Understanding the history of a used car before you buy it is vital, but it can sometimes be difficult to get a full and accurate picture. Some sellers may lie about the condition of a vehicle or simply not remember everything that’s happened to it. This is where a CarFax report comes in.
We always recommend getting a pre-purchase inspection on any used vehicle you are considering purchasing, however at a bare minimum you need to get your hands on the vehicle’s history report.
What is a CarFax report? It’s a simple document that sheds light on the entire history of a given vehicle, starting from the time that it was manufactured. Understanding all of this information can help you to decide whether you want to buy the car, assist in negotiations, and let you understand what to expect from the car in the future.
Let’s take a look at what else you can learn from these important reports.
What is a CarFax Report?
CarFax was founded in 1984 as a method to use data center tools to track and prevent odometer fraud. These days, CarFax maintains a database of over 6 billion vehicles in the United States and Canada.
An individual consumer or dealership can pay a fee to CarFax, along with the VIN for the car in question, and CarFax will present a detailed report about that vehicle.
So what’s on a CarFax report? There’s usually plenty of data to help consumers make an informed purchase decision. The data from CarFax comes from over 100,000 different sources. Much of the data on a CarFax report comes from police departments, since they are the first responders that handle major and minor car accidents. Other sources of data include insurance companies and auto body shops.
What’s on a CarFax Report?
CarFax reports are broken down into several important sections. The section that’s particularly important for private sales is labeled “Title.” This is where the Department of Motor Vehicles’ information is listed.
Ensuring that the owner shown on the title matches the name of the person you’re buying from (if you’re not buying from a dealership, that is) will go far in keeping you out of trouble. This section will also inform you if the car has a salvaged title. It can even tell you if the car has been reported as stolen (run the other direction if it is).
Salvaged titles are not necessarily a lost cause. A salvage title means that the vehicle was in an accident and was declared to be totaled by an insurance company. After it was declared to be totaled, someone else took it upon themselves to repair the vehicle and put it back on the road. Salvaged vehicles might not have anything wrong with them, but you should still be wary of getting into a salvaged vehicle, since there are likely to be a lot of unknown factors.
The next section on the CarFax vehicle history report will simply list the mileage of the vehicle. It’s okay if there are some differences here, but they should be minor. Any major difference in the mileage is a red flag and could indicate odometer fraud. Typically speaking, though, differences in the mileage report only mean that the record hasn’t been updated as further miles were driven.
A CarFax report will also list how many owners the car has had. In an ideal world, you would want to buy a car with as few owners as possible. Generally, this means that the car hasn’t been passed around too frequently. A car with too many owners is a mild red flag, as this can be associated with certain types of fraud. Take note that CarFax does not collect nor report the names and addresses of previous owners.
On top of understanding how many people have owned the car, you’ll also learn whether the vehicle was used commercially, in a lease, or as a ride-sharing vehicle. This information can help you to understand what you’re getting into, since commercially owned vehicles will generally have more miles and may have been treated a bit rougher in the past. A ride-sharing vehicle can have its own problems, too, including a more worn interior and rougher suspension.
On a CarFax vehicle history report, you’ll learn if there are any active recalls that pertain to the vehicle. If you see a major recall affecting the target vehicle, ask whether it’s been addressed. If not, ask for a discount, since you’ll have to deal with the recall.
Most recalls are for a specific component. If a component has been recalled, it means that the car needs to be taken into a dealership for service. If you buy a used car and immediately have to address a recall, it can be a significant inconvenience (which often means it’s a good idea to ask for a discount).
Most importantly, a CarFax vehicle history report will tell you the accident history of the target vehicle. Details about the accident should be provided as well. Understanding whether a vehicle has been in an accident can help you to make your purchase decision. If you do proceed with the purchase, you can use the accident as leverage during the negotiations.
CarFax will let you know whether any car accidents resulted in airbag deployments or severe structural damage. If you see either of these types of damage listed, you should proceed with extreme caution. But even if you see a severe collision listed on a CarFax report, you should ask questions about the accident and ask for documentation about the repairs.
While collisions are certainly the main source of damage to cars, they are not the only one. A CarFax report can also show if there was any significant damage from fire, hail, or floods. Hail damage can be repaired without much issue, but stay away from cars that have been in a fire or a flood. Both of these types of damage can compromise the safety of the vehicle and result in costly repairs down the road, even if the initial damage was already repaired.
What is a “Clean” Report?
You’ll often hear people say that a certain car has a “clean” CarFax report. This means that there was no information found that was concerning.
It’s worth noting that a clean CarFax report doesn’t mean that the vehicle is perfect and worthy of being purchased. Sometimes, information can be misreported or otherwise mishandled so that it doesn’t show up on a CarFax report. For example, this might happen if someone failed to report a fender bender.
Other times, data may not show up because it didn’t come from the right sources. For example, an auto body shop might report that they worked on a car and replaced the rear fender, but if their report didn’t contain any information about the accident that caused the damage in the first place, it may not show up on the CarFax report as an accident.
When Should I Request a Report?
It’s a good idea for anyone that is buying a used car to purchase a CarFax report before they sign on the dotted line. Many car dealerships are happy to provide a copy of the CarFax report for the vehicles that they sell.
You need to do everything you can to make sure that you’re buying a worthy vehicle, not a lemon that’ll break down on you next week. Test drives are one way to do that, and pre-purchase inspections are another way. Consider CarFax reports to be yet another tool in your toolbox when you want to make sure that you’re getting a good deal.
If you see any red flags appear on a CarFax report, it’s up to you to bring it up to the seller. Ask them whether there is a reasonable explanation for the things that came up on the report. You may end up hearing a string of excuses, but in some cases, you may get information that can alleviate your concerns.
Should I Get a CarFax Report?
As of 2021, one CarFax report costs $39.99, with discounts for volume as you increase the number of reports. Considering how much you’re likely to spend on the car, this is a minor expense that’s usually well worth the cost, especially if you end up using the information to negotiate the purchase price for your vehicle.
If you’re working with a used car dealer, ask them to supply a CarFax report for the vehicle that you’re interested in. It’s in their best interests to show that they have confidence in their cars and they usually don’t mind paying the small fee. If they won’t provide you with a report, it might be time to move on to the next dealership.
If you’re working with a private seller, on the other hand, don’t expect them to provide you with a CarFax report — you’ll most likely have to purchase your own as part of your due diligence on the vehicle.
Remember to buy a pre-purchase inspection alongside your CarFax report, which can help you to have all of the information you need to make an informed purchase decision.
We love hearing from our CarEdge members about their recent car deals. It’s always wonderful to see the ways they’ve used our solutions to negotiate and secure an excellent dealon their next car.
Today, we’ll take a look at a story from Mike C. about his recent car purchase. He used our solutions to expertly land a deal that he was extremely happy with. That’s what it’s all about. Let’s dive in!
Background: A Thoroughly Researched Decision
Mike had a 2017 Buick Envision with a warranty that was about to expire. Not wanting to drive a car without a warranty, he started researching his options for buying a new car 8 months before he stepped foot on the lot at a dealership.
He discovered CarEdge on YouTube while researching car reviews. He was “instantly impressed” and began watching videos and taking notes. He even went through our Deal School.
After researching different options, Mike decided to pursue a new 2021 Hyundai Santa Fe Limited. Mike’s initial plan was to wait until the end of March (per Ray’s advice), but after noticing that his bid from Carvanafor his Buick increased, he decided it was time to act.
Using our email templates, Mike reached out to eight dealerships in the area. Seven dealerships replied with out-the-door (OTD) prices. He then used the lowest of the eight OTD prices to negotiate with the other dealerships. Although he received a few excuses about why they couldn’t lower their price, he eventually heard back from one of the dealerships with a price that Mike considered to be fair.
According to Mike, “Your email templates were invaluable. They quickly identified the motivated dealers in the area.”
He printed off all of the documentation from us, along with his Carvana quote, and headed into the dealership.
At the Dealership: Efficient and Effective
Mike had already negotiated the OTD price over email. When he arrived at the dealership, he verified all the numbers with the sales manager, and “Deal 1,” as Mike puts it, was done in minutes.
“Deal 2” was trading in Mike’s current vehicle, his Buick. Initially, the sales manager said he couldn’t even get close to the trade-in value that Mike wanted. Then, Mike showed them the Black Book numbers that we provided him in the Market Price Report, along with Carvana’s offer. With all of this evidence presented, the sales manager agreed to come up to $20,600, which was acceptable.
In the F&I Office: A Quick Decline
The “friendly but assertive” F&I manager struck out when he started to offer Mike different protection packages and vehicle service contracts. Mike simply said no.
He also verified that there was no early payment penalty on financing. The F&I manager said there was not a penalty, but that if he didn’t wait 90 days to pay off the loan, then it would result in a chargeback to the dealership.
Two hours after arriving, Mike and his wife drove away with a brand-new Hyundai Santa Fe.
An Easy, Yet Excellent Deal
Let’s evaluate Mike’s deal. He graciously provided us with all of the figures, which are:
MSRP was $40,395 + dealer add-ons (tint, nitro, wheel locks, pinstripe and more) at $1,767 for a total price of $42,162
Dealer sales price was $37,900, less $1,250 in Hyundai rebates
Doc fee of $150
TTL of $193
Sales tax of $1,084.82
Total OTD price was $38,077.82
Mike admits that there was probably room for improvement (and there always is), but he’s happy with the deal he received. He tells us that the deal he landed was as good as he could’ve hoped. Considering that the 2021 Santa Fe Limited had only been out for 2 months, Mike says he thinks that he got the best price possible.
We agree with Mike. It looks like he got a great deal. He used our tools to expertly find out all of the background information that he needed to negotiate. We especially like the way he utilized our email templates to get dealerships to negotiate against each other.
As Mike put it when reflecting on his transaction, “The power of knowledge cannot be denied. CarEdge access to days on lot, price history, and Black Book values are info sources of immense importance. Your deal school is an awesome body of work and will help just about every auto consumer. Some of the content I already knew, but I learned so much more. Your email templates were invaluable. They quickly identified the motivated dealers in the area.”
“All considered, my wife and I are really, really happy. Thank you for the time and effort you saved us. The time spent watching your videos was well worth it, given the info and entertainment value.Thank you for the money saved. Thank you for making the whole buying process just about stress-free.”
Well done and congratulations, Mike! We hope you enjoy your brand-new Santa Fe Limited.
Have you learned something new about buying, selling, or trading in a car as a CarEdge member? Share your story with us!
We love to hear success stories from the members at CarEdge. It’s great to see how people are putting our tools and information to use and securing excellent deals on their new purchases, sales, and trade-ins.
Today, we’re going to share a success story from Melissa. She doesn’t quite have her car in-hand due to the chip shortage, but she’s already secured a great price for her trade-in.
We’ll go over how she researched her negotiation, pushed when the dealership wouldn’t budge, and how she feels about the entire transaction. Let’s take a look at how Melissa negotiated the process and what she learned along the way.
Background: A Well-Researched Car Purchase
Melissa tells us that she started researching which car to buy in 2020, but that she only recently found CarEdge in early 2021.
One of the first things that she remembers learning from us was that she needed to negotiate her trade-in and new car purchase as two separate transactions. Prior to that, she never thought it would be important to separate the two, and since she was about to trade-in her car, she was happy to learn a new trick.
After she signed up for CarEdge and became familiar with our dashboard, Melissa began to use our “trade in valuation” tool powered by Black Book, the same valuation book dealers use.. She tells us that she immediately put that into good use, since she was working with several dealerships at the same time.
On one of our live streams, Melissa had her deal picked to go through an examination with our trade-in analyzer. This is a segment in our live streams where we pick a member’s deal and analyze it live.
During this stream, she learned about some pre-trade negotiation strategies. Melissa also benefited from another CarEdge member, Larry R, who shared some insights into what the tax benefit would be if she traded her vehicle in versus selling it to Carvana or Vroom.
With all of these facts and figures in place, Melissa was ready to head to the dealership to complete some final negotiations on her trade-in.
At the Dealership: One More Push
Although she had done a lot of the legwork upfront via email, Melissa made an appointment to visit a car dealership to finalize selling her trade-in. She decided to try to get more value out of her trade-in.
The salesperson was visibly upset, since they had already prepared the paperwork. As such, they were dismissive of her attempt to negotiate. They tried to push her to sign the documents and move along with the sale that had been negotiated via email.
She didn’t give in, however. Melissa made it clear that she knew used vehicle prices were skyrocketing due to the microchip shortage and that this wouldn’t stop anytime soon. She told them that she knew that car dealerships tend to make more money on used cars than new cars and it would be worthwhile for them to pay more for the trade-in.
Her point was further cemented when she let them know that she had already received multiple quotes from online price books and other dealerships for her vehicle, so she knew what her trade-in was worth.
Having the trade-in value that was provided by Black Book, the same value the dealer was using, helped Melissa to understand the value she should be receiving for her trade-in. Her persistence paid off and the dealership ultimately caved in and gave her another $200 for her trade-in.
After the Fact: A Deal Handled Perfectly
Melissa reported that on the same evening she traded her vehicle in, it showed up on the dealer’s website. The car dealership was asking for $3,690 more than what she received for it. Considering that a good part of that difference usually comes from reconditioning costs to prepare the vehicle for a new buyer, she was happy with the amount that she received from the deal.
Melissa is still waiting for her new car to be manufactured and shipped out. Unfortunately, the chip shortage has customers all around the world waiting for their cars to arrive. Melissa did not mention the make and model of the car that she’s buying, but we hope that she likes her new car when it comes in.
A Happy Member and a Trade-In Deal Negotiated Well
Melissa was very pleased with the value that she received for her trade-in. She’s grateful that she found our tools and was prepared to bring up the effect of the chip shortages at the dealership.
In her opinion, she’s saved over $4,000 compared to what she would have paid without CarEdge. We’re glad you negotiated a great price on your trade-in, Melissa!
Trading in your car can help you to buy a new car without having to put a large amount of money down. However, you need to keep in mind that dealerships will want to sell you a new car for as much as they can, while paying you as little as possible on your trade-in.
Today, we’re going to cover how you can use your trade-in to your advantage. We’ll discuss the best ways to boost your car’s trade-in value and give you tips on how you should negotiate while you’re at the dealership.
How to Trade in a Car for Maximum Value
You’ve decided to trade in your car. What should you do next? Learning how to trade in a car is vital to getting the most bang for your buck. Here are your next steps.
Research Your Car’s Value
Understanding how much a dealership should be offering is essential to successfully negotiating your trade-in value. You can use Kelley Blue Book or our Market Price Report to gain an understanding of what similar cars are going for. You can bring printouts of both sources with you to the dealership to show that you’ve done your research.
Fix Cosmetic Issues
There’s no need to give the car a new paint job, but fixing any cosmetic issues will go far in getting the most for your trade-in. It’s also worth cleaning the interior and exterior before you take the car to a dealership. Break out the shampoo for the carpets, go through a car wash, and fix any dents. You might be surprised how big of a deal this can be.
Shop at Multiple Dealerships
There are plenty of reasons to shop around at different dealerships. Every dealership will offer you a different amount for your car, and some will be more open to negotiating than others.
Make sure to obtain quotes from these dealerships for your trade-in and take them with you to the next dealership. These quotes — along with your Kelley Blue Book estimate — will help you when it’s time to negotiate.
Once you have a firm understanding of your car’s value, have fixed any issues, and you’re prepared to shop around at multiple dealerships, it’s time to negotiate.
How to Negotiate Your Car Trade-In Value
Avoid the temptation of negotiating your car trade-in value when you’re negotiating the price of a new car. You should negotiate both numbers separately. When you mix the negotiations, there’s too much potential for the salesperson to tweak the numbers so that it seems like you’re getting a better deal than you really are.
Your first order of business is to negotiate the price that you’ll pay for your new car. Once that is nailed down, then you can start talking about how much you’ll receive for your trade-in.
Use quotes from other dealerships and the Kelley Blue Book estimate to illustrate that you know what a fair offer looks like. Since many car dealerships will directly resell your trade-in on their used car lot, there’s an incentive for them to be competitive.
Stay firm in what you’ll accept. If they won’t give you a good price, then it’s time to leave that dealership. It’s worth taking your time to trade in a car the right way.
How to Trade in a Car: Keep Timing in Mind
Timing matters when it comes to trading in your car. Being patient can often pay off. Factors such as weather, the type of car that you have, and other socioeconomic factors can come into play with the trade-in value that you receive.
For example, trading in an SUV that is in great condition right before winter can often result in a better trade-in value, as winter weather tends to drum up extra business from people that are looking for something that can handle snowy conditions. Think about the time of the year as it relates to what you’re offering.
Other factors can impact the sales process, too. It’s always better to try to buy a car at the end of the month or at the end of the year. That’s when car dealerships are trying to boost their numbers at the end of their sale periods. You’re likely to get a great price on your new car and a high trade-in value at these times.
How to Trade in a Car: Stay Informed and Stay Firm
Do your research to make sure that you know what your car is worth when you want to trade in a car. Stay firm on the amount that you’ll accept for your trade-in. Be aware that some dealerships may try to manipulate the numbers. Sometimes, what looks like a good deal on your trade-in is made up for with a bad deal in another area.
Remember, you can always say “no” and walk out of the dealership. It’s your car and you deserve to get a great deal.
Most people don’t look forward to buying a car. While the act of owning a new car is enjoyable enough that some people can power through it, it’s just not worth it to everyone. That’s where car brokers come in.
Car brokers can help you to navigate the automotive world on a personal level to help you buy your dream car. They can even help you to find a rare or specific vehicle.
Today, we’re going to examine what a car broker is, when you should use one, and how you can find a quality one.
What is a Car Broker?
What is a car broker? A car broker, also known as a car buying service, is basically a professional car buyer. The goal of a car broker is to level the playing field between you and the car dealership.
An auto broker is familiar with car dealership’s sales tactics, strategies for negotiating, and profit margins. They know how and where to save money throughout the entire process. They won’t fall for some of the numbers manipulations or specific strategies that might work on other customers. Instead, they’ll see these tactics coming and have a rebuttal already prepared.
Some auto brokers work for themselves or a small company, while others are part of a concierge service at a bank or credit union. An auto broker will often work for dealers and customers, helping to connect the two.
There are two ways that car brokers make their money: As a flat rate or as a percentage. An auto broker might charge everyone a flat rate, ranging from $200-$1,000. Other brokers opt to charge a percentage of the money that they saved you on your purchase. Expect to pay a retainer of approximately $100 once you decide to use an auto broker.
Car brokers can help to negotiate deals for new and used cars with dealerships.
Reasons to Use a Car Buying Service
Now that we’ve answered the question “what is a car broker,” we need to discuss the reasons that you should use one. People typically decide to use a car buying service to save time and money. Car brokers know exactly how to navigate the sales process to find any opportunities to save you money. You also won’t have to waste your time negotiating and spending hours at a dealership.
Other car buying services might be used when you’re looking for a rare or vintage car. Specialists hunt down these cars and buy them for their clients. This is a much more high-end service than the kind offered by the average car broker.
Using a car broker is similar to using a real estate agent. They help you to minimize mistakes and maximize your savings. For those looking to skip the whole car buying process altogether, this is a great way to go.
How Do You Find a Car Buying Service?
There are several things that you need to do when you want to hire a car buying service. You should begin by asking about options available through your favorite warehouse club store or the credit union that you bank with. Many types of brokers that offer car buying services may even have their fees included with your memberships.
If you don’t have a free option, it’s time to head online and look for a well-reviewed auto broker. Some attributes to look for are:
A flat fee that varies based on the quality of the car being purchased
A fee structure based on a percentage of savings under MSRP
Not taking any form of payment or kickback from dealerships
Offering services like trade-in brokering or delivery to your home
You will need to make sure that the auto broker is licensed to sell cars in your state and that they are able to abide by any other regulations that may apply to your specific transaction. Research any potential auto brokers on review-based sites to see how other customers have felt about working with them.
Deciding to work with an auto broker might well be worth your time. If you don’t care to learn the ins and outs of car buying in order to score a great deal, auto brokers are an excellent alternative. Keep in mind the requirements that we’ve outlined above and do plenty of research before deciding which one to work with.
Of course, if you want to learn how to negotiate and handle the work yourself, we’ve got a deal school that’s designed just for you.
States eligibile for below invoice pricing and 100% free delivery:
Alabama, Arkansas, Texas, Oklahoma, Florida, Georgia, Kentucky, Louisiana, Maryland, Delaware, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, and West Virginia.
What if I don’t live in these states? If you're outside these areas, don't worry! We're committed to making sure everyone can enjoy our deals. Although the delivery fee will not be waived, you can still purchase from CarEdge and either pay for shipping or coordinate pickup at a participating dealer.
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