Used car sale transaction process

[mabuhay]

You do realize that the $7-10k "up the scale" car the dealer is selling you is the same 4k car sold in private sales on craigslist etc. They just might wash it a little better.

Nah, the margin isn't that big.. the big dealers want to move cars. It's a volume game. Some are trades, some are auction cars, but a reputable dealer doesn't want to buy and sell junk and deal with the fallout..And you can look at 10 or 20 at a time. How long does that take using Craigslist? And they're not gonna try and pass a bad title or whatever.

OP Also consider used rental cars, most of them are actually pretty well maintained these days.

 

[JoeWras]

Nah, the margin isn't that big.. the big dealers want to move cars. It's a volume game. Some are trades, some are auction cars, but a reputable dealer doesn't want to buy and sell junk and deal with the fallout..And you can look at 10 or 20 at a time. How long does that take using Craigslist? And they're not gonna try and pass a bad title or whatever.

OP Also consider used rental cars, most of them are actually pretty well maintained these days.

I agree with what you are saying. Sure, there is the occasional diamond in the rough of an unsophisticated private seller offering up a creme puff, but they are rare, and the two I tried for sold in about 15 minutes (not exaggerating). And in the opposite direction, I don't see mainstream dealers trying to deal with auction cars at all. They leave that to the little guys, and their practices vary all over the place.

In the 7k to 10k area, private sellers and dealers are pretty consistent in their listed offerings. The difference is dealers will still try to pack on $698 documentation fees, and private sellers may deal easier.

I'll say this: exploring this process has been an interesting activity. I mean that in a neutral way. It may be a bit frustrating at times, but I'm also learning a lot about how markets work, how unscrupulous people work, and so on. Very interesting. Good exercise for the brain and social skills.

 

[Qs Laptop]

I'll say this: exploring this process has been an interesting activity. I mean that in a neutral way. It may be a bit frustrating at times, but I'm also learning a lot about how markets work, how unscrupulous people work, and so on. Very interesting. Good exercise for the brain and social skills.

The used car market is in an upheaval. Low inventory and high demand. There are not very many leased vehicles coming off leases and becoming available as used cars. The inventory of new cars is just now recovering from the pandemic. Auction vehicles have been overpriced for months and are just now coming down. (Info courtesy of CarDealershipGuy @GuyDealership on Twitter)

 

[finnski1]

Nah, the margin isn't that big.. the big dealers want to move cars. It's a volume game. Some are trades, some are auction cars, but a reputable dealer doesn't want to buy and sell junk and deal with the fallout..And you can look at 10 or 20 at a time. How long does that take using Craigslist? And they're not gonna try and pass a bad title or whatever.

OP Also consider used rental cars, most of them are actually pretty well maintained these days.

Not buying it. Around here the dealers are making a killing on used cars. They are pretty much selling what ever they can get for big markups from trade in value.

 

[JoeWras]

Both the used car and real estate markets woke up a bit in February. Used car prices had flatlined, and are now rising a bit again. I'm definitely seeing an inventory squeeze.

The whole reason I started looking was because inventory grew, and as I've been looking, I'm watching it shrink.

The Twitter Car Dealer Guy says it is because of tax refunds. I think he is spot on.

Same for real estate. Seems like the market has gotten more active. Perhaps some paused hoping rates would drop and now realize that's not happening soon.

Speaking of rates... The rate rise feeds back on the used car market too. First it was inventory shock causing people to scavenge the used market, now it is affordability.

I guess I can just make do with what I have. I saw a nice vehicle at a local small dealer and wondered why it was such a deal. Then I zoomed in on the photo and saw the body cancer. They posted the carfax, and sure enough, this guy got it on auction from the Philly area.

 

[finnski1]

Both the used car and real estate markets woke up a bit in February. Used car prices had flatlined, and are now rising a bit again. I'm definitely seeing an inventory squeeze.

The whole reason I started looking was because inventory grew, and as I've been looking, I'm watching it shrink.

The Twitter Car Dealer Guy says it is because of tax refunds. I think he is spot on.

Same for real estate. Seems like the market has gotten more active. Perhaps some paused hoping rates would drop and now realize that's not happening soon.

Speaking of rates... The rate rise feeds back on the used car market too. First it was inventory shock causing people to scavenge the used market, now it is affordability.

I guess I can just make do with what I have. I saw a nice vehicle at a local small dealer and wondered why it was such a deal. Then I zoomed in on the photo and saw the body cancer. They posted the carfax, and sure enough, this guy got it on auction from the Philly area.

Hey. Sorry not trying to be a wet blanket.

I agree with you about rust . Can't stand it. Has caused me to sell early in the past. Living in NH I now undercoat my vehicles every Fall.

 

[JoeWras]

Hey. Sorry not trying to be a wet blanket.

I agree with you about rust . Can't stand it. Has caused me to sell early in the past. Living in NH I now undercoat my vehicles every Fall.

Ignoring my own rules, I considered pushing through since it was just a bit of external rust, right? Then a close study of the Carfax showed that a ton of work was done replacing all kinds of suspension parts, brake calipers, etc. That's not good.

 

[MalteseFalcn]

Hello. As for the scammers, in the past I've proposed meeting up to exchange cash or valuables in the public parking area at the local state police barracks. That'll keep the ne'er-do-wells far away.

Won't help with issues of mechanical liability in your case, but it should provide sufficient environment for safety.

 

[JoeWras]

I moved up in price and have a test drive with someone today. This is through Autotrader, which has a communication and payment transaction platform. The seller has to pay a few bucks ($99) to get in, so it weeds out a lot of crap for the private sales.

We'll see how it goes. If we strike a deal, we may or may not use the platform for payment and car registration.

 

[JoeWras]

What about the test drive?

What about the test drive? How do you do it safely?

Do you throw them the keys and say "have at it" and keep some collateral? Drive with them?

---

I had my test drive with the proposed car last Sunday through the Autotrader platform, which basically documents everything, including the fact that I went through an ID check (similar to ID.me). This is more security than an Uber!

I felt good about it. Everyone else was suspicious.

DW insisted on coming along after reading about a few stories of test drive murders. Unknown to me, she had a battery charger in her pocket to use as a sort-of weapon. Meanwhile, on the other side of the equation, they came as a family and smothered us with witnesses. Mom drove with me, along with DW and one of their kids in the back. Dad followed closely with another kid in tow.

It was kind of hilarious because afterward we talked about it and everyone was so concerned but we all seemed to get along so well. If they didn't live 60 miles away, we'd invite them over for dinner.

I went forward with buying the car. It isn't done yet, as there is a little story there for another post (regarding titling and registration). We are using the Autotrader Private Seller Exchange platform which makes sure every box is checked, and it also allows various payment options (loans, credit cars, etc) which is held in escrow until every box is checked.

I'll update later. So far, I've been happy with this process and would do it again. I never thought I'd buy a used car, but here I go.

 

[Fermion]

This is why I really liked the experience at CarMax recently. Well, that and getting more money for our 3 year old van than we paid for it new.

 

[JoeWras]

This is why I really liked the experience at CarMax recently. Well, that and getting more money for our 3 year old van than we paid for it new.

Yep. It is a lot simpler for sure.

I was looking for an older vehicle for a specific purpose that will only last 5 years or so. Buying newer would not only be costly, but wasteful as my use case will cause some damage to the vehicle.

Turns out this kind of vehicle is really only available via private party, or the bottom feeder shady dealers. CarMax wouldn't touch this kind of vehicle.

 

[MC Rider]

When I have bought or sold in a private party deal, it has been cash, and meet at the sellers place. The last car I sold that way, me and the buyer sat in the car while I counted the cash of about $6,000. Test rides on a bike I am selling, only with all the cash in my hand first, and you drop it you bought it. Never had a problem.

 

[JoeWras]

So I bought a car via private sale

As I've hinted at in other posts like my scratch post, I bought a car! It was a private sale done through the Autotrader Private Seller Exchange platform.

I've already put a few hundred miles on the car and so far, I'm happy. It was high mileage and 12 years old. Of course, there are a few issues, most of which I knew about.

The Autotrader PSX platform acts as a kind of escrow exchange dealer. Essentially, the seller sells to PSX, then the buyer buys from PSX. The seller has to prove identity through "stripe", which is a bit like real.id. A serious buyer has to do the same. This involves showing your driver's license and selfie.

There are downsides and upsides to that. I'll let you decide.

However, at least you have some confidence in the process that people are serious and not just a bunch of scammers. One can communicate with the seller without being verified. After the deal, I asked the seller and he said he ignored non-verifieds and that's why I got the deal.

The test drive was interesting. I explained up thread.

The exchange of money and title was through the Autotrader PSX. I could pay via ACH, credit card, or even get a loan. I could also buy a "warranty," which I declined. They have stages of warranty from basic to full. I'm going to gamble on this, but not much based on DW's previous experience with these so called warranties, which frankly suck.

There are a series of checklists each party clicks through. It starts with the initial talk, all done anonymously. Then the test drive, which can be mostly anonymous too. Once you get to dealing, you click your price, and the seller can accept or deny. He accepted, and then you get into a more serious checklist. Theoretically, one can complete the deal at the test drive if the buyer pays right there (through the website), and you can print off a temporary permit if you are at FedEx or UPS store parking lot. We didn't do that because my seller had title issues... i.e., his registration lapsed.

So, I put it into Autotrader's court to resolve that. I paid, but the money wasn't released until the seller cleaned up his mess. You probably don't want to hear this, but I test drove an unregistered car. DW was a nervous wreck.

After he proved his title enough to Autotrader PSX, they allowed me to pick up the car. We still could have done it semi-anonymously, but decided we got along well enough that I picked it up at their house (busy family). It took a week for the seller to clean up his back taxes and other non-registration nonsense for Autotrader to be happy. They do not pay him until the title is clean, so that's worth it. Today I got the news it is good to go and I'll get the title via priority mail and have to finalize it with my DMV.

I'm still a slight bit nervous knowing the shenanigans with Carvana and their title issues, but I think it will be OK. I'll report if I have any problems, but I should get the title and then just get it to my DMV to issue in my name. I'm running with Washington State temporary registration (I live in NC). This is because Autotrader bought "TRED", which was an early app-based private exchange system, and that's what they use for PSX. TRED is a Washington State based company.

Assuming the final steps go well, I'd consider selling a car this way. It doesn't get the action that Facebook Marketplace gets, but it has a whole lot more checks and balances. It also gives you access to buyers who need to pay by credit. Sellers pay $49 for the ad, then $99 for the exchange (unless it is over $10k, in which they pay a small percentage).

Until this year, I never thought I'd buy a used car. I especially never thought I'd buy one from a private seller who lives 50 miles away. I never thought I bought a Honda.

I blame RobbieB 100%! I'm serious. I turned 60, found a real need for this specific car (actually a Minivan!), and I heard in my head "Joe, BLOW THAT DOUGH." So here I am. Most 60 year olds buy a Corvette. Some us buy minivans.

 

[fh2000]

This is why I really liked the experience at CarMax recently. Well, that and getting more money for our 3 year old van than we paid for it new.

In 2018, I bought 2 Toyota Corolla from CarMax. Both are 2015 year car, for about $15,000 each, one for each child.

Today, 5 years later, I checked on local CarMax again for 2015 Toyota Corolla, and the listing price is still around $15,000. I guess used car market is crazy right now.

 

[JoeWras]

It is.

 

[RobbieB]

I blame RobbieB 100%! I'm serious. I turned 60, found a real need for this specific car (actually a Minivan!), and I heard in my head "Joe, BLOW THAT DOUGH." So here I am. Most 60 year olds buy a Corvette. Some us buy minivans.

I appreciate the love, I really do -

Doing my best to turn you tightwads towards loosening the purse strings.

I always try to put up a good example;

Now if you really want to blow that dough!


That Autotrader thing sounds pretty good. Saves you from the Craigslist whackos

 

[MC Rider]

Very nice, Captain Robbie.