TODAY

TODAY   |  May 01, 2013

How to find the best used car deals

For the first time in years, the economics are looking up for used car buyers. TODAY financial editor Jean Chatzky gives the lowdown on how to find the best deals.

Share This:

This content comes from Closed Captioning that was broadcast along with this program.

>> this morning on "today's money," buying a car. prices coming down. jean is here with great tips. nice to see you.

>> nice to see you, too.

>> why are used cars such a good deal?

>> they're the best they've been in five years. it's a supply and demand issue. there were not enough used cars on the market thanks to the tsunami, thanks to the economy being rocky.

>> people were holding onto their cars?

>> they were leasing as many but just off lease we're expecting 500,000 cars sold used.

>> you have great tips. you say, first and foremost, arm yourself with pertinent information.

>> right. so people think, and it's not correct, that buying a used car is just like buying a new car. they're wrong. when you buy a new car, one new camry is the same as the next new camry, it's a xhodcommodity. but if you're buying a used car , the miles, different options. it's hard to get a sense of what these cars are worth except there are great new websites like carguru.com which will tell you this is a good price on this particular car. this is not such a good price on this particular car. also, nataguide and kbb.com.

>> you talk about online, which you say cast a wide net. as opposed to going to a dealership, now have you the whole web to find a car.

>> you can buy from a dealer and you can also buy from individuals. most people type in they want to go to a 60-mile radius, expand it, double it. two hours from home will reduce your price by a great deal because have you more to choose from. also, research from car guru has shown if you buy in an urban location where there's more supply versus a rural one, you'll save on average more than $300.

>> that's interesting. in the city it's more than urban?

>> there's more cars.

>> i thought there would be more shoppers but that makes sense. you say financing, shop for financing.

>> you walk into a car dealership . you need to shop for the financing before you even go. interest rates are as low as they have ever been. the average used car loan right now, you can find one under 3%, which is amazing. and manufacturers like volkswagen and audi are offering under 2%.

>> and warranties.

>> well certified warrantied cars are a great way to go. have you to make sure you protect yourself no matter what you're buying. get the carfax or buy certified car.

>> what about haggling?

>> absolutely negotiate on these cars. over the last seven days people have saved 1500 on average off the used cars they've purchased. there's a lot of wiggle room. again, you need the information before you go.

>> as we touched on, consider certified used car and be careful out there.

>> you have to be careful because hurricane sandy, a lot of flooded cars ended up back on the market. you want to make sure you either have the carfax, which will cost you $40 so you check it out yourself. and pay a mechanic $100 to check under the hood or employ for a certified used car that will cost you a little more but you get an extra 50,000 miles on warranty.

>> and peace of mind .