If you’re wondering how to buy a used car from a private seller, you’ve come to the right place.
The truth is, it won’t be easy.
Compared with buying from a dealership, you won’t have the security of a well-known business behind you.
Trust will be based on how well you know the seller.
But don’t worry.
Buying a used car from a private seller doesn’t have to be scary.
You don’t have to worry that you’ll be scammed and end up buying a lemon.
In today’s blog, I’ll give you a step-by-step guide on how to buy a used car from a private seller, including:
- The documentation needed to accomplish the sale
- How to avoid getting scammed
- How to tell if the car you’re considering is in good condition
- And more
Let’s dive right in.
Why Buy a Used Car from a Private Seller? (The Advantages of Skipping the Dealership)
If you’re buying a car from a friend you trust, it’s easy to guess the advantages you’ll enjoy.
But even if you’re buying from a stranger, there are a couple of pros to choosing a private seller.
1. Private Sellers Are Just Regular People
Private sellers are just people like you and me.
They’re not sitting around the dealership lot all day, waiting to make a great sale.
Which means, they’ll be in a hurry. They’ll want to sell their car and get on with their lives. They probably need the money for a move, to travel, or to buy their next car.
Why this is great for you: they won’t sit around all day with you, bargaining about the price of the vehicle. If you have cash and can pay them immediately, they’ll likely be OK with making adjustments to fit your budget.
2. Private Sellers Don’t Incur Overhead Fees
A car dealership is a business.
This means there are a ton of overhead costs such as rental of space, taxes, employee salaries, and more.
Plus, agents usually add an extra $500 to $1,000 over the original price of the car.
On the other hand, what you pay for is what you get with a private seller.
Why You Might Not Want to Buy a Used Car from a Private Seller (The Disadvantages of Skipping the Dealership)
Of course, buying a used car from a private seller isn’t all sunshine are roses.
There can be serious cons as well.
Here are two of them:
1. You’ll Have Less Protection
Private car sellers aren’t businesses.
This means they don’t offer you the protection that dealing with a real business does.
For instance, you won’t get:
- Lemon law protection
- Rights to cancel the sale (if you have a change of heart in the next few days)
When you buy a used car from a private seller, it’s permanent.
This means if you wake up the next day and see that the car’s roof has caved in, you’ll need to shoulder all repairs.
2. You Won’t Get Financing Options
On a budget?
Maybe you plan to pay for your car on a monthly basis.
Unfortunately, private sellers usually require an upfront payment in cash.
Of course, you could always get a loan from a bank or lender.
However, you’ll have to line up for financing yourself, which takes a ton of time and effort.
How to Buy a Used Car from a Private Seller: 5 Steps to Success
Now that you’ve weighed the pros and cons of buying a used car from a private seller, it’s time to dive into the nitty-gritty.
Follow these five steps for a smooth transaction and better satisfaction with your used car.
How to Buy a Used Car from a Private Seller Step #1: Find the Car that’s Right for You
Unless you’re buying a used car from your BFF, you’ll need to do a ton of research before you find the perfect car.
Don’t worry, though.
You won’t need to buy a newspaper every day to scour the classified ads.
Today, all you need to do is hop onto a site like Craigslist.
Simply pick the area you live in and browse the cars + trucks for sale.
You’ll get something like this:
Remember, before you even hop onto Craigslist, you’ll need to have an idea of what your dream car looks like. (Do you want a truck, a sedan, or an SUV?)
You’ll also need to consider your budget, especially if you’re paying with cash.
How to Buy a Used Car from a Private Seller Step #2: Check Out the Car
Found a car you could see yourself driving?
Remember, though, that when it comes to buying used cars, a picture doesn’t paint a thousand words.
You should never make a deal based on what the owner says and what you see in the car’s photos alone.
Instead, you should set up an appointment to check out the car yourself.
It’s a good idea to meet in a public place in broad daylight.
Then, arm yourself with a checklist of what to inspect around the car.
This list should include:
- Rust. Look for signs of rust around the car’s body, doors, and wheel wells, or irregular paint where rust may have been covered.
- Uneven tire tread. If one tire’s tread doesn’t match the others’, it could mean the tire is worn out and needs to be replaced. It could even mean something more serious, like problems with suspension and alignment.
- The pedals. Watch out for worn-out or damaged pedals.
- AC and heating. To find out how well the cooling and heating systems work, turn both on for 2-3 minutes.
- Batteries. Open the hood and have a look at the batteries. Ask how old they are. Then, look out for signs of rust around the battery terminals.
- Shocks. Push down on the car’s hood and check if the car rocks up and down. If it does, the shocks are good. Do the same for the rear end of the car.
- Lights. Turn on all the car’s lights to see if they work well. These include the headlights and taillights.
- Wipers. Check out the wipers to make sure they function and don’t leave spots on the windshield.
If you like what you see, you’re ready to move on to the next step…
How to Buy a Used Car from a Private Seller Step #3: Test Drive the Car
Before you jump into the car with a stranger, ask to see their driver’s license or ID first.
Take a photo of it, then send the photo to a friend or family member.
Remember, precautions are always worth it, even if you feel the car owner is a nice, friendly guy.
When you’re done, you’re ready to take the car out on the road.
Keep in mind that this isn’t a fun joy ride.
As you go along, you need to peel your ears, eyes, nose, and other senses for signs that the car isn’t as great as it seems.
Watch out for:
- Unexplained noises
- Musty, unpleasant, or strange smells coming from the vents
- Unresponsive brakes and steering
- Warning lights
- Bad stop-and-go performance
Remember, you don’t have to put too much pressure on yourself.
If you feel you won’t be able to tell the difference between a quality car and a lemon, you can hire a mechanic for the day and take him along on the drive.
How to Buy a Used Car from a Private Seller Step #4: Keep Your Documentation in Mind
Buying a used car isn’t as simple as handing over the money to the seller and getting the keys in exchange.
You’ll need documentation too.
Here are three documents you’ll need:
- The car’s title. When you buy a used car, its title will be transferred to you. If the title doesn’t have the seller’s name on it, it’s a red flag.
- Bill of sale. The bill of sale should indicate all the details of the sale. These include details on the car, like its make and model, plus your and the seller’s details. Both parties should sign the document.
- Emission documents. These prove that the car is in good running condition. Most of the time, the seller will already have these prepared before the sale.
How to Buy a Used Car from a Private Seller Step #5: Stay Away from Scams
While most private used car sellers will be honest individuals looking to get rid of or upgrade their car…
…never discount the fact that there are a few scammers out there.
Here are three types of scams to look out for.
- Curbstoning. This type of scam involves an unlicensed dealer pretending to be a private car owner. Although it doesn’t seem too bad, the fact that the seller is lying to you about their identity could mean they’re lying to you about other things as well. To avoid a curbstoner, make sure to Google the seller’s name. If you see a ton of other listings under their name, it’s a red flag.
- Fake escrow. This scam involves a seller telling you to deposit money into a fake escrow account. When you do, you’ll either lose your money and get no car, or get a lemon. To avoid this, pick an escrow service you trust, and don’t accept the seller’s suggestion to go for an unknown one.
- Title scams. Never buy a car without a title. In some cases, the seller may be hiding the title because it’s not under their name. Or they don’t want to show it to you because the car has a history of being a lemon, a salvage car, or a taxi or police car.
When in doubt, it’s a good idea to check the vehicle’s history.
All you need to do is locate the car’s VIN (vehicle identification number), which can be found on the driver’s side of the dashboard, underneath the spare tire, in the well of the rear wheel, or in front of the engine under the hood.
After you’ve found it, you can use a service like AutoCheck to get a report on the vehicle’s history.
Trust me, it pays off to know that you’re buying a car that’s worth what you’re paying for it.
How to Buy a Used Car from a Private Seller: What It Boils Down To
Wondering how to buy a used car from a private seller?
You’re not alone.
And if you think it’s going to be as easy as pie, be warned.
There are scammers out there. There are lemons. There are cars that are fine, but aren’t worth what you’ll pay for them.
Don’t worry too much, though.
Simply follow the guidelines I’ve listed above, and you’ll be ready to find, check, and buy your first used car from a private seller.
When you carefully follow the list, you’ll end up with your dream car and a ton of saved money on the side.
All screenshots taken by the author, November 2021.