We recently had a customer come to us looking to replace their 15-year-old car that had been badly damaged in a car accident. He was looking for a relatively inexpensive used car, as it was not the primary commuter car for their family.
When we told them we didn’t have any inexpensive cars in inventory, but we could help them find a good one for a small fee, he politely declined and said, “we just need to get a cheap used car for our kids to drive and are pretty specific about what we’re looking for.” He also said he would consider hiring us if they wanted to purchase a nicer, newer car.
While we look forward to working with this customer in the future, auto brokerage is not just for newer cars, and it can be of greater help to customers purchasing an older car.
Here’s why:
It is much easier to find a newer car in good condition.
If you are looking for a late-model car, prepare for some serious legwork.
So while the risk seems higher on a more expensive purchase, the odds that a 3-year-old car with 50k miles will need a new engine or other expensive and unexpected repairs are much lower than a 15-year-old car with 150k miles. The average 3-year-old car is in better condition than the average 15-year-old car.
When we first started offering brokerage services, we only focused on used cars up to about five years old. It is not hard to find good, lightly used cars that don’t need much reconditioning beyond a set of tires, maybe new brakes and a couple of dents and scrapes repaired. If you’re already set on a certain make, model, color, or trim level, you just have to be patient, and a car that fits your specifications will come along. Car buyers still needed help with the purchase process, but the risk that the car would arrive with serious or expensive surprises was far lower.
On the other hand, if someone asked us to find them a 15-year-old, $5,000 car that required much more leg work. At that age and price point, most of the cars at the dealer auctions were cars that needed significant work, had major body damage, or had high miles and lots of wear and tear. We probably looked at 20 of these for everyone we bought. And even then, they usually required a few weeks and thousands of dollars in reconditioning. So this wasn’t a quick process, and it didn’t make sense for us to try to find these cars for customers. But when we did find something in that price range we would recondition them and put them in our inventory
The Smaller Your Budget, The Greater the Challenge
The average customer that’s looking for an inexpensive car is typically looking for something that’s primarily reliable. When your budget is limited, you don’t have a cushion for unexpected repairs.
Most people have an idea of what they want, but it might be difficult to find a good example in their price range. And when good cars do pop up, they tend to sell quickly, either to buyers who have been looking and know what they want or to curbstoners who will clean them up and flip them at a higher price for a quick profit.
This means you have to look past minor dents, scrapes, and higher mileage to find a car that’s been well-maintained. Ideally, you want to find a car that someone is selling because their needs have changed, not because they just got a $4500 estimate to replace the head gaskets.
If you need a car quickly, you might need to look at models that you normally wouldn’t consider but are still reliable and good value. Like an older Buick instead of a Toyota Prius.
How do you spot these cars? That’s where experience comes in. Knowing which older cars can be a good value. Knowing what questions to ask the seller before you start driving across town. And knowing how to read a Carfax. Sometimes what they don’t say is just as important as what they do say.
Customers with a smaller budget are less likely to spend money for an inspection or advice
One of the first things we learned when we started our dealership is that probably only 10-20% of buyers are willing to spend $100 for a Pre Purchase Inspection once they found a car they like. Especially when the budget is tight. But this is when it’s even more important. A 15-year-old car might be a few months away from needing a new transmission or engine. And the signs that a transmission is starting to fail can be subtle and easy to miss. Even knowing that the brakes are almost worn out or the tires are ten years old can mean the difference between finding something in your budget or buying something that quickly needs $1000 in repairs that you can’t afford.
We believe that the money you spend hiring a good auto broker will be made up in the reduced risk of buying a car with hidden problems, as well as the time savings we can provide. We are also comfortable negotiating with sellers when many people aren’t.
Want to learn more? You can read more about auto brokerage services or contact Esprit by email.
