Before you spend a fortune on a used car, read this: 7 steps that protect your wallet and your sanity

Buying a car is an expensive proposition and often the second-largest purchase a Canadian will make in their lifetime. With the average new-vehicle price reaching almost $63,300 September 2025, according to AutoTrader Canada, it's no wonder Canadians shop around to try and get the best deal. For many Canadians that means skipping that new car feel and spending their time and money on a used vehicle.

While prices on used vehicles are definetly cheaper (than buying new), the cost of used vehicles isnt' cheap. Reports pin the average price for a used vehicle somewhere between $34,350 (1) and $36,900 (2). In fact, the propensity for Canadians to buy a used vehicle over a new vehicle has grown so much over the years that Statistics Canada now tracks used vehicle pricing as part of their ongoing Consumer Price Index report.

Save money with used cars, but watch the risk

There's no question that you can save money buying a used vehicle, but the used-car market comes with risk. A recent 2025 study of Canadian consumers’ experience with used-car purchases found that 77% of respondents reported issues or setbacks during the process. For buyers between the ages of 18 to 24, the percentage was higher with 81% reporting issues or setbacks (3).

With that in mind, it pays to treat a used-car purchase as a serious investment — one that deserves careful research, thorough inspection, and caution. To help, here is a seven step checklist to help you buy the best used vehicle for your needs.

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7-Step checklist: What to do before you buy a used vehicle

#1. Research fair market value and set a realistic budget

Before you ever contact a seller, use tools such as Canadian Black Book to determine what the car is really worth based on make, model, age, and mileage (4). Factor in all costs — not only the purchase price, but also insurance, taxes, registration, and likely maintenance or repair costs, such as new tires, and fixing suspension, rust repair, etc. (5).

Having a firm, realistic budget will help you avoid overspending, and give you leverage when negotiating.

#2. Always get a vehicle history report

Ask for a history or VIN report. In Canada, this report is known as a CARFAX report, from Carfax Canada — formerly known as CarProof. This report helps you uncover previous accidents, flood damage, odometer fraud or liens (debtors that have a claim on the vehicle).

In provinces like British Columbia, if you’re buying privately, a history report (or equivalent check) helps protect you from “curbers” — unlicensed dealers masquerading as private sellers (6).

#3. Inspect the car carefully — inside, outside, under the hood and underbody

Don’t rely solely on photos or a quick glance. Inspect the body panels for mismatched paint, gaps, dents, or rust — especially in the undercarriage, wheel wells, and other rust-prone zones.

Check tires (including spare), look for uneven wear, check tread depth, and signs of suspension or alignment problems.

Inside, test all features: Windows, locks, heating/air-conditioning, infotainment, seatbelts, lights. Rust, damp smells or mud in strange places (trunk, under seats) may suggest flood damage or neglect.

#4. Take a thorough test drive

Driving the car under realistic conditions — city, highway, hard braking, turning — is crucial. Pay attention to brakes, steering, alignment, suspension, odd noises, vibrations, or hesitations.

Test all electronic components, too: air-conditioning, heating, infotainment, and any safety or convenience features. Malfunctioning electronics can be costly to repair.

#5. Get an independent pre-purchase inspection (PPI)

Even if everything looks fine, hidden mechanical issues may lurk — worn suspension, transmission problems, frame damage, etc. A professional inspection is often the only way to catch these. Many garages recommend a 170-point or similarly thorough inspection.

The cost of the inspection (often a few hundred dollars) is minor compared with the potential cost of major repairs down the road.

#6. Verify documentation and seller authenticity

If buying privately (not from a licensed dealer), check that the seller’s identification matches the registration. Confirm the VIN on the car matches the registration and that there are no tampering signs (scratched VIN plate, inconsistent rivets, etc.).

If possible, complete the transfer of ownership at the same time as you pay, and ensure no outstanding liens or unpaid debts are attached to the vehicle.

#7. Budget for ongoing and unexpected costs

Used cars often come with more maintenance needs than new ones. Components may wear out sooner. Maybe tires need replacing, perhaps brakes, or rust-related repairs — especially relevant in Canadian winters where salt causes corrosion.

Also consider resale value: Some brands and models — such as those from Toyota, Honda, or Lexus — are known in Canada for reliability, lower maintenance costs and better long-term value retention.

What Canadian buyers frequently get wrong

Shopping for a used car can be timeconsuming and tiring. As a result, many buyers start to forget to complete necessary steps. Buyers will skip a thorough inspection or foget to get the vehicle's history report — the assumption is “if it looks clean, it must be fine.”

Another issue is that buyers focus only on the listing price rather than the total cost of the vehicle, including inspections, maintenance, repairs, registration, taxes, and insurance.

Another obvious but tempting error is to accept suspiciously low prices without verifying documentation or doing a VIN/ lien check.

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Final thoughts: Be patient, informed and ready to walk away

Buying a used car can absolutely be smart — especially in Canada, where used vehicles play a big role in the consumer car market. But the potential savings come with risks. By doing full research, getting a trusted history check, performing careful inspections and a proper test drive, and budgeting for maintenance and insurance, you greatly reduce chances of ending up stuck with unexpected repair bills or safety issues.

If something feels off — paperwork doesn’t match, the vehicle shows signs of rust or poor repair, the seller pushes you to decide quickly — be ready to walk away. In many cases, that’s the most cost-effective decision of all.

Buying used doesn’t have to mean uncertainty. With a clear checklist and a little patience, you can get a vehicle that gives you years of service — without costing you more in the long run.

Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

Clutch (1); Empty Tank (2); Canadian Auto Dealer (3); Canada Drives (4); Myers Automotive Group (5); Vehicle Sales Authority (VSA) (6)