Used Cars: Buy From a Dealer or Private Seller?

In the age of smartphones and the internet, it's pretty easy to research used cars, But what should you pay attention to? And where should you buy the car? From dealer or private seller? 

Read here about the main differences between buying from a dealer or buying from a private seller and what you should pay special attention to.

Pros and Cons

Buy a Used Car From the Dealer

✔ Liability for Material Defects

✔ Often guarantee offers

✔ Some workshop-tested used cars

✔ Usually slightly higher purchase prices

Buy a Used Car From a Private Seller 

✔ Often more room for negotiation

✔ Usually cheaper purchase prices

✔ Usually no guarantee or liability for material defects

Buy a Used Car From a Private Seller

When buying a used car from a private seller, caution is required. If you are responding to an advertisement, find out about the vehicle and its potential weaknesses before the appointment. When visiting one of the major auto markets where impulse purchases are made, you should be careful not to have much time for research. 

If you are not very familiar with the subject yourself, be sure to take an expert with you to the examination. Suggest taking the car for a test drive at the repair shop or having it assessed by an appraiser before finalizing the purchase. If the seller responds to the appraisal request, that's a positive sign. If not, hands off! 

In the case of a private purchase, you must ask for information about the mileage or a promise that the car has not been in an accident. Check if there is a service book or checkbook, for example, to check whether the car has been checked regularly and whether the mileage on the odometer matches the value recorded by the Ministry of Transportation. 

In contrast to car dealerships, private sellers can exclude liability for vehicle defects, known as "material defects liability," in the purchase contract. When buying privately, you usually get the least amount of security and also have no warranty claims. You should have the biggest leeway here in terms of price.

Buy Used Car From Branded Retailers

Buying a used car from a reputable dealer is a sure bet. Because it can be assumed that the vehicles offered here have been tested and there is a test report that allows an objective assessment of the current market value.

Therefore, the car is inspected at the repair shop, so that the dealer can give you a reasonably used car guarantee. The offered cars have been thoroughly checked, so you can be sure that you are buying a reliable vehicle. A test drive should also be possible without problems. As far as the purchase contract is concerned, everything is sure to work out here. 

Of course, all of this is the price. Branded dealers usually charge the most for used cars.

Also, don't feel bad if you decide not to buy, despite intensive advice, lengthy sales pitches, and many concessions from retailers. You're not here to help the seller, you're here to find a used car that you really like.

Buy From a Used Car Dealer

The spectrum of independent used car dealers is huge. There are car dealers that specialize only in selling used cars, as well as many smaller dealers that you should be aware of. It is important to make sure you buy your car from a reputable used car dealer. 

Because even if it's a used car, when you buy that car, it's a new car for you. 

In the best case, your thrift dealer has a special points inspection system, and cars are distinguished by a used car approval stamp. The condition and function of the vehicle's components and systems are then examined. From the chassis to the braking system to the steering, make sure everything is in order technically and electronically. The cars offered there live up to dealer standards regarding brand - only at a much lower price. 

Another plus for the dealer: He offers an attractive used car guarantee and will exchange your old car on fair terms. Especially if you're not committed to a particular model or make, buying from an independent used car dealer makes sense. 

If possible, formulate a list of criteria that must be met by your new vehicle, such as the maximum number of kilometers driven, horsepower, whether it is a diesel engine or gasoline engine, and check whether the car is experiencing an accident.

This way, you make the choice easier for you and the retailer. You benefit from a wide range of offers, and in the best case, you get quality from a brand-name dealer at a better price. 

When buying from a used car dealer, the following generally applies: You will have a standard purchase contract issued to you, which must be completed in full. Don't forget to get all warranties and other agreements in writing. This also applies if the contract refers to defects in the vehicle. 

The seller is not responsible for any damage known to both parties at the time of purchase. Reputable used car dealers will do all of this without you having to ask them. Be wary of sellers brokering used cars "on behalf of the customer." Because then the same rules apply as when buying privately, and you may be at a disadvantage if undetected defects are evident in your new dream car. 

Important: When purchasing a used car, the warranty cannot be waived by the dealer with a comment such as "Purchased as is" in the purchase contract. These clauses are void.

Lower Price or Safer?

If you buy a car from a used car dealer, you can claim warranty rights in case of damage. Vehicle defects that already exist at the time of purchase will be replaced by the seller. Under what conditions and in what form is this regulated in various countries in material defects laws.

But be warned: Private sellers can also exclude liability for these defects. If something goes wrong with the car after the sale, you as the buyer must prove that the seller deliberately kept it secret.

When you buy a used car from an individual, you don't necessarily have the same safety as the dealer. However, cars from dealers are also more expensive: According to market data, individually used cars sell for about 8% below dealer prices.

In general, you should listen to your gut feelings when buying in person: Does the seller make a serious impression on you and not put you under time pressure with car sales? That's a good sign. Also, check the papers that came with the car – the inspection booklet provides useful information about the condition of the vehicle.

Trust in The Dealer

It is in the dealer's interest to educate the buyer about the condition of the car, because the dealer must repair any damage that occurred when the car was sold free or paid for, unless otherwise stated in the contract, of course. By law, if the damage occurs within the first six months after the vehicle is shipped, the dealer generally has to prove that the damage did not exist at the time of purchase.

Of course, this can provide a potential buyer with a certain level of security; after all, not everyone knows so much about cars.

Trusted Dealer Checklist

✔ The seller doesn't pressure you

✔ The seller gave exact answers to questions about the damage

✔ Seller ready for used car inspection

✔ The final inspection report is available

✔ Previous vehicle ownership information

✔ There is a complete inspection booklet

✔ Vehicle information was checked recently

Guarantee Contract and Seriousness

In addition to used car liability, dealers often offer other warranties that do not cover legal liability. Guarantees are not legally required but are offered by the dealers themselves. They can also cover wear and tear, or defects that only appeared after purchase. 

Please note, however, that warranty contracts with different dealers can vary greatly. Some sellers are more generous and include more damage than others. The warranty often covers a reduced or only covers certain vehicle parts. 

Therefore, you must know the warranty contract well before you sign the contract to buy your car. Apart from that, you can also make sure that the car has been inspected by a repair shop and always ask for a detailed damage report.

Conclusion

Whether you buy from a retailer or from a private seller should be carefully considered. It is important that you know what to look out for. Take your time, look at various offers, and talk to friends or family. This will help you to define your own needs more clearly and ultimately make the right decision for you.