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How to Buy a Car from a Private Seller

While many people associate car purchasing with dealerships, private auto sellers make up a significant portion of the used car market, accounting for nearly 30% of used car sales from 2011-2013.1  Purchasing a car from a private seller can potentially net you hundreds or thousands of dollars in savings, compared to buying from a dealership. Many times, private sellers need to sell their car quickly due to a move, because they no longer need a vehicle or because they need extra money.

Whatever the circumstances behind a seller’s private sale, if you’re considering a purchase from a private party, there are a few things you should consider:

Private vehicle buying benefits

Private vehicle buying drawbacks

Buying from a Private Seller

Learning how to buy a car from a private seller expands your buying options beyond dealerships, possibly allowing you to get a better deal on your next car. Find out how to shop smart and what to look for when buying a used car from a private party.

Guide to buying from a private seller

If you're committed to exploring used vehicles from private sellers, see the guide below to help navigate the process.

Research – The first thing you need to do is research, plan and prepare for an automobile purchase. This includes budgeting for your car purchase, seeking financing, researching vehicles that suit your lifestyle and utilizing websites and classified ads to find used car offers in your area.

Scrutinize ads – When reading ads for cars, pay close attention to the length and quality of the vehicle’s description. Relevant information like mileage, make, model, year and length of ownership should be prerequisites to any ad. The seller should also indicate if he is the only owner the vehicle has had, or if the car has had other previous owners.

The description should also briefly outline the history of the vehicle’s use, any accidents sustained and details about the vehicle’s condition. Ideally, the seller will also disclose any imperfections or needed repairs. An ad that lists problems can sometimes signal that a seller is making a sincere attempt to accurately represent the vehicle’s condition.

Contact seller – If you’ve found a detailed description of a vehicle that you’re interested in, you can move forward with contacting the seller. Begin by confirming the information in the ad and ask preliminary questions concerning accident and repair history if that information is missing from the ad. Next, request a test drive and arrange a meeting with the seller in a public place, like a local parking lot.

Examine vehicle – Once you meet the seller, ask to take a tour of the vehicle and examine its condition before your test drive. If he or she has maintenance records, you’ll want to look closely at those as well. Take a few minutes and inspect the following:

Test drive - Once you've made your preliminary examination of the vehicle’s crucial and observable parts, it’s time for the test drive. Try to make the test drive last for no less than twenty minutes, so you can get a better sense of the car’s performance. Listen carefully to the sound of the engine and pay attention when the transmission shifts. If the engine seems unusually loud before shifting gears (in a vehicle with an automatic transmission) or if the shift doesn’t occur smoothly, it could be a sign of a transmission issue. Drive the car on the highway so you can see how the vehicle handles at higher speeds. If it seems that you need to adjust the steering wheel constantly to keep the vehicle going straight, it could be a sign of tire wear, alignment issues, or more serious problems.

Take the vehicle to your mechanic – If everything goes well with the test drive and you don’t find any major issues when you inspect the car, it is a good idea to ask the seller if you can take the vehicle to your mechanic for further inspection. The mechanic will be able to do a more thorough inspection of things like seals, brakes and bearings.

Make offer, close sale – Once you’ve completed the test drive and inspection and are satisfied with the car’s condition and performance, you can make an offer to purchase. Whether you want to simply offer the asking price or less is entirely your decision. If you’ve noticed significant defects or needed repairs (worn tires, old air filter, rusted battery), you can offer less than the asking price. If no such defects exist and the car is in good condition, you might not want to offer too much below the asking price so you don’t risk insulting the seller.

Once you agree on a price, all that remains is exchanging the money and completing the necessary paperwork. The most pressing document is the vehicle title, which officially transfers ownership from the seller to you. You should also request a signed receipt or bill of sale detailing the transaction, which you might want to bring with you to the sale. Each state will have their own set of obligations and necessary documentation to complete for a sale, so you should call a local BMV/DMV and ask for any clarification on sale documentation.

Finally, never hesitate to leave a situation that feels unseemly or suspicious. Also consider bringing a friend or relative to help you inspect the car and ensure safety. If you suspect a car has been stolen or the seller has arranged a meeting under false pretenses, leave immediately and notify the police.

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