Every year, 13 to 15 million used cars in the U.S.—one of every three sold—has a private seller, says Chris Basso, spokesman for Virginia-based CARFAX. For used car buyers who invest patience and time, the lack of overhead the seller must pay might lead to a better deal for you.
One in three used car sellers in the U.S. is a private party.
Below are some things Las Vegas residents should think about when they’re preparing to buy a car from a private seller.
Trade-Off: Price vs. Uncertainty
Private sellers can offer more price flexibility than dealerships do, says Basso, because the seller is often an individual who is eager to sell. By contrast, a dealership often can afford to wait for a buyer who is willing to pay a set price. However, private sellers bring more uncertainty, such as the potential lack of a stable mailing address and phone number.
For that reason, CARFAX recommends purchasing from a dealer, because the buyer has more recourse with a dealer, he says. According to the Nevada Department of Motor Vehicles website, state law requires car dealers to get a business license from the DMV, and the DMV typically investigates complaints against dealerships only, not against private sellers. On rare occasions, the DMV will investigate complaints against private sellers, in the case of document fraud or odometer fraud.
Merely buying a used car in Vegas brings a higher-than-average risk for odometer fraud. Nevada has the second-highest incidence (after California) of this type of fraud, says Basso. And, the implications of such fraud can be significant for the buyer.
“Every year, more than half of the 200,000 cars affected have odometers rolled back by at least 50,000 miles,” he says. “Average loss to the buyer is about $4,000—that’s lost value (paying more than a vehicle is worth), and also maintenance costs occurring sooner than expected.”
Where to Look
Car dealerships aren’t hard to find, but where can you find a private seller? Think about these factors as you’re beginning your search:
• Have an idea of what you’re looking for in a used vehicle—color, make, mileage, price, etc.—before you start looking.
• Word of mouth: You can reduce uncertainty if you buy a vehicle from someone you already know—a co-worker, friend, neighbor, or relative.
• Look around your daily environment. Notice “For Sale” signs in car windows. (In Vegas, some private sellers use white shoe polish to write dollar signs on the windows of a car for sale.)