Beginner’s Guide to Car-Buying

By Matt Currie

Did you just get your licence? Are you the parent of a new driver? Read on for our tips on how to land the right vehicle for the right price.

Sleek design and a wicked sound system are nice perks, but first figure out what you need—cargo space, all-wheel drive, power versus fuel efficiency and so on. Do this before you start shopping, set a budget and stick to it. Be sure to include all costs in your budget, including fuel, insurance, maintenance and repairs.

From consumer reports to IIHS crash-test rankings and CAA’s Driving Cost calculator, all the info you need to find your ideal car and negotiate a good price is a mouse-click away.

If you’re buying used, this is the best investment you can make. Before you buy, take the vehicle to an AMA Approved Auto Repair Service location for a 201-point inspection—even if the seller has done his or her own inspection. If the inspection identifies required repairs, consider asking the seller to deduct the cost from the sale price, or split the difference.

On new cars, dealers normally mark up factory options between 15 and 20 percent, while dealer-installed options can be marked up even more. A reasonable offer would allow the dealer approximately half of the mark-up as profit. Keep an eye on extras, such as paint sealant or so-called “processing fees.” Private used-car sellers tend to set asking prices high to leave room for negotiation. If you’re buying privately, check out the asking prices of other similar vehicles, as well as the Black Book and Gold Book values. Make a first offer that’s 10 to 20 percent lower than you’re ultimately willing to pay, so that you have room to negotiate.

Particularly for used vehicles: look for rust and signs of excess wear—plus any signs that undisclosed repairs have been made (mismatched paint, slamming doors, gaps in metal seams). Request the maintenance records and look for evidence of past collisions or damage.

Alberta Vehicle Information, Carfax and CarProof reports will turn up liens, past insurance claims and accident history.

Get a feel for how the car performs in as many different driving scenarios as possible—from parallel parking to highway motoring. The drive should last between 30 and 45 minutes and emulate the type of driving you plan to do. Feel for any pulling to one side, which might indicate misaligned wheels—and look for warning lights on the dashboard. Afterward, examine the exterior for signs of leaking and listen for strange sounds while the engine is still running.

If you’re buying from a dealer, make certain that everything you negotiated with the salesperson is in writing—and double-check any extra costs, such as taxes and freight charges. Don’t leave sections blank, and ensure that any changes are reflected on all copies of the agreement. Remember, a signed sales offer is a legal commitment to buy—so don’t put pen to paper unless you’re ready to drive those wheels off the lot.

If you think the seller is employing high-pressure or underhanded tactics—excessive stalling, outlandish promises, refusing to allow a test drive or inspection—take the high road out of there. You’ll find the right set of wheels somewhere else.

Click here for even more car-buying tips from AMA.

USEFUL RESOURCES FOR CAR SHOPPERS A comprehensive resource for buying, registering, driving and maintaining a vehicle. A fount of information on new- and used-vehicle reliability, as well as pricing. Here’s where you can find out what the dealer paid for a vehicle, and how much of that sticker price is markup. AMA members can pull up to five free Dealer Cost Reports per month. A Canadian vehicle data source that features reviews, reliability ratings, test drives, news, pricing and specifications.

Consumer Guide Road Tests: The place to gather full details of a vehicle model’s safety, reliability, pricing and more, and compare it against other vehicles in the same class.

CAA Driving Costs Calculator: A tool to compare fuel costs and greenhouse gas emissions of various vehicle models.

IIHS crash-test ratings: The U.S.-based Insurance Institute for Highway Safety maintains detailed crash-test information on a wide variety of vehicle models.

Consumer Reports: Use this magazine’s online car-buying calculators and worksheets to figure out what your lease or finance payments might be, then download the test-drive checklist to put a vehicle through its paces before you buy.

Transport Canada: Visit this government website to ensure your would-be vehicle hasn’t been flagged in any product recalls.

AMA Black Book and Gold Book: These member-only services will give you a sense of the price you should be paying for used cars of all makes and models.

Vehicle information reports: Alberta Vehicle Information, Carfax and CarProof reports will give you the low-down on any set of wheels, detailing things like past insurance claims, accident history and actual mile- age (in case the odometer’s been rolled back); just jot down the VIN number (you’ll find it in your vehicle registration papers).