Buying a Car from a Private Seller

Fortunately, I happen to live very close to my work resulting in a daily bike commute that takes roughly 10 minutes. Hence purchasing a car was never really that high up on the priorities list. And Uber being as prolific as it is around Silicon Valley meant that I could always catch a ride in a pinch if I happened to need it. But with my wife’s arrive and new job, combined with an increasing desire to adventure and hike on the weekends, we soon realized that we needed to purchase a car.

Craigslist in the US is like Gumtree for Australia and can be used to find used cars without having to go through a dealership. Our first time buying experience wasn’t particularly great and there are a couple of things we wish we knew before we handed over our money. If you are buying a car from a private seller, ensure that:

  • The car comes with a recent smog certificate.
  • Car title papers match the seller’s driver’s license details.
  • You have a car fax of the car

If either of the above are unavailable, you need to walk away. A smog certificate is like a pink slip back in Australia. It is a document that is valid for 2 years, and then needs to be renewed. It is not applicable for cars under 4 years of model age. The test for this certificate checks to ensure that your car is not a “gross polluter”. You will also need to provide the smog certificate to the DMV when you go to change the title of the car over to you. You will not be able to change the title of the car into your name, and hence you will never really own your car, if you cannot pass or have a certificate already for, a smog test. You may also be responsible for all the costs associated with getting the parts replaced to pass the check. California has some pretty good consumer protection laws so long as you can prove that a transaction occurred. Most private car sales are cash deals that are completely unprovable with no receipts. All this legal stuff costs money too, my advice? Get the seller to do the work, otherwise walk away. Curiously, unlike a pink slip in Australia, nothing else apart from engine stuff is checked. Seatbelt check? Brakes check? Lights check? Not tested with a smog. Be free says California!

Ensuring that the car’s title papers match the seller’s name is also critical. If this is not the case, then this is not a car that the seller can sell! It could be stolen! Verify their details according to their driver’s license, if they refuse then walk away.

A car fax is also critical. A car fax is a report that lets you know where and what the car has been doing its entire life. If a car has been reported as stolen, it will appear on the car fax. If you are looking a lots of private car sales, you can sign up for $60 to run as many reports as you like. It’s well worth the money. Trick: You can run the VIN number of a car as well its license plate number to obtain a car fax as some sellers will cover the license plate (for privacy I guess).
Trick: If a car has originally come from the East Coast and somewhere where they salt the roads, make sure when you inspect underneath the car for rust. Salt changes the freezing point of water to help stop black ice forming on roads. It also does a great job turning cars into rust buckets! Trick: Bring along a friend that knows about cars and can be a witness if anything weird goes on.

That pretty much sums it up. As an alternative to a private sale, go and take look at some dealership offers too. Cars are cheap in the US, and having a car loan against your name, and proving that you can pay it off, is actually a good thing from a credit lending perspective. If you are wanting to one-day purchase something bigger like a house, you will need to be able to prove that you can be trusted and having a settled car loan is a great start. Dealerships will also provide you will a solid, reliable point of contact if you have any questions. They also tend to send out lots of specials for car maintenance which you will need to do regardless of buying through a dealership or not.

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