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The smarter way to buy.

The primary reason to buy a used car is that a used car costs less than a new one. Not so many years

ago, there were only three ways to buy a used car: from a private owner, from a used-car dealer, or from a new-car dealer. Each presented a buyer with a question that was impossible to answer—how do I know if I'm getting a car that won't fall apart the day after I buy it? A prudent buyer could take precautions, of course, such as having a mechanic inspect the car before handing over a check, or patronizing a reputable dealer who would stand behind what he sold, but it was still usually a 'buyer beware' situation.

In recent years, however, a new way of marketing used cars has evolved which gives a buyers another, possibly more attractive, choice. Today, a buyer has the option of purchasing a CPO car or truck.

What's a CPO? It means Certified Pre-Owned, which means that the used vehicle in question isn't just a pig in a poke, but comes with some guarantee as to its initial quality and potential reliability.

The CPO phenomenon is essentially a byproduct of vehicle leasing, which took off in the late 1980s and early 1990s. In those days, automakers, particularly those who made high-priced luxury cars, put together attractive leasing packages that gave buyers the option of being able to drive a car for less per month than it would have cost if they had financed and purchased in the traditional way. Leasing peaked in 1999, when nearly three-and-a-half million vehicles, roughly a quarter of all new-car deals, were leased.

Think of leasing a car as being the same as leasing an apartment—you get to use it, but you don't own it. When the term of your lease expires, you move on. In the case of an apartment, the landlord freshens it up and puts it back on the market. In the case of a car or truck, the landlord, who is the auto dealer in conjunction with the automaker, does the same thing—the off-lease vehicle is reconditioned and put back on the market as a CPO.

At first, automakers were reluctant to flood the market with off-lease CPOs, fearing that they would undermine new-car sales. But that turned out not to be the case. Over the past decade or so, new-vehicle sales have been remarkably robust and sales of CPOs have run apace. For example, for one recent month, Audi reported 6,473 new-car sales and 2,225 CPO sales, a fairly typical proportion for some of the more upscale automakers.

Although leasing has tapered off somewhat in recent years—because heavy discounting and a variety of incentives have made the outright purchase of a new car more attractive—it still accounts for millions of transactions each year and keeps the CPO market well-stocked.

Tips for Buying

Introduction

Buying a used car obviously carries a certain degree of risk. After all, with a new car you get the peace of mind that no one has driven the vehicle carelessly or failed to have it maintained on a regular basis. And, if something does go wrong, the car is under warranty—at least for a period of time. These safeties are not usually included in the purchase of a used car. But used-car buying need not be as fraught with anxiety and terror as some may think. Knowing where and how to buy a used car as well as which cars to buy can alleviate most of the tension consumers feel about this unknown process. If you are willing to spend time doing thorough research, you will soon be driving the car of your dreams, secure in the knowledge that you paid a fair price for your new set of wheels.

Choosing a Used Car :

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How much could you afford? -

Before you begin your search for a good deal on a used car, spend time considering many of the same factors that would apply to a new car purchase: how will you use the vehicle; how long do you plan to keep it; and your budget for the purchase, including insurance, operation, maintenance and repair costs.

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What Car should you buy? -

Decide what car best suits your lifestyle and image. Since you could probably be owning and using the same car for many more years, you need to anticipate future needs and lifestyle changes. Today you could easily consider buying a mid-sized car as these cars are available at great bargains.

Narrowing down your dream list is a bit more difficult for used cars than new cars because there are so many more used vehicles. Talk to friends or acquaintances who drive cars that appeal to you; word of mouth is often one of the best ways to gather information about reliability or quirks of certain cars.

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How Old is Old? -

If Budget is top priority then you rather buy a smaller car that's newer than a large car that's older. Owning a larger car will cost you more as the running costs - fuel, maintenance, tyres, spares are costlier. The best bet is to look for something almost new - Two years or younger. You could get a real good deal because there are plenty of car owners who don't want to be seen in a 'yesterday's model' - they want to be seen driving only latest cars.

Buying a middle-aged car ( 3 - 5 years old ) that has been treated well by its owner could be a great deal. You could find a lot of these cars at a good bargain. Cars that have logged 14,000 to 18,000 Km a year are prime buys.

Cars flogged badly by chauffeurs or heavily used ones are like buying trouble.

Odometer readings can be rolled back, or "clocked." This fraud is practiced by thousands of fly-by-night, independent used-car sellers nationwide. The effect is obvious: a high-mileage car is turned into a low-mileage car to increase the car’s value. A car with low mileage, but with a lot of wear on the driver's seat or the brake and accelerator, may indicate tampering with the odometer.