How to buy a used car from a private party

Tips for buying a used car from a private party

You can often get a better deal when buying a used car from a private party. But the process is much different than buying from a dealer and your expectations should be as well. Here are a few pros and cons of buying from a private seller:

Reasons to buy a used car from a private seller

• Most used cars at the dealer are from an auction so they can’t answer questions about the vehicle’s history. But you can ask the private party a whole host of questions (see below)

• Private sellers are usually selling because they’re trying to get more from you than the dealer is offering them on a trade-in. So you can often pay somewhere between trade-in price and full retail.

• Private sellers may have all the service records to show you.

Cons to buying a used car from a private party seller

• Unlike a dealer that has a reputation to worry about, a private seller doesn’t much care whether you’re happy with the transaction and they probably won’t do anything for you after the sale if you’re unhappy.

• Dealers often do a full detail-prep on the vehicle to make it look nice. Private party sellers may vacuum the seats and floor mats, but you can expect the engine to look pretty dirty.

• Private sellers are sometimes unloading a lemon vehicle and will lie about its condition (but used car dealers lie too).

• It’s a bit harder to complete the title transfer with a private party. A dealer does all the paperwork for you while buying from a private party often means completing the transaction at the local DMV.

Do your homework before buying a used car from a private seller

You can’t possibly negotiate the price if you don’t know what comparable vehicles are selling for in your area. Go to NADA.com, KBB.com, TrueCar.com, and Edmunds.com and do a search for the vehicle you want. Those sites will tell you what people in your area are paying for comparable cars.

What should you offer a private party?

Private party sellers often list their vehicles for full retail price. They’re delusional. Nobody is going to pay them the full price. In fact, you should never pay a private party more than half of the difference between full retail and trade-in price. That way both you and the seller come out ahead; they get more than they would if they trade it in and you save some money.

What questions to ask a private party seller before you even go see the car

How long have you owned the vehicle and how many miles have you put on it?

What you really want to know here is if their answers to your questions are reliable. If they’ve owned the vehicle for a while, they’ll know its history. But if they are flipping the vehicle they won’t have the answers or they’ll plain out lie. Don’t buy from flippers. You almost always get burned.

Are you a dealer?

Dealers often masquerade as private party sellers. A legit dealer will tell you right away because you’ll have to go to their business to see the vehicle. But shady fly-by-night dealers who pretend to be private party sellers often buy their vehicles from low-end auction salvage operators. Stay away from these sellers. They fix up the wrecks just enough to make them run and then dump them on unsuspecting buyers.

Has it been in an accident since you’ve owned it? Where was it repaired and is the work guaranteed?

If the seller had an accident, that alone isn’t a reason not to buy. Lots of people have fender benders. What you want to know is if the accident caused major body damage and whether the repairs were done by a reputable shop or by the current owner’s brother in law who moonlights by doing bodywork in his garage. If the damage was repaired by a reputable body shop, you’ll know it was done right, especially if there’s a warranty on the repair.

Why are you selling it?

This is important. Selling a used car because the seller is buying a newer car is a perfectly legit reason. In times of Covid, selling because they can’t afford to keep an additional car is also a valid reason. Working from home has caused a lot of families to get rid of the extra vehicle. If the seller gives you a different reason, be suspicious.

What repairs and maintenance have you done in the last year and do you have receipts?

Not everybody keeps receipts. If the seller doesn’t have them, ask where they had the work done. The whole point here is to find out if the seller has been maintaining the vehicles.

Do all the accessories work?

Ask about: Power seats, heated seats, AC, heat, rear defroster, power windows, power mirrors, radio/Bluetooth. You need to know this going into the transaction. Power seats and AC repairs can be very expensive. Radios are cheap to replace but replacement factory navigation systems cost a small fortune to fix.

Does this vehicle have a clean title? Has the vehicle ever had a rebuilt or salvage title?

As a general rule, you should avoid vehicles with a salvage or rebuilt title. They’re nothing but trouble and you should know this before you even decide to view the car in person.

Is there a lienholder on the title and are there multiple names on the title?

This is important to know because the seller will have to pay off the lien and provide a lien waiver before they can transfer the title to you. If multiple people (usually husband and wife) are on the title, both parties will have to sign off on the title before it can be transferred. That’s easy if the husband/wife is on good terms, not so easy if they’re not speaking to one another and you get caught in the middle of a domestic dispute.

Does it have current smog?

If your state requires smog testing, having a current smog certificate is really important.

Will the private party seller agree to let you get a pre-purchase inspection at your shop?

In most cases, sellers hesitate on the pre-purchase inspection because they’re worried you’ll come back with a laundry list of “recommended” repairs and then want to renegotiate the price. But there’s a way around this. Once you negotiate the price, tell the seller you’ll buy the car contingent on a pre-purchase inspection that doesn’t come up with more than $500 in recommended repairs.

View the car in person and take for a test drive.

See this post on what to look for.

How to handle the pre-purchase inspection

Make arrangements at the shop of your choice and have the seller drop the car off.

How to finalize the deal the car sale

In most cases, it’s best to meet the seller at the local DMV office. If there are any problems with the title, lien waiver or signatures, you’ll find out before you hand over the cash.

©, 2020 Rick Muscoplat