What Do I Need When Buying a Used Car?

When it's time to buy a new car, purchasing used may save you a ton of money. However, it is important to be an even more savvy consumer when you purchase a used car, because you can't be sure of any pre-existing issues that car may have had with the previous owner. While the purchasing process is generally the same, there are a few things to you need to bring -- and request -- when you buy a used car.

You Provide: Basic Information

When you buy a used car -- or a car of any kind, actually -- you need to provide basic information, such as your state-issued photo ID and Social Security number for the paperwork. You need to provide a method of payment, be it in the form of cash, cashier's check, personal check, money order or credit card. If you obtain financing, you may also need to provide financial statements, a recent pay stub, proof of residency (in addition to your driver's license) and proof of insurance on the vehicle, which needs to be lined up simultaneously while purchasing the car. Generally, you can obtain a quote and start the policy over the phone and then drive to the insurance company directly from the dealership if you don't have insurance, or simply transfer existing coverage via the phone or Internet if you do already have a policy.

Seller Provides: Car Maintenance History

This is different from a general vehicle history. This gives a very specific accounting of the maintenance and repair work done on the car, from the last oil change and tire rotation to any major repair jobs. According to the Federal Trade Commission (FTC), if the owner of the car or the dealership does not have this information, request it from the shop where the work was done. Chances are, it has more extensive records and may be willing to share them with you before you purchase the vehicle.

You also need a vehicle history report. This tells you about any accidents the car has been in or whether or not it has been exposed to a natural disaster, such as a flood. You can use a commercial company, such as Carfax, or go through a government agency, like the National Motor Vehicle Title Information System or the National Insurance Crime Bureau (see Resources).

Seller Provides: Buyer's Guide

The FTC requires that dealerships offering used cars for sale must post an accompanying buyer's guide. This guide gives consumers insight into the vehicle they are purchasing. Information in it includes whether or not there is a warranty on the vehicle, what costs the dealer will pay for repair as per the warranty, a warning about spoken promises, major car systems including any potential problems of which you should be aware, a warning to get promises in writing, a warning to keep the buyer's guide and a reminder to have the car checked by a reputable auto professional before purchase.

You Request: A Written Return Policy

It is important to understand your rights when purchasing a used car, particularly regarding your right to return a vehicle. According to the FTC, the right to cancel a purchase and receive a refund only exists if the dealer grants you the policy. If this is the case with your used car dealer, ask for it in writing so you have proof of the policy and can take advantage of it as it relates to your purchase.