The Pros and Cons of Buying a Used Car from a Private Seller

So you’re ready for a new set of wheels? How exciting!

Whether you buy from a dealer or a private seller, choosing a used car can be a great way to save money. Private sellers will usually ask a bit less; however, it can be tough to tell if you’re getting a good deal.

Here are four key factors to consider as you weigh your options.

Nearly New vs. Promising Fixer-Upper

There’s something to be said for the experience of bringing home a shiny “new” car. If that’s what you’re after, buying from a dealer is probably your best option. If you purchase a certified pre-owned (CPO) car, the dealer will usually do a thorough reconditioning to make the car look as good as possible and seem nearly new. Even if the car isn’t a CPO, the dealer will usually do some touch-ups before reselling, such as repairing door dings and providing a fresh coat of paint.

A car from a private seller, on the other hand, will probably come with some noticeable wear-and-tear. However, it will likely be less expensive — and if you point out the flaws when you negotiate, you may be able to save even more. To freshen it up, you can take the car to a shop for maintenance or a coat of paint, and it should cost a lot less than the markup you’d pay to buy it from a dealer. Websites including and AutoMD can help you estimate the cost of the touch-ups.

The Car’s Past

A used car had a “life” before you, and it’s important to understand what the car has been through. It’s up to you to gather information and do your research — especially if you’re considering a private seller.

Start by asking the owner some general questions about the usage and mileage. You may learn something about the vehicle’s history that will come in handy down the road just by chatting.

If everything sounds good, it’s time to do some fact-checking. Ask the owner for the vehicle identification number (VIN) or look for it on the driver's side dashboard plaque near the windshield. Once you have the VIN, enter it in the free VINCheck database on the National Insurance Crime Bureau (NICB) website to make sure the car wasn’t stolen or reported as salvage. You’ll also want to purchase a car history report to get a record of accident damage, recalls and any title problems. Find more information on what to look for and how to interpret car history reports.

It’s also important to make sure that the car has had regular maintenance performed, and that any necessary repairs have been completed. You'll also want to check that the car was brought in for the recommended services — every 5,000 miles for most cars. A car that has not had timely maintenance could be a risk for problems later on, even if it passes state inspection. If you’re buying a car from a private seller, you can ask the owner for copies of the maintenance records.

A reputable dealer should provide some information about the car’s history for you. For instance, if you buy your car from a dealer of the same automaker, the dealer can usually provide a list of all the services that were performed on your vehicle at any franchise in the U.S. A car from a dealership may also be CPO, which usually guarantees that the car has had regular maintenance performed, and that it has never been in a serious accident or had a major repair.

The Manufacturer’s Guarantee

A warranty can provide the peace of mind that your car will keep running for at least a certain amount of time. But you don’t necessarily have to buy your car from a dealer to be protected under one.

The warranties provided by the manufacturer when a car is new are transferable to a later owner regardless of whether the car is sold by an individual or a dealer. Depending on how new the car is that you are purchasing, you may still have some of the new car warranty remaining.

However, if a warranty is important to you, CPO may be the way to go. CPO cars always come with an additional warranty, although the specifics vary between automakers. The warranty is the primary reason CPO cars cost more than non-CPO cars, so if having a warranty is important to you, it may be worth the additional cost.

The Price Tag

The price tag is often the biggest benefit of buying a car from a private seller. Buying from a private seller eliminates the middleman, and the cost savings can be substantial.

Ultimately, the decision comes down to what's important to you and how much you're willing to spend. For a little extra money, you can get a car that has been reconditioned and is guaranteed under a limited warranty. But if you've got your eye on a car from a private seller, and you've done your research, it might be worth it! As long as you take your time and make sure the car checks all the key boxes, buying from a private seller can be a great way to get the car you want at the lowest price.

Whichever option you choose, your American Family agent will be there to support you and help you find the right insurance to protect your vehicle.

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Related Topics: Car Buying