How to buy a (used) car
I have two friends looking to buy used cars right now, and over the last fifteen years I purchased six used cars and re-sold five of them. While I'm a novice compared to real car salesmen, I have more experience than the average layman, and thought it would be useful to write down what I’ve learned.
Assumptions
I don’t have “fuck you” money. If you do, none of this matters.
I went for in Marin Country last week, and jogged by a house with a $275,000 Bently, and two $350,000 Super Cars in the driveway.
This article isn’t for the owners of that house. They don’t buy used cars.
I prefer to save $10,000 by buying a used car.
I want something safe and reliable with zero drama.
My primary goal in getting a new car is that it is safe, reliable, and drama-free.
My 2016 Toyota Prius isn’t sexy. But it is clean, inside and out, the leather seats have heaters, and the same model saved my life in 2022.
I don’t want another car soon
This article is written with the assumption that you don't want to buy a brand new car every two years.
I don't expect to upgrade my car for at least another 5 years. I’d rather spend some time now to save time over the next decade on repairs or another purchase.
This won’t be the last car I ever drive
This isn't the last car I’m going to own.
I hope to eventually own a used-but-nice sports car just for the fun of it!
My current car isn’t that.
I don’t mind doing a little bit of leg work – i.e. don’t buy the first car you come across.
I’m a hustler and a salesman, but don’t expect you to be.
I do anticipate that anyone benefiting from this article is willing to do just a little bit of leg work.
If you would rather spend an extra $10,000 or $20,000 – great! Buy your car new from a dealership. But three extra hours now (including the ten minutes it’ll take you to read this article) will save you thousands of dollars over the next few months.
Buy a used car
I’ve never purchased a brand new car.
You save between 15–20% of the price of a car when you don’t buy a car from a new car dealer. A $40,000 car will lose $6,000–$8,000 in value in the first year.
By year 5, that shiny new car is likely worth less than 50% of its original price.
I buy makes and models that have stood the test of time and cars that are 3-5 years old. My ideal car has been made for more than a decade, is about 5 years old, and has as few miles on it as I can find.
Talk to mechanics about the type of car to purchase
I like talking to mechanics. They're busy, terse, and usually covered in grease. But if you can get one talking, you’ll learn everything you need to know.
I used to drive a 2007 Subaru Forester. Every time I brought the car in for an oil change, my mechanic commented that this car – which I drove past 175,000 miles – was bulletproof.
(That Subaru Forester, nicknamed Indy, was totaled in an accident when someone hit me on the freeway. Yet another great car that saved my life.)
I asked my mechanic what car he would recommend if I were ever to upgrade, and he pointed me to a late model Toyota Prius – which is what I drive today.
Sexism and cars
When I was 21, I dated a woman who was 16 years older than me. Early on, I picked her up at the airport in my 1994 Honda Civic Hatchback. When she rolled down her window, the glass fell out of the door frame!
I was mortified, but she, quickly and efficiently, opened up the door, put the glass back in, and then put everything back together. Later that summer, she and her father even rebuilt my little Civic’s suspension.
That old girlfriend, and many women, know more about cars than I ever will. But the world of cars is sexist. If you are buying a car, and aren't a man yourself, bring a man with you. You’ll be treated with more respect and get better deals than a woman purchasing on her own.
Get a third party inspection
If there was one tactic I could impart to everybody purchasing a used car it would be this: get the car inspected before you buy.
One of the most overlooked things that any mechanic can do for you is third-party pre-purchase inspection.
After you have researched, sourced a car that you are interested in, looked over it in person, and taken it for a test drive, take your car to a nearby mechanic and have them do a pre-purchase inspection.
Source the mechanic in advance and call them to ensure they’re willing and available to do an inspection. It’ll cost you $150 and take a couple of hours.
Any trustworthy seller will have no problem with you paying a mechanic to do a brief inspection. If your seller objects, walk away!
When I was buying my current 2016 Toyota Prius, I found a local garage with no affiliation to my seller, scheduled, and then brought in the Prius. I believe I paid $120 and the inspection took one hour.
As I’d suspected, the car, which had 35,000 miles on it, was pristine inside and out – except for one thing.
The tires were bald.
I was able to negotiate the price of new tires off of the purchase price of the car and saved myself $1500.
A third-party inspection will tell you everything you need to know about your car.
Low miles
Get a car with low miles. This, alongside a mechanic’s inspection, is the surest way of determining the longevity of your vehicle.
Get a used car in the make and model that you want with as few miles as you can afford.
A car with low miles is one of the surest ways to determine that your car will serve you well for years to come.
Safety
In 2022 I was in a significant car crash. My Prius was hit by an SUV on the freeway going 70 and both cars were totaled. I was lucky to walk away with my life.
Do your research. Just Google or type into ChatGPT: “How safe is a [whatever make and model car you are considering]?”
The Toyota Prius is known to be reliable and safe. When my insurance paid out, I purchased the exact same make and model of car again.
One additional tip that I learned when I used to ride motorcycles (known as “donor bikes” in every Emergency Room in the country) is that the color of your vehicle impacts whether it will be seen on the road. A white or light colored car is more visible than a red, black or dark colored car. If you can, get a light colored car.
Know your details - make, model, and era
Know the make and model of the car you want.
After my 2022 car crash, I wanted another Toyota Prius. But I also know the era of the car. The first and second generation Prius had problems with their batteries, which got solved in the third and fourth generation.
If I was buying a Prius today, I’d go with the fifth generation because they’ve changed the body shape and it is less unattractive.
Do enough research to know the quirks and foibles of the make, model and generation of the car you want.
Knowing what you want makes finding it easier.
Don’t buy a lemon
In 2012, I bought a manual transmission Subaru Impreza. The car was great in the snow, sporty enough to feel sexy, a joy to ride.
But had I talked to a mechanic in advance, I would have learned that that era Impreza was notorious for problematic transmissions. And sure enough, six months later, the transmission seized up.
I bought the car for $5000 and was able to sell it for parts for $2000. An expensive lesson.
A lemon is the term ascribed to cars that are notoriously problematic. Research the make, model and era of your car. Talk to a mechanic who works with those cars, specifically, and ask about potential problems.
Do your research.
Advertisements vs. IRL
Advertisements are a bad indicator of how good something ultimately is in real life.
The only things I pay attention to in an ad when I’m buying a car are:
- Is it the Make, Model and Year you want?
- Are there pictures?
- How many miles?
- Clean title (Just don’t buy a Salvage title)
- Is it within a distance you’re willing to travel?
Everything else comes out when you and your mechanic inspect the car in person.
Private owner vs. used dealer
I don’t have a strong preference between buying from a private owner and a used car dealer, but it is worth knowing which you’re dealing with in advance.
A private seller is just someone like you and me who has a car to sell. They’ll know more about this car than you will, but beyond that their just a random person.
A used car dealer is a different thing entirely. By default I don’t trust car salesmen. I’m sure there are great car dealers in the world, but most car salesmen are pushy – it is how they are taught. They are in the business of selling cars, and their job is to sell you a car in as little time as possible.
They’ll know all the tricks: how to make a car look and smell great, how to negotiate, how to play on your insecurities.
Just like when you are talking to lawyers or doctors, apply the “bring a friend” rule. When buying a used car from a dealer, always bring a friend.
Lean on your friend for support, and don’t get rushed into anything. Never buy from a used car dealer on your first visit.
You don’t have to be an expert to trust your eyes
Ten years ago, I was hired as the first employee for a non-profit educational technology company.
My boss Vivienne Ming tasked me with hiring software engineers. I’m not an engineer and had never hired software engineers before!
It turns out, you don’t have to be technical to make good technical hires if the people you are hiring are willing to tolerate enough questions.
In the same vein, you don’t have to be an expert on cars in order to ask enough questions about this specific car, its background, and the owner’s driving habits that you can learn everything you need to know.
My advice is, as usual, “Ask more questions!”
Always negotiate
I was fortunate to spend a lot of my youth in the large open air markets of Latin America. I learned from a very young age that price is always negotiable.
We assume that the price listed on an item in the grocery store or at a coffee shop is what must be paid. That is never true with cars.
When you are buying a used car, the price is open for negotiation.
Come prepared to negotiate or bring someone with you who is.
Be willing to walk away
The final piece of advice for buying a used car – or anything else for that matter – is don't fall in love until after you have finalized the purchase.
When you are negotiating something as significant as the price of a car, it helps to be as dispassionate as possible.
Remember that there are many more like it available in the world. Likely, there are thousands of this specific car available over the next few months. Don’t be in a rush.
The person in any negotiation who is willing to walk away will likely get the better deal. Be willing to walk away (even if you plan to come back later), and you’ll do well buying your car.
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3 things I’ve loved this week
Quote I’m considering:
"The cost of being wrong is less than the cost of doing nothing" -Seth Godin
This book was written by Joe Girard, who holds a Guinness Book of World Record for most cars sold. The book is written in plain language, and shares Joe's journey into sales, belief that anyone can learn to sell, and how to do it.
Where a lot of books about sales are technical, describe complex systems, or site a lot of research, this book is humble, approachable, and legitimately fun to read.
Chris Sacca is the venture capitalist behind Lowercase Capital and now Lower Carbon Capital. He was briefly on SharkTank and an early investor in Twitter. Chris invests in companies that are trying to “unfuck the planet.”
Chris is pragmatic about climate change and argues that companies don't have to choose between solving climate issues and doing good. He also talks about raising free range kids and the value of kids learning to sell. As someone who learned sales in Latin American open air markets, I agree!
If you don't mind f-bombs, this interview is worth the listen.
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Until next week,
Robin
