Private Sales

The private sale-by-owner of a used car is often the first stop for car shoppers looking for a bargain, and it’s easy to understand why. When you’re dealing with another private owner, the transaction can be much less complicated and offer much greater flexibility. However, you also have to assume some of the liability that otherwise would be taken on by the dealership.

Legal Issues

The most important thing you have to do when buying a car from a private owner is prove that you purchased the car legally. Fortunately, this is not too difficult – the owner simply has to sign the title over to you. The back of the title should have clearly marked places for you both to sign your names – congratulations! The car is now yours! Once you have this document in hand, you have to register that sale with the DMV.

This will most likely require you to actually go to the DMV in person, unfortunately. But, if you have all the necessary paperwork, the worst you’ll have to do is simply wait in line. Bring along the title, signed by you and the seller, as well as a bill of sale that clearly shows how much the car was purchased for, and the VIN and odometer reading. You will most likely have to fill out some additional paperwork and pay some fees, but if everything goes smoothly, you’ll be walking out of there with your new license plates, ready to hit the road in your brand new used car.

While determining that you have engaged in a legal transaction is perhaps the most important part of the transaction, it is also the last thing you’ll have to do. As such, keep it in mind throughout the shopping process, but heed the following tips along the way.

Stranger Danger

When you’re buying a private sale, you most likely do not know the person doing the selling. As such, you don’t know if they’re a scam artist – many unscrupulous dealers will pose as private sellers in order to offload inventory that they could never sell on the lot, in an act known as curbstoning. A good way to avoid this is to call the phone number listed in the ad and state simply, “I’m calling about the car.” If they ask, “which car?” then you know that they probably have more than one car for sale – a definite red flag.

Ask Questions

How many miles on the car? Why are you selling it? What condition is it in? These are questions you should ask before you even go to see the vehicle. The answers will greatly increase your negotiating power. At the very least, they’ll give you an idea of the car’s value. They will also give you a barometer for the type of person you’re dealing with – if they tell you on the phone that the car is in excellent condition, but when you finally see it, it clearly is not, walk away. That’s not the sort of person you want to be in business with. An understanding of why they want to sell will give you a further understanding of how motivated they are. If they just bought a new car for themselves, or if they’ve just inherited a relative’s car, they’re probably looking to offload the one they don’t use quickly for the cash. If it’s a less urgent scenario, where they can hold on to the car for a while to find the best price, your leverage decreases.

When you’re actually out to examine the car, you should ask for a complete history of the vehicle: how many owners has it had, where was it bought, are they willing to let you have it inspected. This will help you get an idea of the actual value of the vehicle. Don’t be afraid to ask them to purchase a CARFAX report for you, either! If they’re a motivated seller with nothing to hide, it should be an easy way for them to help close the deal.

The Test Drive

Buying from a dealership brings with it some guarantee of maintenance that you don’t find when buying from a private seller. As such, it’s important that you pay close attention to the vehicle when you take it for a test drive. Don’t just drive down the road – try and get a full appreciation for how the car performs under the usual stresses you’ll be putting it through. Take it on the highway, pay attention to how it turns and shifts gears, and don’t forget to check the reverse gear! Look for any pull in the steering, listen for any strange noises. Let it warm up and check the heat and air conditioning, if applicable. Test the windows and the headlights – make sure it will pass inspection! When you come to a stop, after the engine has had an opportunity to heat up, check under the car for any leaks or other warning signs. If there are any problems, try and work them into the price or make their repair a condition for the sale. And take your time! Doing your due diligence is the best way to avoid getting taken for a ride – after all, you’re supposed to be the driver!

Negotiating

Once you’ve done your research, take what you know about the car and try to find a fair market value. This means finding out what other, similar cars have sold for in your area. Armed with this information, determine what you’re willing to pay, and bring your lowest offer with you in cash to the negotiation. Keep that amount bundled in one pocket, and bring the difference between that number and the most you’re willing to pay with you as well, but separate. Never underestimate the effect that flashing a big wad of cash can have on a seller!