Best Used Car Buying Guide 2024

How to buy a used car in Ontario

Are you thinking about buying a used car in Ontario? They are a great option. However, many people shy away because they are not educated about the steps to buying a used car. They are worried they’ll buy a lemon or get suckered into a bad deal – even with rising costs.

The used car market remains hot but unpredictable. Over the last few years, many automotive industries have been hit with shortages and inflated prices. Interest rates, supply chain issues, and chip shortages are still happening today.

According to a National Post article from February 2024, the average cost of a new car was $66,979, nearly 33% higher than the price mentioned in a February 2019 article, which was $45,255. Used vehicles have also become more expensive, with an average price of $38,451; in February 2019, it was $26,331.

Choosing the best used car to buy may have more challenges, but they are still a top option for drivers in the province. Getting some advice for buying a used car is a great first step. To help you out, we’ve put together this used car buying guide filled with advice and considerations.

Three main takeaways about buying a used car in Ontario:

• When shopping for a used car, you’ll want to consider how many kilometres are on the vehicle, set your budget and vehicle history and find a reliable seller.
• Ensure you compare your Ontario auto insurance options before purchasing a used vehicle; some sellers will need the proof before closing the sale.
• You have two options for paying for a used vehicle: you can pay in full or finance your choice of vehicle.

13 best tips for buying a used car in Ontario

Buying a used car is a process, but you can feel good about your decision by taking certain steps. Here are essential tips to follow when buying a used car in the province:

1. Establish a budget
2. Determine the type of vehicle you want to buy
3. Narrow your selection to a specific make and model
4. Check reviews about the vehicle. Is it one of the safest cars in Canada or known for its fuel efficiency?
5. Identify potential sources of used cars
6. Compare pricing options against industry averages
7. Check the vehicle history report
8. Contact the vehicle seller
9. Take the car for a test drive
10. Get the vehicle inspected by a licensed mechanic
11. Negotiate a fair price
12. Compare car insurance quotes to ensure you have proper coverage
13. Close the deal and transfer the vehicle ownership

Insurance considerations when buying a used car in Ontario

An often overlooked consideration when shopping for a used car is car insurance. Once you have an idea of the vehicle you want to purchase, it’s good to speak with an advisor to find proper coverage. You can purchase gap insurance from car dealerships and financing companies to ensure you are protected between vehicles.

Then you will know how much it will cost to insure the vehicle, especially if it’s a very different vehicle from the make or model you usually drive. Often, used cars have lower premiums.

Knowing how much it costs to insure a vehicle when exploring your options allows you to get a better sense of the total cost of driving per month, which can factor into your approach to negotiating.

10 questions to ask when buying a used car

Gathering as much information as possible is the key to making a solid used car purchase. One of the best ways to do this is to ask the seller many questions! Not sure what questions to ask? Here are some good questions to start with:

1. Reason for selling: Why are you selling the car?
2. Accidents: Has the vehicle been in an accident?
3. Repairs or modifications: Has anything been repaired, replaced or modified on the car?
4. Owners: How many owners has the vehicle had?
5. Gas mileage: How fuel-efficient is the car?
6. Maintenance: Did the car have regular oil changes and a maintenance schedule?
7. Warranty: Is the vehicle still under the manufacturer’s warranty? If an issue exists, can it be fixed before the purchase?
8. Cash discounts: Will they consider a cash discount?
9. Certified pre-owned: If the car is certified pre-owned – ask to see a copy of the inspection report.
10. Trade-in: If you are buying from a dealer – are they willing to take a car as a trade-in? You can find out your trade-in value before going, this can help with negotiating.

Ask as many questions as you have. If the buyer gets annoyed, agitated, or tries to close the deal quickly, it could be a sign they are hiding something. Remember, you can always walk away.

How to negotiate a used car

If you’ve found a car you want to purchase, it’s time to negotiate. Rule number one is to always negotiate. The asking price is very seldom the firm final price for the person selling a car. It’s called an asking price for a reason. Here are some tips for negotiating:

• Know the current market value of the vehicle: Use Kelly Blue Book, Auto Trader, and Canadian Black Book to get a good idea of how much you should pay.
• Consider value for the price: Other factors, such as the inclusion of winter tires, low mileage, and wear and tear, may factor into the price.
• Know your budget: Know your budget and stick to it. But this doesn’t mean you have to tell the seller what your top dollar is during the negotiation.
• Eliminate emotion: Negotiate based on logic and have confidence in your offer.
• Don’t be afraid to counter-offer: Negotiations are about going back and forth, so don’t be afraid to counter any offer made by the seller.
• Avoid making a rash decision: Always give yourself enough time to weigh your options and make a decision.
• Be prepared to walk away: You have other options, and if the deal is not what you want, walk away. Never agree to a deal that makes you uncomfortable.

Tips for buying a used car online

As with any other purchase you make online, you need to be careful about who you do business with. Watch out for unlicensed dealers, online scams, and sellers looking to take advantage of you. Here are some quick tips :

• Seller: Always verify a seller’s credibility.
• Verify VIN: Verify the VIN number of the vehicle and have it inspected.
• Checkout car: Never buy a car sight unseen – always check it out in person.
• Car information: Get as much information as possible about the vehicle
• Don't pay in advance: Never pay before you get the vehicle.
• Compare: Compare car pricing and options using multiple websites.
• Too good to be true: If the deal seems too good to be true, then it probably is.

Remember, if something doesn’t seem right, then it’s probably not. The beauty of buying used is that even if you back away from a deal, there will always be another one.

Buying a used car in Ontario from a dealer

A dealership is one of the many sources where you can purchase a used car. If the online route is not for you, buying a used car from a dealership is a common option. Dealerships can offer various vehicle options, but they are often limited in terms of make and model. One thing they can offer is assistance with financing.

Many dealers also offer warranty packages for used cars. But, like with any other type of business, it’s important to do your homework and check out ratings and reviews of the dealership you are considering.

Like anything else, there are good dealerships and poor dealerships. Be diligent and shop around to find the right one for you.

How to buy a used car privately in Ontario

Purchasing a used vehicle from a private owner is slightly different. If you are interested in purchasing the car, ask to see the seller's used vehicle information package. Make sure you carefully review the vehicle history.

Test drive the vehicle and have it inspected by a mechanic. If you purchase the car, make sure you take the package. Get the vehicle permit and bill of sale. You will need the plate portion of the vehicle permit to complete the transfer of car ownership.

Benefits of buying a used car

We’ve all heard the saying before – the minute a new car is driven off the lot, it will depreciate - a new $30,000 vehicle depreciates just over $2,500 in the first minute. Better make that first minute of driving worth it!

Many people still have a distorted view of the used car buying process. They envision buying a beater that always breaks down and is riddled with mechanical issues. This is not the case today (in most instances).

Here are the benefits of buying a used car in 2024:

• Cost effectiveness: The purchase price is one of the main factors for people buying used. Many of us simply can’t afford to or don’t want to spend $30,000 on a vehicle. The average price of a used car in Canada is half of this, at about $13,000.
• More options: You can buy vehicles from multiple dealers, different makes and models, and different years.
• High quality used vehicles: There is no shortage of high quality, low kilometre cars to choose from, many of which are just returned after a lease.
• You can get exactly what you want: When you shop for used, you can get exactly what you want. Whether you want a ’09 Honda Civic, ’05 Ford F-150, or ’12 Nissan Pathfinder, you can find one.
• You can find a car within your budget: You can also shop based on budget. Whether you want to spend $5000, $15,000 or any number in between, you can find many great vehicles that will fit within your budget.
• Better investment: Used cars don’t depreciate in value as quickly as new. You will retain more value, and you will be able to recoup more of your money if you decide to sell.

Disadvantages of buying a used car

Like any purchase, there are pros and cons. These are some potential drawbacks of purchasing a used car :

• Reliability: Used cars can be less reliable than new vehicles.
• Less current features: They may have fewer current vehicle feature options because of the older model year.
• You get a lemon: There is the potential you could get a lemon.
• Higher loan interest rates: Typically, higher interest rates are when you finance a used vehicle.
• Warranty: There is no warranty if purchasing from a private seller.

Buying a used car is a respectable alternative to buying a car in Ontario

Get as much information about the vehicle as possible before buying used. Get a vehicle history report, get the car inspected by a licensed mechanic, ask the seller many questions, test drive the vehicle, and make sure you follow all transfer of ownership rules.