How to Buy a Car From a Private Seller

Updated on March 12, 2024

At a Glance

  • Buying from a private seller takes less time, provides a level playing field for negotiations, and often offers better prices.
  • No financing options, no warranties, no protection from lemon laws, inability to cancel the sale, and no option to leave bad reviews are drawbacks of private seller transactions.
  • To buy a used car, determine your budget, build a list of options, compare prices, narrow your search to local cars, check the vehicle’s history, contact sellers, test drive the cars, get the car inspected, negotiate the price, and complete the paperwork.
  • Remember to buy a car with a real title, check for liens, and obtain car insurance before driving off.

Buying a car from a private seller is quite different compared to buying a car from a dealer. It comes with a lot of uncertainty and you may find it hard to trust this deal, but you can’t help feeling attracted to the lack of taxes and better price. How to buy a car from a private seller in a safe manner?

If you’re worried about buying a car from a private seller, this article will help you deal with the situation accordingly and make the deal safely.

Should You Buy a Car from a Private Seller?

Is it a good idea to purchase your new car from a private seller? It’s not uncommon to have a lot of concerns. Buying cars from private sellers has advantages and disadvantages, and you can choose by considering these things.

Pros of Buying from a Private Seller

It Takes Less Time

You don’t spend that much time when you buy from a private seller as opposed to buying from a dealer. So, you will probably be able to pay for the car immediately without wasting more time. This is because the seller just wants to get the money and be done with it. It’s a great thing when you’re in a rush to get a new car.

Meanwhile, professional dealers will take longer to sell you the car, and in some cases, they may even turn down your lower offers.

Level Playing Field

Professional car dealers are already used to doing this and they have most likely sold a lot of cars in the past. Conversely, you’ve only sold and used very few cars, making you more inexperienced. Buying from a private seller is thus more convenient because both of you have the same experience, which puts you on the same level. This way, you can even negotiate in a better way.

There Are Better Prices

When you buy from a private seller, you will end up paying less simply because there aren’t any dealer fees, and there won’t be any additional warranties to worry about. This is the best thing when you are someone who doesn’t have a high budget.

Cons of Buying from a Private Seller

No Financing Options

Buying a car from a private seller means you will have to pay for it upfront. It’s highly unlikely to get credit for purchasing a car this way. It may only be possible if you have a great relationship with a credit union or bank already, which might allow you to get a personal loan or car loan.

There Are No Warranties

Unlike a professional dealer, a private seller will not give you any warranty. This is not ideal if you are scared the car might have defects after a while. You may only be able to transfer a warranty from the seller if the car is not that old and if the mileage is still pretty low.

No Protection from Lemon Laws

Usually, you are protected under the lemon law when you buy a defective vehicle. Unfortunately, this doesn’t apply if you buy the car from a private seller. Only certain states extend their lemon laws to used cars. Even in this case, private sellers may be excluded from the matter.

You Cannot Cancel the Sale

While you may be able to cancel the purchase from some professional dealers, this isn’t possible when you buy from a private seller. You simply pay and get the car, and that’s it. There’s no way to go back.

You Cannot Leave Bad Reviews

With a professional dealer, you have the opportunity to leave bad reviews if the car you buy isn’t what you expected. You cannot do this with private sellers.

How to Buy a Used Car

If you want to get a used car, here are some steps you should take:

Figure Out What You Can Afford

Considering used cars may require more attention due to possible issues that may arise, you don’t want to spend too much on one from the get-go. You’ll have to spend enough money on reparations, so you should at least try to save some money when buying your car.

Analyze your budget and consider how much you’re willing to spend. Also, if you take out a loan for the vehicle, you should make sure the car payment isn’t over 10% of the take-home pay. Check the options you have for cars and see if you find something that fits your budget.

Build a List of Used Cars for Sale

Don’t be too focused on one particular car brand. Look into more options and see if you find something you may be interested in. Ideally, you should build a list with different car targets. Your list should contain at least three cars that you can afford.

Compare Prices

Check out the prices for each car and compare them. If you find a car model that got your attention, look for similar offers for the same car and see if the pricing is different. It’s always best to find the best deal.

Narrow Your Search to Local Cars

Finding a car near your local area will make it easier to get it home. If you’d rather buy from your area, check out a used car inventory page like the one from Edmunds. It will tell you if there’s something you should look into.

Check the Vehicles’ History

If you’re buying a car from a stranger, you should always check the history of the vehicle. It will tell you a lot of things that may influence your decision of purchasing it.

Contact the Sellers

When you find the car you want to buy, reach out to the seller. This allows you to establish a good relationship and talk more about the vehicle. If everything is okay, you can decide to meet up so you can test the car.

Test Drive the Cars

Testing the car is the best way to find out if it works alright and if it’s what you want. You can check the comfort of the seats, the amount of space, the tires, doors, brakes, air conditioning, indicators, brake lights, headlights, and everything of relevance.

Get the Car Inspected

If you’re almost convinced you want this car, you should ask a mechanic to inspect it first. A mechanic will know for sure if this is a good decision or not, and he may discover something that you didn’t notice.

Negotiate a Price

Try to negotiate a price with the seller. Make a decent offer if you’re aware of how much you can afford, and try talking to the seller respectfully.

Complete the Paperwork

If you’re buying the car, the seller should transfer the registration and title of the vehicle to you, and close the deal. Find out if there are any post-registration fees you will have to deal with. You also need to make sure you have insurance for the car.

Tips for Buying a Car from a Private Seller

Here are some tips to buy a used car safely:

Always Buy a Used Car with a Real Title

When you see a used car from a private seller sold for a price too good to be true, it may be because the seller has no title. Never buy a car without a title, because no title means no ownership.

Check the Vehicle’s Title for Liens

When a car title has liens, it means that there is a financial stake that a third party may have on it. You have to check if there is any lien, and that is possible by asking to see the title first.

Get a Car Insurance Policy Before Driving Off

Before you leave and enjoy your new car, you should get an insurance policy. Some states actually enforce it. Look for companies that offer insurances and compare the rates, and pick the one that is the best for you.

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Getting a car from a private seller can be risky, but you will not have issues if you take the right steps and precautions. Follow all the tips here to safely purchase a used vehicle.

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Frank Gogol

I’m a firm believer that information is the key to financial freedom. On the Stilt Blog, I write about the complex topics — like finance, immigration, and technology — to help immigrants make the most of their lives in the U.S. Our content and brand have been featured in Forbes, TechCrunch, VentureBeat, and more.

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