The Best Places to Buy Used Cars

If you’re looking to buy a new car but not a new-new car then it’s important to learn about the best places to buy a used vehicle. While the process of buying a brand-new vehicle is pretty straightforward, there’s more to consider when buying used. You want to make sure you’re getting the best deal on a reliable vehicle while saving yourself the financial stress of buying a car fresh off the factory floor. For this reason, we’ve put together this guide to help car shoppers figure out the best place to buy used cars.

In general, used car buyers have two options when deciding where to get their car: a dealership or a private party. However, even within these two camps, you have many options for where to shop. We’re here to help car shoppers like you weigh the pros and cons of each option so you can feel confident in your decision.

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Keep in mind, it’s always in your best interest to do your research on any vehicle you plan to purchase. This means checking its vehicle identification number (VIN), getting a vehicle history report, and reviewing the National Highway Traffic Safety Administration site to learn about any existing recalls on the vehicle’s make and model. Now, let’s learn where to go when you’re preparing to buy.

Buying From a Dealership

Your first stop when shopping for a used car might be a standard, manufacturer-affiliated dealership. When you buy a new or used vehicle from a dealership, the process typically involves choosing a vehicle, getting a quote, and determining the best financing option.

Buying a used car this way has several benefits. First, most dealerships keep an updated list of their used car inventory online. This means you can browse the offerings at multiple dealerships and compare listings from the comfort and convenience of your couch. Second, dealerships typically have the option of in-house financing, which can add even more convenience to your experience. With in-house financing, the dealership can handle or reduce the amount of administrative work you have to do. Third, you can visit the dealership to see the vehicle in person and give it a test drive.

However, going straight to the dealership might not be the best option for everyone, and not every dealership offers the same experience. Before we get into the different dealership experiences you might have, it’s important to understand some cons of buying from a dealership.

For one, it might be more expensive. You might get a better deal on your preferred make and model of used car by shopping elsewhere. Further, many dealerships specialize in only one type of used car, limiting your options if you’re not 100% sure what you want.

Buying Certified Pre-Owned From a Dealership

If you’re looking to buy a used car that’s guaranteed to be in like-new condition, consider purchasing a certified pre-owned (CPO) vehicle from a dealership. These vehicles are usually low-mileage cars that have undergone inspection and been refurbished until they’re on par with the manufacturer’s standards.

Often, a CPO car is an off-lease vehicle that’s about two to four years old. This gives you peace of mind knowing the vehicle you buy has been gently used. However, for these reasons, CPO cars might be more expensive than other used vehicles. So, if you’re looking for a car that splits the difference between newish and used-ish (and don’t mind paying a little more), a CPO car might be a good option.

Buying Noncertified Pre-Owned From a Dealership

If you want the other benefits of buying from a dealership, such as in-house financing, but don’t need all the bells and whistles (or the price tag) of a CPO, then you can check out the other used car options through the dealership’s inventory page. Any used car you purchase through a dealership has likely undergone an inspection. Based on this inspection, the dealership typically resolves any major issues with the vehicle before they sell it.

Most of this used car inventory comes from trade-ins, and many dealerships give you a direct link to the vehicle’s CARFAX report or AutoReport page. While your used car might not be CPO-fresh, it’s likely to be in decent shape and have more documentation than that hunk of junk Joe’s selling up the street. As an added benefit, you can arrange a meet and greet to see the car in person and give it a test drive before you buy it.

Buying From an Independent Dealer

Your experience buying a used car from independent dealers might differ from that of buying through a manufacturer-affiliated establishment. Independent dealerships can vary widely in their practices and policies, so you’re going to want to vet the independent dealerships in your area to verify their reputation. Good resources for researching independent dealerships include Yelp, Google, and the Better Business Bureau.

Before you jump in, it’s also good to know that different independent dealerships can specialize in different types of vehicles. While these dealerships might not affiliate themselves with a particular automaker, they might have a specialty such as utility vehicles or luxury models. If you already know what kind of car you want, finding an independent dealership that works with that type of vehicle can be a good place to start. If you’re keeping your options open, consider checking out a dealership with a good variety of vehicles to explore.

Visiting independent used car dealerships can be a good option if you’re looking to buy a used car cheaper than what you can get at a chain. If you’re working on your credit score, it might also be easier to get financed through these dealerships. Also, for many of these dealerships, used cars are their bread and butter. Because these lots specialize in used cars, they might have better insight into the used car market than other sellers.

However, this route comes with a few downsides. First, independent dealerships might not have the same access to the extensive inventories big-name dealerships have. Additionally, large dealerships often have more contacts with local banks, which can improve your financing options and make the process simpler. This means you might end up with a less-than-ideal financing package, including higher interest rates than what you might get through a big-name dealership.

Ultimately, your mileage might vary when it comes to working with these types of dealerships, so do your homework on both the establishment and any vehicle you’re interested in purchasing.

Buying From a Large Chain Used Car Retailer

While many large-chain used car retailers fall under the category of independent dealerships, it’s worth mentioning them separately because they have their own share of pros and cons. Your experience purchasing from a large chain dealership might be closer to the experience of buying from a manufacturer-affiliated dealership than an independent one.

For example, these retailers often have extensive inventories of used cars they buy at auction. They are more likely to have better resources than your locally owned and operated independent dealership. This means buyers get the full dealership experience, from seeing the showroom to dealing with overly friendly professional sales associates.

You might also have the option to buy a warranty through the dealership or take advantage of in-house financing. With that said, the prices at these dealerships might be higher than visiting your local mom-and-pop used car lot.

Here’s what you can expect from the three best-known chain used car retailers:

CarMax: CarMax is the largest chain used car retailer in the nation, and buyers can find a diverse selection of makes and models through this dealership. Working with CarMax can also give you access to perks such as curbside pickup and delivery, no-haggle pricing, a 24-hour test-drive period, and a warranty that encompasses the first 90 days or 4,000 miles (whichever comes first) of ownership. DriveTime: Like CarMax, DriveTime has many perks to offer buyers. Here, you can access financing, no-haggle pricing, a limited warranty for up to 30 days or 1,500 miles, and a five-day return policy.AutoNation: Buyers using AutoNation can find new, used, and certified pre-owned vehicles, meaning this dealership offers a good variety of cars for those still exploring their options. This dealership also assists buyers by having them name their budget on arrival and working with them to find the vehicle that best suits their needs while staying within their means.

Buying From a Private Party

If you’re not looking to buy a used car from a dealership, your other option is to buy from a private party. This might mean purchasing a car from a friend, family member, neighbor, or another independent individual. You can make this purchase in person or online, from someone you know or a total stranger. Like buying from a dealership, each of these options has its pros and cons. Let’s look at what you need to know when buying a used car from a private party.

Buying In Person From a Private Seller

When you buy a used car from a private seller, your experience will depend on the individual with whom you work. The experience might be simpler than going through a dealership because it often has less paperwork and fewer opportunities for intense negotiations. This can be especially true if you’re buying from someone you know and trust. Buying a used car from a friend, family member, or neighbor can be as simple as exchanging cash for keys, though we highly recommend you acquire the formal paperwork (including the car title) to legitimize the transaction and protect your investment.

If you’re buying from a private seller you don’t know, it’s important to put in your due diligence to ensure their credibility. While plenty of legitimate people out there are just looking to sell their cars to good homes, be aware of potential scams, and be prepared to do the legwork when vetting any vehicle you might purchase.

At a minimum, get a car history report or the vehicle’s identification number so you can learn about potential problems before you invest. Try to schedule a time to see the car in person and test-drive it. You can also ask to bring the car to an independent, third-party mechanic for an evaluation. Getting an unbiased assessment can help you learn about any existing mechanical problems the car might have that could end up costing you in the long run. The last thing you want is to buy a used car you have to replace in three months.

With all that in mind, you might get a better deal on your used car by purchasing from a private seller than a dealership. Private sellers don’t have the same overhead as a dealership, meaning they can often afford to sell you a car at a fair price. Additionally, you might have an easier time negotiating the price of a used car with a private seller. Because private sellers typically aren’t trained in sales tactics in the same way as dealership professionals, negotiating might be easier.

Of course, working with private sellers can mean more risks in terms of what you get when you make your purchase. Dealerships must follow certain regulations that don’t apply to private sellers, so there’s less guarantee the car you buy is up to standard.

Also, you’ll have to do more work to manage your paperwork when you buy from a private seller. You must figure out your own financing before you pursue your purchase. Further, you don’t have the benefit or convenience of comparing vehicles side by side with a private seller like you would at a dealership lot.

Buying From an Online Seller

Shopping online can be convenient for many used car buyers. Online car listings can be great for finding available vehicles and making quick comparisons between your options. You can shop for local vehicles or expand your search to out of state, meaning you have a lot of flexibility compared to visiting local dealership lots. In some cases, you can even complete all the paperwork and finalize the transaction online, making this option the ultimate convenience.

However, buying online often comes with the same pitfalls as buying a used car from a private seller. Because you’re not going through a dealership, it’s up to you to do your research and determine the seller’s credibility. You’re also on your own when it comes to figuring out your financing and managing your paperwork.

If you’re buying a vehicle from out of state, the paperwork can become even more complicated because you’ll need to figure out what you owe on sales taxes and registration fees for both the state of purchase and your state of residence.

The other major disadvantage of buying online is you might not get to assess the car in person before you buy. Pictures can be misleading, and without seeing and testing the vehicle yourself, you might not know what you’re getting into. For that reason, it’s even more important to find out everything you can about a vehicle’s history, such as through a CARFAX report, if you’re looking to purchase online.

Where Is the Best Place To Buy Used Cars?

As you might expect, the best place to buy used vehicles depends on your needs and priorities. Buying through a dealership can be a great way to meet all your one-stop shop needs for comparing vehicles, testing, financing, and finalizing purchases. However, budget-savvy consumers might find more value in pursuing private sellers. If you’re a risk-taker who prioritizes convenience above all else or just need a cheap car fast looking online might be the best option.

Take time to reflect on your goals and needs. Weigh the pros and cons of each option to ensure you choose the right seller for you.

Finance & Insurance Editor

Elizabeth Rivelli is a freelance writer with more than three years of experience covering personal finance and insurance. She has extensive knowledge of various insurance lines, including car insurance and property insurance. Her byline has appeared in dozens of online finance publications, like The Balance, Investopedia, Reviews.com, Forbes, and Bankrate.