I thought I would discuss the topic of buying a vehicle. My Dad
used to always tell me “Never pay interest AND depreciation on the same
item!” What he means is that you should avoid financing an item that is
worth less tomorrow than what you paid for it today. In other words, try to
avoid financing your vehicles! I realize this is easier said than done, but one
way to do this is to purchase older, reliable used vehicles. I personally have
never bought a new vehicle, nor have I financed one.
The cost of paying interest and losing on depreciation is
extremely high. On the flip side, the risk of buying used is that you don’t
always know what you are getting. Are you getting someone else’s lemon or
problems? This is a valid concern, but there are steps you can take when
purchasing a vehicle to reduce your risks.
The first thing I do is look at the exterior of the vehicle. If
the car looks like the owner used the tried and true “park by feel”
method and uses the bumpers and fenders at every opportunity, I immediately
pass on the vehicle. It is expensive to repair and I don’t trust the previous
owner was a responsible owner. If the outside passes, I then move on to the
interior. Now, I have raised three kids and know that having a family means
that your vehicle can be a catch-all for various food, toys, shoes and
electronics. However, the interior of the vehicle reflects the persons pride in
the vehicle and attention to detail. I want to purchase a vehicle from someone
who was fussy about their car and maintained it regularly.
If everything looks good, it is time to start the car and listen.
I am listening for any irregular noises like ticks, rattles, squeals or
misfires. Also, I am checking to ensure that there are no “check
engine” lights or warning indicators on the gauges. If there are any
warnings here, I won’t buy unless I have more information. I NEVER believe
someone when they say the lights don’t mean anything. If they are minor, why
didn’t the owner fix them before selling?
Next, check the engine bay for any oil or coolant leaks. ALL
coolant leaks should be regarded as serious, although some are fairly
inexpensive to repair. If the car has been sitting for some time, or on
concrete/asphalt, look for oil drips on the ground. Leaks that drip should
always be taken seriously!
If the vehicle has a timing belt, when was it replaced? This can
be quite expensive on some vehicles and most manufacturers recommend it be
replaced every 100,000-120,000 km or every 10 years. If this is not done and
the belt breaks it may cause major damage to your engine.
The last step is the test drive. Again, listen for strange noises
while you drive and corner. How does it handle? Does it pull to one side or the
other? Is the suspension ok? Does the transmission behave ok?
Ok, all this information is helpful, but what if you’re not
mechanically inclined? In my opinion, the best way to reduce your risk when
buying a used vehicle is to have a garage do a “pre-purchase”
inspection. This way, a licensed technician can use their training and
experience to assist you. The technician has no emotional attachment to the
vehicle and can make an unbiased assessment as to the vehicles condition. We
have had many people come to us AFTER they bought a used vehicle, only to find
that there were many expensive repairs required before it can be insured. It is
better to have this information before parting with your hard-earned cash.
Remember, if a seller does not want you to have the vehicle inspected you have
to ask yourself, WHY NOT? If the vehicle is older then 10 years your insurance
company may also require an inspection.
Getting a CARFAX report and ensuring the vehicle has no liens is
very important. Unfortunately, it is necessary to protect yourself nowadays as
there are many scammers and immoral people out there. Most are honest, but like
my Dad says, “trust in man, but tie your horse tight!”.
There are no guarantees when a buying a used vehicle. You can,
however, greatly reduce the risk by buying smart and having the vehicle
inspected PRIOR to purchase. The savings earned by buying used and maintaining
a vehicle are substantial. My family has personally benefited financially by always
buying used vehicles and will continue to do so.