Dear Chuck, 

Should I buy a car from Craigslist? There seems to be a lot of great deals from private sellers. And I would love to pay cash rather than have a car payment. But the process seems so daunting. Many of the posts look like scams, and most sellers say “cash only” but I don’t want to carry that much cash. Is it worth the trouble? 

Sincerely, 

Craigslist Newbie 

Dear Newbie,

Thanks for the great question. It’s one that I answer in the affirmative (it is worth the trouble) as I personally just used Craigslist to help my 18-year old son buy a used car. And yes, we paid cash to do it.

While it’s important to take safety precautions when making a purchase through this kind of network (as Craigslist itself advises), I have found it a useful tool for finding a quality vehicle for a lower price. I recommend a cash deal, if possible, when it comes to a used car. Although a little lengthy, I have provided some important tips and lessons we learned.

First, be very cautious of scams, thieves, and sellers with fraudulent intent especially as you are getting started. Certainly keep personal information to a minimum when communicating through e-mail or text. You may even want to set up a separate e-mail account for conversations like this.

Try to ask questions to determine if the person is really who they say they are and have some knowledge of the car they are selling. I often ask for information not listed in the advertisement like: “Where do you get the car repaired? Do you have a CarFax report that I can see? What has been the biggest repair you have had done on the car and who did that for you? Can you send me a few pictures of the engine and tires?” This gives you some idea if the person you are talking to keeps the car maintained and who they deal with locally.

When I decide I actually want to see the car, I take further security measures. I strongly recommend arranging a meeting in the parking lot of a local fast food chain or large retail store in the middle of the day – never at someone’s house. Some police stations have even set up safe meeting locations next to their stations. I let others know when and where I am meeting the seller to add additional protection.

Second, as with all sales experiences, it matters who you are dealing with, and I have found it best to buy from an individual or reputable dealer, being on the lookout for less than honest dealers pretending to be an “owner” when they are actually just getting rid of a lemon on their lot.

Here are a few guidelines I developed before we would set an appointment to look at a car.

• Hopefully find a car before it was traded in to the dealer to snag a better price from the owner.
• I preferred to look at vehicles for sale-by-owner (rather than a dealer) with a clean CarFax report. That means no “rebuilt titles” (showing that the car was once totaled and has since been repaired).
• No cars from known flood zones (we actually looked at a car that had been flooded, and when we asked for the CarFax it reported it. Water and engines and electrical systems don’t get along, so we passed on that one).
• We also ruled out cars that were purchased from an auction. (It’s very difficult to say how a car came to be sold at an auction. This rule eliminated lots of “dealers” who flip cars as a side business).

Several people we talked with were trying to rip us off, and it can take time to get to the real facts about a car. My preference: buy a used car from the first or second owner that has not been through a major incident such as a wreck, flood, or auction.

Third, ask the seller for maintenance records, history of use (how often did the owner drive it and how far), where the car was serviced, when the tires were last replaced, etc. Save yourself some time by asking for this information through e-mail.

And fourth, do your homework on the value of the car you are considering. Before we went to test drive and inspect the car we did our research on the value using the Kelley Blue Book, nationally known for information on the value of cars, and the National Auto Dealers Association, where we received free, online services helping us evaluate if the price the owner was asking was fair.

For me, I was able to use this experience as a teaching opportunity for my sons, as I took them through this process. When we finally narrowed our search, and were ready to see some cars in person, I took both of my teenage sons, asking them to evaluate the condition of the car on a scale of 1 to 10, looking at tires, engine, interior, rust, windows, seats, power systems, spare tire, paint, etc., and I asked for their evaluation of the value of the car versus the price being asked.

Eventually, we found a car that the three of us rated an 8 out of 10 for quality of condition but the owner wanted a 10 out of 10 in price, top dollar, asking $7,500. It was worth considering, so we asked to have the car inspected by a mechanic (which cost us $100) and found that the car needed $2,500 in engine work! That was well worth the $100 inspection fee as the repairs needed were not obvious to our untrained eyes. That would mean the price had to come down 30+ percent for us to be interested.

We made an offer by text, which the seller initially refused, but three days later they contacted us again and to our surprise, took the reduced price. The repairs were made after the sale, and my son couldn’t be happier. We paid cash for the car and necessary repairs. When we made the actual purchase, I wrote a bill of sale, a title transfer and a mileage affidavit to ensure there would be no issues once we handed over the cash.

We kissed lots of frogs and only one turned into a prince. We emailed or texted about 25 sellers, test drove four cars, and made one offer.

To be frank, this was a time-intensive process and discouraging at times, especially when we felt deceived by some of the sellers. This process is not for everyone. An alternative is to buy “Certified Used” from a reputable car dealer. You will pay a premium, but the car will come with some guarantees and you won’t have to worry about finding out later the transmission is ready to fall through the floor of the car. But I’ve found that it is difficult to find anything under $10,000 that I think is a bargain from a dealer. Crown has some additional free advice on how to evaluate a car purchase you can read here.

Hopefully, you will enjoy the process. People have been enjoying the art of buying and selling since the beginning of time. Proverbs 20:14 observes, “’It’s no good, it’s no good!’ says the buyer– then goes off and boasts about the purchase.”

I hope when you finish shopping on Craigslist you will be as happy as we are with the car you find.