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Where to shop for a used car

You can buy a used vehicle from a much wider range of outlets than a new vehicle. Prices can vary greatly, but so can the quality of the car. Following are the typical outlets for buying a used car. To find them, check the classified ads in local newspapers and specialty auto-selling publications, as well as those on Web sites specializing in used-car sales.

New-car dealers. Nearly all franchised dealers have a used-car department that sells vehicles they have taken as trade-ins, bought at auction or from another dealer, or that have come back at the end of a lease. These departments tend to feature late-model vehicles, two or three years old, that often carry the remains of the original factory warranty. Many new-car dealers don't bother with cars more than four or five years old, or ones that are difficult to sell, so their used vehicles tend to be expensive.

Auto superstores. Superstores are dealerships with huge lots and scores of cars to sell. CarMax, for instance, is a superstore chain that sells cars at no-haggle prices. There are also independent dealerships that call themselves superstores. Whether they specialize in low-pressure, one-price selling or want you to bargain the old-fashioned way, their advantage is the quantity and variety of the stock.

Independent used-car dealers. These dealerships are apt to handle any car make, and the vehicles can run the gamut from the almost-new to the junker-in-waiting. Some dealers specialize in late-model cars, and can be affiliated with a franchised new-car dealer. If the dealership has been around for a long time and has a good reputation locally, that's a good sign. As with new cars, many used-car dealerships can arrange financing for you. Still, caution is the watchword. Both price and quality tend to be lower than at a new-car dealership.

Service stations. Many service stations have a sideline business selling used cars. They may not have all that many cars to sell, but prices are often better than those you'll find at a dealership. If the station has serviced the car throughout its life, you may have access to the repair history--a real plus. But take it somewhere else to have an impartial inspection performed.

Private owners. You can usually get the best price if you buy a car directly from its previous owner. A private party doesn't have to cover the overhead of a business and frequently just wants to get rid of the vehicle. A private owner, however, may not be aware of trouble signs that a dealership or service station would recognize. Conversely, many rebuilt wrecks are sold through private sellers. Again, having a thorough, independent mechanical inspection performed is critical.

Shopping online. Buying—or at least researching—used cars online opens up a world of possibilities. Its major advantage is your ability to search, sort, and check the marketplace without leaving home. Used cars aren't necessarily cheaper online, but the Web does provide an easy way to find out the price for which various models are selling in your area. You may find, however, that many offerings are located inconveniently far from home.

Used-car Web sites typically ask you to fill in some search parameters: the make and model in which you're interested, your price range, and the region (usually based on your ZIP code) where you'd like to shop. Try to limit your search to the area within which you're willing to travel to inspect a vehicle. You then get a list of vehicles that fit your buying criteria, along with the sellers' e-mail addresses or phone numbers. Because many sellers are car dealerships, most sites provide direct links to the dealerships' Web sites. Many services also let you place a classified ad for selling your old car, either free or for a small fee.

Online auctions (eBay Motors is by far the largest) are another route. The auction system is a little different from standard dickering over price. On eBay, once you enter a bid, it's like signing a contract to buy, whether there's a reserve or not. The buyer is obligated by the bid, and the seller is obligated to accept it. If there is a reserve, this price must be met before the auction can close. But if no one comes close to the reserve, the seller can remove it. While that means you can snap up a bargain, it also means that you can't get out of the deal unless the seller has made some serious misrepresentation. There is, however, a conditional guarantee by the seller and a short-term service agreement of one month or 1,000 miles. You can arrange to have the vehicle inspected through a paid service on the site.

Problems we've noticed with used-car Web sites include outdated information and the clutter of pop-up and banner ads from other service providers. Sellers must constantly update their Web offerings as inventories change. If they don't, the sites grow stale and inaccurate. That can make locating even common models a challenge. Always call before visiting any seller, whether it's a dealership or a private party, to make sure the vehicle you're looking for is still available.

No matter how much of the transaction you conduct by phone or e-mail, it's important to inspect the vehicle in person and take it for a test drive before you buy.