Every couple months, we try to give back to the community by hosting free car care clinics at our shop. Our latest workshop was all about buying a pre-owned vehicle; an evening where we hoped we could help prevent at least a couple folks from making some common car-buying mistakes. Even though we earn a living repairing car problems, we don’t want to see anyone end up with an unreliable “money pit” of a vehicle! For us, there’s a lot more satisfaction in helping our clients maintain a safe, reliable vehicle that requires a more reasonable amount of upkeep.
So how do you tell a worthwhile vehicle from a bad one? For anyone who wasn’t able to attend our last clinic, we thought we’d share some of our thoughts from that event in this post. We’ve organized our thoughts into several different categories, so please read on!
Choosing the Right Vehicle
From small hatchbacks to SUVs and full-size trucks, there are lots of transportation options out there! You probably already know what kind of vehicle will fit your needs, so we won’t spend much time on this. Here’s our advice when it comes to vehicle selection:
Make sure the vehicle fits your budget.
The more a vehicle costs to purchase when it is new, the more it costs to maintain over time. For a service provider such as us, there’s almost nothing more challenging than trying to assist someone who is driving a BMW on a Honda Civic budget. If you can’t afford to maintain a certain vehicle, it won’t last and you won’t be happy with it. (See the whole next section for more on this.)
High end cars that are too good of a deal:
We’ve seen this situation a few times: A client is looking for a used vehicle, and let’s pretend they have a $6000 budget. They search online and discover that they can buy a 2010 Honda Civic; a 2009 Toyota Corolla, or a 2000 Audi A4 for that money. “Why would I drive a Honda when I can drive a Audi?”, they think. They soon discover that there’s a reason why the Audi was so cheap: Most high-end vehicles depreciate quickly because nobody can afford to own/maintain them once they get older. The Civic or the Corolla would have been a much better deal
Maintenance and Ownership Costs
On average, it costs about two thousand dollars per year to keep a vehicle properly maintained – but some cars will leave you spending a lot more. Naturally, we’d like to spend the lowest amount that is reasonable; so how do we find a vehicle with a cost of ownership that matches our budget? Here are our tips:
As a general rule: The larger the vehicle, the more it costs to own.
The cheapest vehicle to own (when considering maintenance, insurance and fuel costs) is a front wheel drive car with a small engine. Below, we’ll list the most common vehicles types organized by their cost of ownership, with the least expensive vehicles coming first, and the most expensive listed last:
- Compact car (sedan, hatchback, coupe)
- Midsize/full size car
- Crossover or small SUV (front wheel drive)
- Crossover or small SUV (all wheel drive)
- Large SUV
- Midsize truck (Ford Ranger, GMC Canyon, etc)
- Half-ton truck (Ford F-150, Ram 1500 etc)
- Heavy duty truck (Ford F-350, Ram 3500 etc – gas engine)
- Heavy duty truck (Ford F-350, Ram 3500 etc – diesel engine)
How common is the vehicle? Will finding replacement parts be a problem?
When it’s a challenge to find replacement parts for a vehicle, this not only makes repairs more expensive but also more time-consuming as well. Suzuki vehicles have been an example of this ever since the automaker pulled out of the North American market in 2013. Even vehicles from mainstream manufacturers can cause challenges when they are sold in Canada but not the United States – such as the Nissan Micra or Mercedes B200. Any vehicle that has been imported from overseas is likely to cause parts headaches, as can many older (15+ years old) European cars.
Is the vehicle easily serviceable?
Expanding on the idea above, let’s look at service instead of parts. Finding someone local to maintain a North American or Asian vehicle shouldn’t be an issue. But if you need a more involved repair, is there a dealership (or dealership-level independent, such as My Garage) nearby?
Check the tire size.
Some vehicles are equipped with fancy tires and wheels that look great, but also cost a fortune. We recently helped a client who loves the appearance of the 22″ wheels on her Ford Edge SUV, but was shocked to find out that the tires cost over $500 each when it was time to replace them. If spending two thousand dollars on tires doesn’t tickle your fancy, then this might be something worth checking out before you buy.
Have a reasonable price expectation.
The days of buying the $500 “beater” that some of us remember from our childhood is long gone. Those $500 cars cost $2500 now – and they still need just as much work as they did back then! Any vehicle purchased for less than $5000 should be expected to require at least a couple thousand dollars of work, and even a $15,000 used vehicle usually needs something. For that reason, we always recommend not to use your entire vehicle budget up on the purchase price.
Inspecting the Vehicle
Okay, so now you’ve found a car that looks like it will fit your needs, and your budget. How do you know if it’s the one? We strongly recommend having every vehicle properly inspected by a licensed professional prior to purchasing it, but there are quite a few checks that you can do by yourself first, to avoid wasted time and inspection costs.
Checking the fluids:
Fluid levels and conditions are an easy inspection that you can do yourself when looking at a used vehicle. Is the engine oil full and clean looking, or is it low and black? Because oil changes are something that even the poorest vehicle maintainers usually get right, a vehicle that’s low on oil isn’t a good sign! Is the brake fluid low? Low brake fluid usually indicates worn brake pads, which means the brake should be inspected. Our website has a whole section about fluid maintenance if you’d like to learn more about what these fluids should look like.
Does the vehicle have a timing belt? When was it last replaced?
Many cars, minivans and some SUVs have a timing belt inside their engine. This belt must be replaced every 100,000 – 160,000 km. Massive engine damage can result if the belt isn’t replace on time and it breaks. Unlike the fan belt or serpentine belt, a timing belt isn’t visible from the outside of the engine and isn’t easy to inspect. Start by determining if the vehicle has a timing belt by asking an automotive professional such as us; checking the owner’s manual; or even searching the internet. If it does, then you need to find out when the belt was replaced last. If the previous owner of the vehicle doesn’t know, we always recommend replacing the timing belt right away. (Then you’ll have a good starting point from which to count mileage towards the next replacement.)
Do all of the warning lights work?
Perform a “bulb test” by turning the ignition to the “run” position without starting the engine, and then check to make sure all of the warning lights (Check Engine, ABS, etc) illuminate. We’ve seen plenty of vehicles where a warning light has been on so long that it burns out, and everything looks fine again. Worse yet, we’ve also seen a slippery seller remove a fuse or a bulb in order to disable a warning light.
Is the engine too clean?
Under the hood, an engine bay that’s unnaturally clean compared to the rest of the vehicle can signal an engine that was cleaned just for the sale; sometimes to hide fluid leaks. A professional inspection from underneath will reveal the truth, but you can also run your fingers along the underside of hoses or brackets to check for grease that might indicate a poorly maintained engine.
Assuming the vehicle you’re considering looks okay, the next thing you should ask about are maintenance records. These are all the invoices and receipts that prove servicing of the vehicle. We find that – usually – a person who keeps a more organized and complete set of maintenance records also takes better care of their car. As you browse through the maintenance records, here are three things to pay attention to.
What type of vehicle owner are you dealing with?
Examining the type of service the vehicle has received will reveal how well it has been cared for. Does the vehicle only go in for service when something breaks, or do the records suggest an interest in preventative maintenance as well? Look through the receipts for items like fluid changes, filter changes, belt replacements and other maintenance items that come with proper vehicle care.
Where has the vehicle been serviced?
Take note of what type of shop has been servicing the vehicle. Where are the oil changes being done? We find that cars maintained in dealerships or general service shops such as ours are almost always in far better condition than those maintained in “quick lube” shops. Many drivers who frequent the drive-through lube shops are – sometimes unknowingly – doing a great job maintaining 20% of their car, while the other 80% never gets inspected and is neglected.
How many shops have serviced the vehicle?
Has most of the vehicle’s maintenance been done with 2 or 3 shops, or do the maintenance records contain 30 different receipts from 17 different businesses? An owner who bounces around from shop to shop is often chasing the lowest price, and less interested in forming a relationship with a service provider that benefits them and the vehicle over the long term. This translates into a vehicle that’s not as well taken care of. Plus, since no one shop gets to establish a service history for these “floater” vehicles, it’s also more likely that scheduled maintenance items may be missed or overlooked.
Get it Inspected!
Once you’ve found a used vehicle worth buying, it’s always a good idea to have a pre-purchase inspection performed by a trustworthy mechanic. (We’d be happy to help with this, of course!) These inspections are usually the best $100 or $150 that you can spend when car shopping, and can sometimes help you avoid a whole world of trouble.
We’re often asked: “What if the seller isn’t willing to bring the vehicle somewhere for an inspection?” Our experience is that anyone who is serious about selling a quality vehicle will have no problems letting you inspect it. If a seller refuses the inspection, this is usually a red flag and a warning that you should move on.
Don’t Forget a Lien Check
If you’re purchasing a vehicle with a value of $10,000 or more, there’s a chance the previous owner might still be making payments on it. If they don’t clear up their balance owing on the vehicle, then you might find yourself with a bank or financial institution coming after your new car! To see if a vehicle still has a loan registered against it, you can perform a lien search at a registry office. These searches can also be completed online, and are now included in vehicle history reports such as a CarFax Report. Lien searches have never been more important than they are today. With the growth of 7-8 year financing on new cars and low credit/no credit used car dealerships, it’s not uncommon to see liens registered on 10 year old cars.
Aftermarket Extended Warranties
Okay, so you’ve found the perfect pre-owned vehicle. If you’re buying it from a dealership or a used car lot, chances are they will try to sell you an extended warranty plan. These plans are very different from the factory warranty that comes with a new vehicle, so car buyers expecting a similarly smooth experience are usually very disappointed when the time comes to use the warranty. Here are some important aftermarket warranty facts that many people don’t know:
- Authorizing a claim is a literal negotiation: we try to get as much of the repair covered as we can for the client, and the warranty company tries to pay for as little as possible. We usually end up having to meet somewhere in the middle.
- These warranties usually will not cover the entire cost of a proper repair. For example, in the case of a leaking water pump, we’ve seen the warranty company cover the pump itself and the labour to replace it, but not the antifreeze to fill the engine back up. The vehicle usually leaves our shop with two invoices: about 2/3 of the repair is covered by the warranty, and the other 1/3 is paid by the client.
- Unlike a new car warranty, these plans do not cover towing or diagnostic charges.
- Most warranties contain a claim limit. That means that even if you’re covered for $5000 in engine damage, you can only use $2000 per repair. If you experience a $4000 failure in this situation, you would only be able to claim half of it even though it’s under your $5000 policy limit.
- Many of these warranties are conveniently written so that the parts which normally never fail are covered, but not the parts that do fail. For example, we’ve seen plans that cover the OIL PAN itself, but not the OIL PAN GASKET. You need to read the fine print on the policy.
- In many cases a used car lot will make more profit from selling the extended warranty than they do selling the car!