Get access to the same vehicle valuation tool that dealers rely on. With Black Book, you’ll have insider data to accurately assess trade-in and purchase values—empowering you to negotiate the best possible deal.
The car buying checklists we’ve created below are meant to help guide you during your car buying journey. If only buying a car was a simple and easy task … We all know it isn’t. Use the car buying checklist below to make sure you do your due diligence before spending tens of thousands of dollars.
We plan to add more checklists to this page over time. If you have a suggestion for a checklist, please let us know in the comments below. Since you are here, we think you may also be interested in these other free car buying resources:
Purchasing a vehicle is no easy task. One way to make the process a bit more confidence inspiring is to get a Carfax on a used vehicle to better understand it’s history. That begs the question though, how reliable is a Carfax report?
Carfax, and their primary competitor, AutoCheck are the industry standard when it comes to vehicle history reports. These companies have built networks of data providers that allow them to compile the most comprehensive history report on any given vehicle.
Although these companies work diligently to capture as much information as possible, they are not able to get their hands on everything. This is where Carfax and AutoCheck can run into issues. Their data feeds aren’t real time, and not every dealer, repair shop, or vehicle owner reports back to them. Worst of all, occasionally people will do nefarious things so that their Carfax report doesn’t show accurate information.
Let’s review how Carfax works and explore what you need to know before you purchase a used car. Without further ado, let’s dive in.
Carfax reliability: only as good as the data they receive
I can assure you that at least once in my 43 year career in the car business I “fat fingered” a key or two when entering information about a car into an online system. Unfortunately this happens more than we’d like to admit, and the end result is that companies like Carfax end up with information from dealers that isn’t always accurate.
The saying “garbage in, garbage out” couldn’t be more true when it comes to Carfax and their business model. Carfax entirely relies on their network of dealers, mechanics, and service centers to provide accurate information about vehicles. Unfortunately, that means relying on human beings that are busy and overworked to get things right 100% of the time.
The Carfax website boasts that they have “112,000 different sources” of data, which is truly incredible, and is what makes them the industry standard for vehicle history reports. As a car buyer, you simply need to be aware that the way Carfax captures data from the 112,000 sources is generally dependent on a human being entering information correctly. If you see a Carfax report where the odometer read 2,500 miles on 10/10/18, and then 5,200 miles on 10/11/18, you can be fairly certain it’s a typo. This doesn’t mean Carfax is bad (not at all), it simply means you should diligently review the data you see on a Carfax report to make sure it is logical and seemingly accurate.
Data is not realtime, there is a delay
One of the biggest frustrations we hear from CarEdge readers is that Carfax reports frequently “miss” recent accidents or other similar activities. This is 100% true, since Carfax is not “real time.”
As you know, Carfax relies on it’s network of thousands of data providers to share information with them. Information about an accident that happened yesterday may not appear on a vehicle’s Carfax until next week. Unfortunately there is latency between when an activity occurs, and when Carfax becomes aware of it.
This is why it is extremely important that you have a pre-purchase inspection completed on any used vehicle you are considering purchasing. The pre-purchase inspection will shed light on any issues the vehicle has that may not have been reported to Carfax yet.
Although Carfax is the industry standard for vehicle history reports, and they do have an incredible network of participating data providers, you need to understand that not everyone reports everything to Carfax.
Here’s a great example … Rental car fleets. Rental car companies are generally self-insured, which means that when a rental car is in an accident the rental car company’s in-house insurance agency handles the claim. This in-house insurance company may not report to Carfax, whereas all of the traditional consumer insurance agencies do. What happens to that VINs Carfax when the repair was never shared with Carfax? Well, nothing, because Carfax isn’t aware of it.
This happens more often than you’d like to think, and it further reinforces the need to get a pre-purchase inspection completed before a purchase. Another common example is when a vehicle is serviced at a small “mom and pop” mechanics shop that is not part of Carfax’s network. You may see a Carfax report that shows no vehicle service records for years, however it is likely that Carfax simply wasn’t collecting data from the auto shop where that owner was taking their vehicle.
Can you trust a Carfax report?
So how reliable is a Carfax report? It’s the best vehicle history report you’ll be able to get your hands on, and in that regard, it’s very important you review it before purchasing a vehicle. Is it the “end all be all” for your purchase? No, that’s where the pre-purchase inspection comes into play again. Should you check other sources for vehicle history information? Absolutely.
One of our favorite tactics to dig up even more information about a vehicle’s history is to call your insurance carrier and give them the VIN of a vehicle you are interested in purchasing. The insurance agency may have access to other information that you do not see on the Carfax or have otherwise been privy to. Give this a shot when you’re researching your next used car purchase.
Buying a repossessed car carries a lot of stigma. Why was the vehicle repossessed? Did the previous owner maintain it at all? Am I getting a great deal because it was a repo?
Savvy car buyers who are looking for great deals will inevitably find themselves researching repossessed cars. The thought of spending thousands upon thousands of dollars on sheet metal and a gas pedal is concerning for many shoppers, and buying a repossessed car can sometimes appear to be a more cost effective way to get into a used car.
Today we decided to tackle this topic and share our two cents on what you need to know about buying a repo car. As always, if you prefer to watch instead of read, simply click on the video above. Otherwise, let’s dive right in!
What is a repossessed car?
It goes without saying that life can be tough. We’ve all experienced it before. There are highs and there are lows, and unfortunately for some, the lows can entail not being able to pay their bills. When that happens, repossession is typically right around the corner. Sadly, this happens to millions of Americans each year.
Based on 2019 data, vehicles are repossessed at a rate of nearly 5,500 per day in the United States. That totals more than 2 million repossessions each year.
There are two types of repossessed car; voluntary and involuntary. As a car buyer you won’t know if the vehicle you’re purchasing was a voluntary surrender repossession, or an involuntary repossession. At the end of the day, both are repo cars, which means their former loan holder could not meet their payment obligations to the owner (the bank that gave them the loan).
Carfax reports have been known to show “repossessed” when applicable, however they aren’t 100% accurate, so knowing you are purchasing a previously repossessed car can be tough.
Should I buy a repo car?
Repossessed cars come in all sorts of different conditions. As I always like to say, “no two used cars are the same,” and repo cars are no different. The tricky thing about buying a repossessed car is that you have no clue how well the prior owner took care of the vehicle. That being said, getting your hands on the Carfax, and asking the seller (whether it be a dealer or a bank auction) to review the service history is an absolute must.
The more information you can get on the history of the vehicle the better, and without a doubt you need to get a pre-purchase inspection completed before buying any repossessed car. Just like with buying a used car at the dealership, a pre-purchase inspection will provide you with the peace of mind you need to know you are not spending thousands of dollars on a vehicle that is going to cost you thousands more to simply keep it running.
So should you buy a repo car? At the end of the day it is entirely up to you, however you need to be clear on what you are getting yourself into; a crapshoot. The best thing you can do is treat a repossessed car just like you would any other used car, and get all of the information you can about the vehicle before you sign any paperwork.
How do I know I am buying a repo car?
Sometimes Carfax reports will have an indication that a vehicle has been repossessed, however there is no title designation of “repossessed,” so you’ll never see a title that makes it clear the car was voluntarily or involuntarily repossessed. As well all know, Carfax reports are not 100% accurate, so it’s important to understand that you may never know you are buying a repossessed car, especially if you’re making your purchase at a dealership.
That being said, if you’re purchasing the vehicle directly from your local credit union or bank at a repossessed vehicle auction, then you know what you’re getting into. Websites like RepoFinder exist to help you search free repossessed car listings, however you’ll quickly find that their inventory is limited, and you’ll have better luck researching local options.
What concerns should I have buying a repo car?
Buying a repo car is very similar to buying a normal used car. You should have the same concerns you’d have if the car wasn’t repossessed. Specifically, you need to feel comfortable with the way the car drives and feels. Get a pre-purchase inspection from a trusted mechanic to confirm that the vehicle is in working condition, and that the listed price is fair and reasonable.
Buying a repossessed vehicle presents no different challenges than buying a normal used car. Some people believe that since the vehicle has been repossessed it means the prior driver did not have the means to maintain the vehicle well. There could be some efficacy to this argument, however the opposite also holds some weight: the prior driver probably used it as their daily car, and until financial hardship struck, they most likely took good care of the vehicle, because they needed it to transport them to and from work.
At the end of the day, buying a repossessed vehicle can be a way to get a used car at a slightly cheaper price, however your concerns should still be the same as if you were going directly to the dealer and purchasing a certified pre-owned car.
Will I get a deal if I buy a repossessed car?
Typically repossessed vehicles are auctioned off in an attempt to return the greatest amount of capital to the financial institution that issued the loan. That being said, if you buy a repo car from an auction you’ll be paying the highest price, however that “high bid” at an auction is still most likely going to be less than what it would cost to buy a very similar vehicle directly from a dealer.
Buying a used car in today’s market is like trying to ride a unicycle in grass — difficult. If you’re uninformed, you could easily overpay, fall victim to predatory fees, or even end up with a clunker. There are common car-buying mistakes you can (and should) avoid, and this is especially true when buying a used car, since in most states there are fewer legal protections once you buy a used car “as-is.”
Here at CarEdge we want to make sure you’re an informed car buyer that gets a good car at a fair price, and that’s why we decided to list out our top four tips you can refer to during your car buying process. No one wants to get taken advantage of, and with these four simple tips you can make sure you don’t fall prey to common car-buying mistakes.
Without further ado, let’s jump in!
Car-buying mistake #1: Not getting a pre-purchase inspection
One of the most common car-buying mistakes you can make is not getting a pre-purchase inspection on a used vehicle. A pre-purchase inspection is a must, even if you’re buying the car out of state.
Some car buyers aren’t aware that you can request a pre-purchase inspection, others don’t think it’s worth spending a few hundred dollars to get one done. Our rule of thumb? Always get a pre-purchase inspection on any used car. This includes certified pre-owned vehicles. Why? Because the peace of mind is worth it.
Every state is different, but generally speaking, the laws protecting used car buyers are pretty unforgiving. In most states the laws surrounding “as-is” purchases don’t provide any recourse for buyers who end up with a clunker. The purchase was made “as-is,” and the seller is in the clear.
With that in mind, it should be obvious that getting a pre-purchase inspection is priority number one when purchasing your next used car. Skipping a pre-purchase inspection can be a costly car-buying mistake that could have been avoided. Plus, you can even leverage the results of the pre-purchase inspection when negotiating the purchase price of the vehicle.
For example, if your mechanic says that the car needs new brake pads and an oil change, then you can negotiate the cost of those repairs into the selling price of the vehicle. If you didn’t conduct the pre-purchase inspection, you would have been stuck footing the bill for those repairs yourself.
How should you go about getting a pre-purchase inspection? I am glad you asked! First and foremost, if you have a trusted mechanic, have them do the inspection. If you don’t have someone on standby (which is most of us), then we recommend a service called Lemon Squad. Lemon Squad is a national network of mechanics, and the reason we recommend their service is because they have been in business for a decade, and they have an “A” rating with the Better Business Bureau.
If the seller of the vehicle won’t let you get a pre-purchase inspection, that’s a sign that this isn’t the right car for you to purchase. If you were selling a car in good faith, wouldn’t you let someone get an inspection done? If they won’t, walk away. It’s not worth making this car-buying mistake only to get stuck with a clunker.
Car-buying mistake #2: Don’t rely solely on CarFax or Autocheck
All too often we hear from car shoppers that they purchased a car that had a clean CarFax, only to find out after the fact that the vehicle had been in a minor accident, or had undisclosed repair work done. How and why does this happen so often? It’s simple, CarFax is only as good as the data they receive, and the reality is, CarFax and Autocheck don’t get ALL the information about a vehicle, and when they do, it might not always be that timely.
How can you protect yourself from this reality? Fortunately, there’s a simple workaround!
Make sure to google the VIN of the vehicle you’re interested in before purchasing. I can’t tell you the number of times a quick Google search has brought up accident photos, auction listings, and more that paint a very different picture than the CarFax or Autocheck did. Also, call your insurance company and tell them you’re thinking about purchasing a vehicle. Give them the VIN, and ask them to run a report on their end (insurance companies have access to more information than CarFax and Autocheck do). By simply calling your insurer, you can get a more clear picture of the history of any vehicle. Neat, eh?
Doing a quick (but through) VIN check before you buy a used car can save you countless headaches down the road.
Car-buying mistake #3: You don’t test drive the vehicle
As a car shopper, you should have no fear of test driving one (or many) vehicles. Taking a car (whether it be new or used) for a test drive is something you absolutely should do.
Although not as effective as a pre-purchase inspection, test driving a car will also shed light on if it is in good working order, and more importantly, it will also help you determine if it’s the right car for you. As my dad used to say to me, “the feel of the wheel can seal the deal,” and I think he is 100% right. It’s hard to commit to such a large purchase without at least first test driving a car.
Even if you’re getting the same car you already have (or have previously owned), it’s still important to take it for a test drive. No two used cars are exactly the same, and for that reason alone, it’s worth taking a test drive.
Car-buying mistake #4: You pay an additional reconditioning fee
We’ve written extensively about the fees you should and shouldn’t have to pay when purchasing a vehicle. The number of horror stories we’ve heard from shoppers who were charged for nitrogen tires, or a duplicative destination charge is unnerving. However one fee you should never have to pay on a used vehicle is an additional reconditioning fee.
If you are ever asked to pay a reconditioning fee that adds to the price of the car, refuse it! It is absolutely bogus.
Reconditioning is an industry term for the work a used car needs to get it “showroom ready.” This is simply a cost of purchasing inventory and preparing it for sale to a retail customer. With that in mind, if you ever see an additional “recon fee,” recognize that it is B.S., and remind the seller that the reconditioning should already be factored into the selling price of the vehicle.
Dealers have been known to tack on this fee, and it’s a car-buying mistake we’ve seen too many times before. Don’t pay for additional reconditioning!
Bonus tip! Car-buying mistake #5: Don’t overpay
Don’t overpay.
This may seem obvious, but do your best to not overpay. Cars are a commodity, which means there are A LOT of them.
Be diligent about checking market conditions for the car you’re considering purchasing. Make sure that the dealer you’re working with is not selling the car at a ridiculous markup. With our Market Price Report you can quickly see how negotiable other dealer’s similar vehicles are. Definitely take the time to do that before making your final purchase.
At the end of the day, it’s incredibly important that you get a fair deal. The best way to ensure that happens is to do a bit of research in advance of agreeing to an out-the-door price.
Dealership fees and add-ons can add up to hundreds and even thousands of dollars, but that doesn’t mean you have to pay them. It’s no secret that dealer markups are ruining car buying. This guide to car dealer fees will help you understand common fees, spot hidden or fake charges, and learn how to avoid them.
Common Car Dealer Fees
When purchasing a vehicle, it’s essential to be aware of the legitimate fees and taxes that make up the out-the-door price. These fees are typically imposed by the government and vary by state or local jurisdiction.
Here’s a closer look at some of the most common legitimate fees and taxes associated with buying a car.
State & local taxes
Buying a car comes with a whole host of taxes. These include city, state, and county sales tax, personal property tax, and often a vehicle license tax, which has to be paid annually. These all vary from state to state, and in the case of sales tax, in even smaller jurisdictions.
Title, Tags, and Registration
In addition to taxes, there are a handful of other legitimate fees that are imposed by your local government. Title, tags, and registration fees are all par for the course when purchasing a vehicle.
The title fee is charged as a cost for the documents required to transfer the title, the cost for this fee can range from $4 up to $150 depending on the state.
Registration fees, charged to cover the cost of registering the vehicle under the buyer’s name, can vary wildly. Some states charge a flat fee, some charge based on weight, while others charge based on how old the car is. Our out-the-door price estimator will help you get a sense for how much your state’s registration fees will be.
Tag fees relate to the physical plates you need to carry on the vehicle. Again, this varies from state to state, but know it is another fee you should be prepared to pay.
Doc fee
Doc fees straddle the line of legitimate and illegitimate. Know that you can and should negotiate the doc fee with a car dealer. Also know that the dealer will never actually remove the fee from your buyer’s order, instead they will reduce the selling price of the vehicle by the same amount as the doc fee.
Doc fees change from state to state and from dealer to dealer. Many states cap doc fees to prevent dealers from exploiting them. For example you’ll never see a doc fee of more than $85 in California, whereas in Florida you’ll frequently find dealers charging upwards of $1,000 for a doc fee. In some states it’s the wild west.
Read the contract carefully: Make sure to review the sales contract thoroughly and ask the dealer to explain any unfamiliar fees or charges.
Look for inconsistencies: Compare the fees listed in the contract to the fees mentioned during negotiations or in advertising materials. If there are discrepancies, ask the dealer to clarify or remove them.
Research online: Check out resources like CarEdge to get an idea of what fees are typical for your area and vehicle type. This calculator and this guide to doc fees are great places to start.
Need some help? Our Car Coaches are ready to assist today! Learn more about how to get started.
Fake Fees to Avoid
These are the most common hidden fees you shouldn’t feel pressured to pay:
Some dealership fees add no value to your car and should be included with every new and used car at no additional cost. These are essentially fake fees that solely exist to make the dealership more money. Always avoid these fees:
Vehicle Prep Fee
Dealer Prep for Delivery Fee
Pre-Delivery Service Fee
Pre-Delivery Inspection Fee
Reconditioning Fee
Additional Destination Fee
Cash up-charge
It’s very important to remember that these fees add no value at all to your car, whether new or used. All of these so-called services should be included in the selling price of the vehicle, no ifs, ands or buts. Having trouble negotiating fake fees? Our CarEdge Car Coaches are always here to assist.
‘Almost Fake’ Fees
These car dealer fees add little value despite potentially costing hundreds or thousands of dollars. If you don’t want the product, these fees or ‘add-ons’ are always negotiable:
Etching – You can find it elsewhere for significantly less.
Nitrogen-inflated tires – The benefits are minimal, and air inflation works just as well.
Pinstripes – These are often overpriced and can be done cheaper elsewhere.
Paint protection – A wax job at a local shop will likely be more cost-effective.
Additional dealer add-ons – Beware of dealers trying to upsell you on unnecessary extras.
CarFax fee – If you’re engaging with a reputable dealer, there is no reason why you should have to pay for a CarFax or AutoCheck report.
All of these add-ons and dealership fees are negotiable. Not a single one of them is required, no matter what a salesperson tells you. They’re not like the taxes, title and registration fees that you should expect to pay.
Our CarEdge Car Coaches help thousands of drivers negotiate better deals on their car purchases every month. We’ve seen it all! Here are three examples of ridiculous dealer add-ons and B.S. fees that we’ve helped to negotiate off of the out-the-door price.
Who on Earth would agree to pay $3,000 for a protection package when you could apply those same products for a few hundred dollars elsewhere? Overpriced paint and protection fees are always negotiable.
Some dealers seem to think that if you can afford a new truck, you won’t mind paying a thousand dollars extra for unwanted dealer add-ons. Always negotiate these fees.
Two grand for a safety and security package? Nope, nope and nope.
And then you have this… a whole slew of dealership fees and add-ons that are VERY hard to justify.
Remember, You’re In Control
You should never feel pressured to pay for something that doesn’t add value. Our #1 tip for negotiating car dealer fees is to enter the deal prepared and empowered with knowledge. By being prepared, thoroughly examining contracts, and negotiating wisely, you can minimize surprise fees and secure the best deal possible.
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