The Complete Used Car Buying Guide

1

Define Your Needs & Budget

Before you look at a single car, get crystal clear on what you actually need. Most people overspend because they buy what they want, not what they need.

The 20/4/10 Rule

20% down payment — Keeps you from being underwater
4 years or less — Maximum loan term
10% of gross income — Max monthly payment (including insurance)

💡 Pro Tip

Your total car costs (payment + insurance + gas + maintenance) should be under 15-20% of take-home pay.

2

Research the Right Vehicle

Focus on reliability, total cost of ownership, and resale value — not just the purchase price.

Best Bets by Category

Compact SUV: Toyota RAV4, Honda CR-V, Mazda CX-5
Midsize SUV: Toyota 4Runner, Honda Pilot, Lexus GX
Truck: Toyota Tacoma, Toyota Tundra, Ford F-150
Sedan: Toyota Camry, Honda Accord, Lexus ES

⚠️ Avoid This Mistake

Don't buy a European luxury car out of warranty unless you have a repair budget. A $40K used BMW can cost $5-10K/year in maintenance.

3

Find the Real Market Value

This is where most buyers get ripped off. KBB shows estimated retail values — what dealers want you to pay. You need to know what dealers actually pay.

💡 The CarGence Advantage

CarGence shows you real transaction data — what dealers actually paid at wholesale. This is your floor price. The gap between wholesale and listing? That's dealer markup, and it's negotiable.

4

Inspect Like a Pro

Never buy a used car without a thorough inspection. Always get a pre-purchase inspection (PPI) from an independent mechanic.

✅ Quick Inspection Checklist

Check body panel gaps — uneven gaps = accident repair

Look for paint overspray on rubber seals

Check all four tires for even wear

Pop the hood — look for leaks, check fluid colors

Start the car cold — listen for unusual sounds

Test drive: acceleration, braking, steering

5

Negotiate & Make Your Offer

Knowing the real value is your power. You're not guessing — you know exactly what the dealer paid.

The CarGence Framework

Opening Offer: Start at or slightly above Real Value (10-15% below asking)
Target Price: Aim for 5-8% below asking
Walk-Away Price: Your absolute maximum — stick to it

📝 Opening Script

"Hi, I'm interested in this vehicle. Based on current market conditions, I'd like to offer $[OPENING]. I'm a serious buyer with financing ready and can close today if we agree on price."

📝 Counter Script

"I appreciate the counter. Similar vehicles are trading in the $[REAL VALUE] - $[TARGET] range. I can come up to $[TARGET], but that's my ceiling. Can you work with me?"

6

Handle Financing Smart

Never negotiate monthly payments — that's how dealers hide bad deals. Always negotiate the out-the-door price first.

Get Pre-Approved First

Your bank or credit union (usually best rates)
Online lenders (LightStream, Capital One Auto)
Dealer financing (use as backup or to beat your rate)

⚠️ F&I Office Traps

Say NO to: extended warranties, GAP insurance from dealer, paint protection, fabric protection, VIN etching. These are high-margin add-ons.

7

Close the Deal Right

You're almost there. Don't let your guard down at the finish line.

✅ Final Checklist

Review purchase agreement line by line

Verify out-the-door price matches what you agreed

Check for added fees or products you didn't agree to

Confirm VIN matches the car you inspected

Get copies of all paperwork

Transfer insurance before driving off

💡 Track Your Investment

Add your car to CarGence Portfolio to monitor its value. You'll get alerts when it's the optimal time to sell.