchant, you ll have a wide range of makes and models to choose from, all in the same lot. It s important to note that in Quebec, merchants are required to include everything except taxes and levies in the posted sale price. No other fees can be added, unlike in other provinces. Dealers, meanwhile, tend to specialize in one brand, meaning they are experts on the models they sell and can help you choose between two similar products. Remember that dealers usually have lease returns in stock as well. Dealers know more about the lifecycles of their vehicles and the various problems that may surface over time. This information can help you compare prices more objectively and understand price gaps between models. Unlike private sellers, both dealers and merchants are required to offer you a warranty. Dealers and merchants must disclose any problems with the vehicle and the cost of having them repaired. This information can help you make a decision. Finally, since they are required to offer after-sales service, dealers and merchants are able to follow up on the sale and answer any questions you may have. While going through a merchant or dealer can offer peace of mind, you should still read the contract carefully before signing. Make sure it reflects everything you have been told, since it s very hard to modify your contract after it s signed. THREE

6 b. From a private seller Generally speaking, you can get a better price when you buy directly from a private seller instead of a merchant. That s because private sellers rarely recondition vehicles before selling them. And since they re not merchants, they don t have to offer a warranty or charge taxes. That said, you will still have to pay provincial sales tax at the vehicle registration office when you transfer the vehicle s ownership. Warning: If there is a latent defect, it s hard to sue a private seller, so make sure to properly inspect the vehicle before buying. Here are some tips for private sales: 1. Do your research Do you have a specific model in mind? Research its weaknesses so you know what to look for during the vehicle inspection or test drive. 2. Take a test drive The test drive gives you the chance to see if you like the vehicle and if it offers good visibility. It can be hard for non-professionals to gauge road handling or the condition of the engine, but you can still make sure all the equipment works, including the back-up camera, power windows, air conditioning, doors, heated seats and sound system. Make sure your test drive includes city roads, highways and country roads. Listen carefully for any noises. Open a window so you can hear the engine and check for body noises while driving. Does the suspension seem good? Do you feel any vibrations through the steering wheel? Are the brakes responsive? You may also want to let the seller take the wheel their driving style can give you some insight into how the vehicle has been treated. FOUR

7 3. Inspect the vehicle in daylight Natural daylight is best for inspecting the vehicle s body and interior. It will be easier to check if the car is in mint condition or to spot any nicks, dents or scratches that could justify a price reduction. You should also check the tires for wear. 4. Bring a friend Someone who knows their way around cars can help you make a decision and negotiate with the seller. This forces the seller to convince two people instead of just one! 5. Make sure the vehicle is paid off If the current owner still owes money on the car, you could be on the hook for their debt, and the creditor could even seize the vehicle. To make sure this doesn t happen, verify the vehicle s financial history on the Register of personal and movable real rights (French only). A search costs between $3 and $9. You will need to enter the seller s first name, last name and date of birth, as well as the vehicle identification number. 6. Check the vehicle s history It s worth checking with the Canadian Police Information Centre to make sure you re not buying a stolen car. You can also request a copy of the vehicle s history from the Société de l assurance automobile du Québec to get details on past transactions, owners and usage. This service costs $11 and you will need to provide the vehicle identification number. For $50, you can consult CARPROOF, a report that lists the vehicle s accident history, provides information on import compliance (if the vehicle was imported from the U.S.) and helps you check if the odometer reading is correct. While all this information is useful, it should not be considered a guarantee. 7. Get the vehicle inspected A professional mechanical inspection will reveal the vehicle s true condition and you can use the report to negotiate the price. 8. Ask about maintenance Inquire about maintenance and repairs performed on the vehicle and ask for the invoices. Some repairs may still be covered by warranty. 9. Draw up a contract A written contract isn t required, but it is strongly recommended if you want to avoid problems down the line. If a latent defect is discovered after the sale, the seller may be required to compensate you. Sample contracts are available on the CAA-Québec website. You can also ask a legal advisor to help you draw up a contract. 10. Declare the real price It can be tempting to save on sales tax by declaring a lower sale price when transferring vehicle ownership at the Société de l assurance automobile du Québec, but this isn t a good idea. If you need to make a claim down the road, you ll have a hard time explaining that you actually paid more for the vehicle. FIVE

8 4 questions to ask the seller In most cases, private sellers are honest, and you won t run into any problems after you buy your vehicle. But vehicles are expensive, so it s a good idea to take some precautions. Don t be afraid to ask questions. This is a big purchase and you don t want to make a mistake. 1. Why are you selling your car? Why is the seller no longer satisfied with the vehicle? This could give you some insight into shortcomings that you might not have considered. 2. How many times have you had to get the vehicle repaired? If the seller has kept maintenance and repair records, ask to see them. 3. Are any repairs needed? Ask for an estimate on any required work so you can factor it into the total purchase cost. This can also give you leverage for negotiating. 4. What equipment is included? Some equipment, such as winter tires or a roof cargo carrier, can add to the vehicle s value. This is your chance to get a good deal on them. Legal protection The Civil Code of Québec offers used vehicle buyers in the province some of the best protection in Canada. Sellers are required to declare any latent defects, and if the buyer discovers one post-sale, they must immediately report it to the seller. That s why it s so important to be able to locate the person who sold you the vehicle. If the seller refuses to settle the matter to the buyer s satisfaction, the buyer has three years to sue the seller. The Civil Code of Québec defines a latent defect as a flaw which renders [the vehicle] unfit for the use for which it was intended or which so diminishes its usefulness that the buyer would not have bought it or paid so high a price if he had been aware of it. SIX

9 3/ Beware of curbsiders Curbsiders are used car salespeople who try to sell pre-owned vehicles outside the jurisdiction of the Consumer Protection Act. If you buy from a curbsider, you could end up with a stolen vehicle a vehicle that was rebuilt after a serious accident or a vehicle whose odometer has been rolled back and you ll have no recourse. How can you tell if someone is a curbsider? In many cases, the sale price is lower than the market price for the same model with the same condition and odometer reading. Be careful if the price seems too good to be true. The first time you call the seller, say you re calling about the vehicle for sale, but don t mention the model. If they ask you which one you mean, chances are they have numerous vehicles for sale which is a good indicator that you re not dealing with a private seller. Ask if you can come by their home to see the vehicle, and take down their address and telephone number. If the seller insists on meeting in a public place, be wary. The licence plate number is another good indicator. If it starts with a letter followed by a hyphen, it s a dealer plate. Other warning signs include an expired licence plate or none at all. Compare the name on the vehicle papers with the seller s ID and ask whether the car is insured. If the seller claims they haven t renewed the insurance because they don t use the vehicle anymore, it often means that the vehicle has never been registered in their name. SEVEN

10 Ask the seller to provide you with maintenance and repair invoices. While this isn t absolutely necessary and offers you no real protection, it does give you an idea of whether or not the vehicle has been properly maintained. Be suspicious if the seller sidesteps your questions about the vehicle s history. If something doesn t seem right, be prepared to walk away. Finally, don t let anyone do the registration work for you. Go to the SAAQ office yourself for the transaction. Conclusion Purchasing a used car instead of a new one can be a great way to save money. You may be able to afford a bigger or more luxurious model or save a bundle on a standard model. Now that you know how to shop for a pre-owned vehicle, it s time to start looking for your next set of wheels! Here are some websites that list used cars for sale: kijiji.ca lespacs.com carpages.ca autohebdo.net auto123.com VISIT ESPACEAUTODESJARDINS.COM/EN TO HELP YOU PLAN YOUR PURCHASE WITH CALCULATORS AND HELPFUL TIPS. EIGHT