Used car sales are thriving in the COVID-19 era, and given the economic uncertainties caused by the pandemic, choosing a used car can be a great investment that allows consumers to purchase a reliable vehicle that fits their needs while still saving money. However, the potential risks involved make it all the more important to make well-researched and informed decisions.
“A used car might test-drive like a dream, only to be a clunker a few weeks later,” said Michelle L. Corey, Better Business Bureau (BBB) St. Louis president and CEO. “It’s important to know the vehicle’s history and your rights under a warranty.”
BBB received more than 14,000 complaints last year regarding used car dealers. Many complaints follow a simple pattern: A consumer buys a used car, the car soon after malfunctions or fails to pass an inspection, and the consumer wants redress.
An East St. Louis, Illinois, woman told BBB in April 2020 that a used car she purchased from a local dealership began to overheat after two days and was found to have its computer purged of previous error codes. She said the dealership offered to repair the vehicle for free if she bought the necessary parts, subsequently offered to let her exchange the car, but then rescinded that offer and denied her request for a refund.
BBB has BBB Business Profiles on thousands of used car dealers, including reviews by past customers, a history of how they have handled complaints. BBB Business Profiles also include the dealer’s BBB Accreditation status — whether it has committed to following BBB’s Standards for Trust.
When shopping for a used car, BBB recommends following these tips:
- Do the research. There are many online resources to check the average retail prices of various makes and models of used cars depending on the year and how many miles are on the car. These prices will give you an idea of what the used car should sell for when looking at different locations. Research the dealer carefully, too, by looking up its BBB Business Profile at bbb.org.
- Evaluate your finances and budget carefully. Check your credit score before shopping, as it may impact the type of financing for which you qualify, the terms of a loan, or even what vehicles you may be approved to purchase. Visit your bank or credit union to get pre-approved for a loan, so you can compare rates offered by the dealer. Allow room in your budget for repairs, which will help give you realistic expectations of what you can truly afford. Be sure to include the price of the tax, title, registration, and insurance; together these costs are estimated to be 10% of the purchase price.
- Ask specific questions about a vehicle’s history and condition. If a salesperson indicates that a vehicle has been “inspected” or “checked over”, ask for specific details. Was it a mechanical inspection, or just visual? Has the vehicle been put up on a lift? Ask for any records on the vehicle, including those related to inspection, prior maintenance, and any repairs done by the dealer. Ask for a vehicle history report, which can reveal past issues such as accidents; however, it does not guarantee the vehicle’s condition.
- Evaluate the dealer’s COVID-19 precautions. Does the dealer take precautions such as social distancing when it comes to the transaction or test drive? Has the vehicle been properly sanitized?
- Consider having a qualified mechanic inspect the vehicle. Reputable dealers encourage customers to have an inspection done by a qualified mechanic prior to purchase, and will generally allow a vehicle to be taken off-site for a short time with some basic information such as a customer’s driver’s license and proof of insurance. Pre-purchase inspections can cost upwards of $100 but may help identify potential issues and save on costly repairs later.
- Get any additional commitments made by the dealer in writing. If the dealer has agreed to perform or pay for additional repairs as a condition of purchase, get these commitments written into the contract, including the timeframe for those repairs and who to contact to have work completed. This is sometimes referred to as a “We Owe” agreement.