Online Tools to Find a Fair Price for a Used Car or Truck
Used car dealers don’t have the best reputation for fair dealing, and you certainly don’t want to get ripped off when you buy a used car or truck. How do you know if the dealer’s prices are fair or sky high? And how do you know if you are getting a good price on your trade in?
Hasbrook & Hasbrook is one of Oklahoma’s top auto dealer fraud law firms. Of course, unless false representation is involved, there is no law against a used car dealer charging way more than a vehicle is worth. But we don’t want to see our clients and fellow Oklahomans get ripped off. In keeping with our goal to help you avoid being scammed when you buy a vehicle, here is some information about how to get a fair price on a used car or on your trade-in.
This is one of a series of four blog posts. In an earlier post, I surveyed five online tools to help determine the best price when buying a new vehicle:
In this post, we will review some good online tools when shopping for a used car or truck. The other two posts of this series (with links to them at the bottom of the first post above) are:
- “Online Tools to Compare Actual Car Prices in Oklahoma City”
- “Ten Smart Rules When Shopping for a New or Used Vehicle”
First, though, let’s define one term. On the car lots as well as on the websites below, you will see the term “certified” or “certified pre-owned car.” A CPO car is one that has been inspected, has sometimes been refurbished and is still under warranty. Details of CPO programs vary among manufacturers, and some dealers offer their own CPO program. Certified cars cost a little more than uncertified used cars, because the inspection and warranty add value.
FIVE ONLINE PRICING TOOLS FOR USED CARS
In comparing the following online tools, we checked for prices for a 2012 Toyota Camry Sedan LE, four-door, four-cylinder, no special options, with 50,000 miles, in “good” or “clean” condition.
1. Kelley Blue Book: www.kbb.com
When it comes to used car values, Kelley Blue Book, which has been around since 1926, is the industry standard. In 2010, Kelley became a subsidiary of AutoTrader.com, but it still operates under the familiar Kelley brand. Here are the prices Kelley listed for that 2012 Toyota:
From a dealer:
- CPO (based on actual transactions in the area market): $16,376
- Suggested retail price (dealer’s expected asking price for a non-CPO): $15,876
- Fair purchase price (based on actual transactions in the area market): $15,326
- Buy from or sell to a private party: $13,393
- Trade-in value: $11,784
2. NADA Guides: www.nadaguides.com
The National Auto Dealers Association’s NADA Guides is one of Kelley’s main competitors. Here are NADA Guides’ prices for the 2012 Toyota:
From a dealer:
- Certified: $17,550.
- Retail: $16,525
Trade-in value: $13,750
Some experts say NADA prices favor the dealer. In our previous blog post, we found little difference between NADA and Kelley on the price of a new car. However, when it comes to used vehicles, NADA’s prices are significantly higher: almost $1200 higher on a certified used car and about $650 higher on a used car’s non-CPO retail value.
On used car prices, those experts appear to be right. NADA is higher. Remember, NADA is the dealers association, and these prices are what you are going to pay to those dealers.
3. Edmunds.com: www.edmunds.com
Edmunds was founded in 1966 and has been on the Internet for more than 20 years. When you go to the Edmunds home page and plug in specifics on the car you are interested in, it asks: “How Can We Help You?” Choose “appraise” to evaluate a dealer’s price on a specific car. Edmunds says its prices (which it calls “True Market Value”) are based on the average of recent actual sales in your region.
In my previous blog post, when we compared Kelley, NADA and Edmunds for their prices on new cars, Edmunds was significantly higher — even though our research indicated that Edmunds has a reputation for listing lower prices than the other two. Edmunds lives up to its low-price reputation on the prices it lists for the 2012 Toyota:
From a dealer:
- Certified: $15,991
- Retail: $14,750.
- From a private party: $13,567
- Trade-in: $12,237
4. CarGurus: www.cargurus.com
CarGurus was founded in 2006 by Langley Steinert, a founder of TripAdvisor, the popular travel website. CarGurus has expanded to Canada and expects to enter England and Germany this year. Forbes magazine listed CarGurus as one of the 100 “most promising companies” in America.
CarGurus’ primary focus is on actual used cars for sale right now in your area. (We will discuss that feature in the next post of this series). However, CarGurus does offer some guidance about the value of a specific car you are considering.
In the navigation bar at the top of the Home page, the first button is “Used Cars,” but that takes you to listings of actual used cars for sale. Instead, scoot two buttons over to “Car Values.” That will lead you to CarGurus’ Instant Market Value: the used car’s estimated fair retail price.
CarGurus says that it “analyzes over 4 million used cars a day to give you the Instant Market Value.” That tells me that these prices are based on national rather than local data, which makes this information much less valuable. For that 2012 Toyota Camry, CarGurus showed an Instant Market Value of $15,996.
CarGurus also showed a Great Price Deal, which it explained is the price I could get if I listed the car on Car Gurus and wanted to sell it quickly. Is that a smart way to do things? Could I could get a better price if I was willing to wait a little longer? The Great Price Deal for the 2012 Toyota was $14,281.
CarGurus also listed a Dealer Trade-in Estimate of $12,109.
5. ClearBook by TrueCar.com: www.clearbook.truecar.com
On the TrueCar home page, if you attempt to search for a used car, it takes you to listings of actual used cars available in your area. However, TrueCar also offers a service called ClearBook, which describes itself as “the authority in used car prices.” Good to know.
In my earlier post on new car prices, I explained why I was not impressed with TrueCar.com. Similarly, when it comes to used car prices, I am not very impressed with ClearBook.
When I searched for prices for our 2012 Toyota, ClearBook asked if I want Natl (national), GS (Gulf States) or SE (Southeast) prices. Well, I don’t want any of those; I want to know a good price in my local market.
Actually, ClearBook claims to provide area-specific information. Here’s a quote from the website: “ClearBook collects and analyzes millions of vehicle listings and transactions to show car buyers and sellers the true value of a used car relative to similar used cars sold or for sale in their area.”
Doesn’t that statement contradict itself? Exactly how many 2012 Toyotas are available right now in the OKC area? Millions? I don’t think so. There’s only 4 million people in the entire state, not all of them are drivers, and not all of them are driving 2012 Toyota Camrys.
When I finally got to ClearBook’s prices on that Toyota, it listed a low, average and high “market sale price.” The prices ranged from $9,866 to $17,624, and it said the prices did not consider mileage or condition of the car. What possible value do those numbers have?
6. Cars.com: www.cars.com
Cars.com is the automotive classifieds site owned by Gannett, the nation’s largest newspaper company. Cars.com does not provided recommended prices for used cars. It does list actual cars available in the local market area, which is the subject of the next blog post in this series.
Comparing Kelley, NADA, Edmunds and CarGurus on Used Car Prices
So, here’s how the prices stack up for our 2012 Toyota Camry Sedan LE in good condition with 50,000 miles:
|Certifiedpre-owned||Fair retailprice||Trade-in value||Buy or sell to private party|
What does the above chart reveal?
* These tools are all over the map. The certified pre-owned cars differ by more than $1,500. The retail prices differ by more than $1,700.
* NADA lives up to its reputation for having higher prices, which benefits the dealers. However, notice that NADA also lists a higher trade-in value, so at least it is being consistent.
* My conclusion: If you want a low price, especially if you intend to quote your source for the price you are seeking, Kelley and Edmunds are both recognizable names that provide lower prices than the NADA site your dealer might want you to rely on. However, for trade-in value, NADA might be your best bet.
What an ordeal trying to get a fair shake on a used car! At Hasbrook & Hasbrook, we hope you find a great price on a great vehicle.
However, if down the road you suspect that your dealer scammed you by selling a car that has a fraudulent odometer reading or undisclosed damage from a collision or flood, then check out our webpage: “Auto Fraud and Auto Dealer Scams in Oklahoma.”
Then, contact us for a free consultation. You can reach us by telephone (866-416-4737), email (email@example.com) or our website contact form: Contact Us.