Buying a used car

Step 1: Getting started

This section includes information about how to purchase a used car. The menu above breaks down the process into five steps. Click on the steps above to move throughout this section.

Use our checklist for a comprehensive look at the used car buying process.  

Your used car needs

The first step in buying a used car is to decide what type of vehicle meets your needs. Do you do a lot of driving? Do you haul tools or equipment? Is fuel efficiency important to you, or are you interested in a luxury vehicle? How much can you afford?

Answer these questions using the provincial government’s In the Driver’s Seat publication.

You can view used vehicles for sale by using the Auto Trader site, and searching by the type of vehicle you’re looking for as well as by price and region. Check newspaper classified ads in your city as well as used car lots.

Budget

Setting a budget will help narrow down your vehicle choices. But don’t forget to consider insurance, registration, fuel, maintenance and operating costs when you begin your planning.

Use Consumer Reports’ calculators and worksheets to determine what your lease or finance payments might be. The Canadian Automobile Association's Driving Costs brochure can help you calculate how much it costs to own and operate your vehicle each year.

Also, keep a reserve fund, as most used vehicles will need some repairs.

Step 2: Choosing your vehicle

 

After you’ve narrowed it down to a few of your favourite vehicles, it’s research time. Gather general used vehicle buying information on the reliability website. Look at model ratings, reliability information, owner satisfaction and fuel economy reports. Compare like vehicles, weighing their options, pricing, benefits and drawbacks.

 

Used vehicle pricing

 

Search for used vehicle prices using CAA’s new member-exclusive Gold Book service.

Also use CAA's member-only Black Book service as another value resource. Add 10 per cent to the price for Alberta vehicles. Also note that values are available for vehicles 10 years old and newer. You can also use VMR Canada to research market values for used vehicles that are 13 years old and newer.

Recalls

Check to see if the vehicle you're interested in has been recalled. Search Transport Canada’s vehicle recalls database. The database allows you to search by vehicle name and year.

Crash ratings

Find out what the vehicle’s crashworthiness rating is by visiting the IIHS (Insurance Institute for Highway Safety) and NHTSA (National Highway Traffic Safety Administration’s) websites. Does the vehicle perform well in frontal, rear and side impact collisions?

Reliability

How reliable is the vehicle? It’s important to check a variety of information sources before making your final decision. This will allow you to compare the vehicle’s good and bad qualities.

Start your reliability research by checking the Driving.ca website. The site provides comprehensive Canadian information about new and used vehicles as well as pricing details.. The site provides comprehensive information about used vehicles as well as pricing details.

Canadian Driver is also a Canadian vehicle information source that features vehicle test drives, reliability reviews as well as pricing information for new vehicles.

Compare vehicle features using MSN. The site includes reliability information, vehicle reviews and budget calculators.

Review road tests for various used vehicles at the Consumer Guide website. Gather full details of a used vehicle's safety, reliability, pricing and more, and compare it against other vehicles in the same class.

Fuel efficiency

Is the vehicle good on gas? Natural Resources Canada provides a comprehensive list of vehicles ranked according to their fuel efficiency. Search by year, manufacturer or type of fuel to find the best fit for you. The ratings will provide a guide for the vehicle's fuel efficiency rating, however, it does depend on driver behaviour, weather, style of vehicle and maintenance.

Insurance

Once you've narrowed your choices down to three or four different vehicles, compare what it will cost to insure each of the vehicles. Insurance costs can vary depending on the make, model and features, so it's important to gather all of the information before you make your final purchase. Get a quick auto insurance quote here.

Step 3: Shopping for your vehicle

Test drive

After you’re done researching, it’s time to view the vehicle and take it for a test drive. Set aside one day so you can drive more than one vehicle, which makes it easier to compare.

Take a friend with you - they may notice things you don't. It can be helpful to get a second opinion.

A test drive allows you to get a sense of the vehicle’s characteristics, handling and options. It should last 30 to 45 minutes and duplicate the kind of driving you normally do, including some highway driving. It’s important to be objective. Carefully determine whether or not the vehicle meets your needs. Use the Consumer Reports’ checklist to help. Take a notepad and jot down your impressions of the vehicle as soon as you’re finished, while your thoughts are still fresh.

Vehicle history

Obtain lien search and/or vehicle history reports on the vehicle you’ve selected before making an offer to purchase. A vehicle history report is important to have, because it will tell you whether the vehicle has been in a collision, if there are any liens on the vehicle as well as if it has been stolen. 

A CarProof VERIFIED™ report searches vehicle records throughout Canada and the United States. It also includes information about whether the vehicle has been stolen, rebuilt, salvaged or written off. The report also contains Canadian lien information.

A CARFAX report searches records throughout Canada and the United States, with a focus on American information. It's especially important for Canadians who are thinking of buying a used vehicle from the United States.

Note: Beware of odometer fraud when buying a used car. The National Highway Safety Administration in the United States reports more than 450,000 vehicles sold with false odometer readings.

Vehicle inspection

Also arrange for an independent mechanical inspection, at your own cost. Visit an Approved Auto Repair Services facility before buying the vehicle, where a good mechanic can spot any problem areas. This will help you know what repairs are needed. Tires, belts or radiator hoses, brakes or a new battery are common replacement items. An mechanical inspection will also tell you whether the vehicle has been in a collision. Having this information may give you extra bargaining power.

A professional opinion can be valuable in estimating interior repairs, too. A car with worn or damaged fabric but in good mechanical condition may be a good investment.  Upholstery burns and tears can usually be repaired at a reasonable cost by an upholstery shop.

Update: As of May 14, 2010, if you are buying a used vehicle from a dealership in Alberta, the dealership is required to conduct a mechanical fitness assessment test. There is no cost to consumers. Ask to see the results of the test before purchasing from a used car dealer. Read more on this test.

Caution: Be wary if the vehicle owner resists a vehicle inspection. This can indicate the seller may be hiding something.

Step 4: Making the deal

Negotiating

If you’re serious about the vehicle, make the seller an offer, leaving some room for bargaining. Remember that most sellers leave some wiggle room in their advertised price. If the seller counters your offer with an unrealistic figure, you may want to cancel the deal. Make sure you indicate on any written offer the deal was cancelled.

 

Before signing an offer, include any special conditions you want to be part of the deal, or things the seller has promised you, like repairs. Don’t sign the offer unless you’re really serious about the vehicle, want it and are prepared to accept the specified deal.

Contract

Read and understand the contract completely before signing anything. Also be familiar with your rights and responsibilities when leaving a deposit and signing a bill of sale. Signing a sales offer and leaving a deposit represents your commitment to purchase and is legally binding. The seller has the right to keep your deposit if the deal is not completed in order to cover his/her costs. Write in the offer that the deposit is fully refundable in the event the deal does not go through.

Deposit

Most sellers will require you to leave a deposit. The remainder of the payment is usually in the form of a money order or bank draft.

Bill of sale

Download a Bill of Sale. Make sure the contract includes: your name and address; seller’s name and address; make, model and year of vehicle; VIN; odometer reading; price and how you’re paying; special conditions; any other promises, warranties or statements; certificate of mechanical fitness.

To protect yourself against identity theft, only include the necessary information like your name, address and the vehicle information.

Consumer rights

Learn how to protect yourself as a consumer before signing anything. Read our consumer tips section, which includes information about signing a contract, refunds and exchanges and warranties.

Step 5: After the deal

Once you’ve made the full payment, fill out a bill of sale, in duplicate. Ensure both forms are filled out identically. Keep a copy of the bill of sale. Before you take possession of the vehicle, visit an AMA registry to register the vehicle. Put your plates on the vehicle when you take it home. Make sure you inform your insurance company immediately.

Insurance

You will also need to get insurance for your vehicle. Get a quick and easy auto insurance quote in three steps, online. Find out what personal auto insurance is, as well as coverage options. Arrange and get proof of insurance before picking up your vehicle.

Registry

You have 14 days to change the registration over to your new vehicle. In the meantime, you will need to carry the bill of sale with you and proof of insurance. If you plan to sell your old vehicle, you cannot switch the plate back and forth between your new and old vehicle. It is best to buy a new plate for the newly-acquired vehicle.

Find out what you need to register your vehicle.