A Guide to Buying a Used Car in Canada

Imagine you could wave a magic wand and find your next car.

Which car would you choose?

Would you choose a brand new car with top of the line technology features or a used car that saves you money?

For many, there are plenty of reasons to choose a used vehicle instead of buying new – it will save you money on car insurance, taxes, registration and depreciation.

Unfortunately, with thousands of options to consider, it can be challenging to find the perfect used vehicle. Luckily, we’ve made things easy. In this guide, we’ll outline the steps to take when buying a used car in Canada and answering some of the webs most asked questions on the topic.

Where to start


First things first, let’s talk about your budget. Budgeting for your car is the number one way to decide on the type of vehicle that you’re looking for. This is also your first step in deciding whether or not you’re looking to pay for the vehicle in cash or take out an auto loan.

Many Canadians choose to take on an auto loan to afford a more expensive model while keeping their savings in the bank. You can go two ways with an auto loan – you can decide to lease the vehicle for a period of time and then give it back to the dealership OR finance the vehicle, which allows you to purchase the vehicle indefinitely at the end of the finance term.

When buying a used car, a good rule of thumb is to put 10% of the vehicle cost down and pay it off with a loan within 3 years.

Choosing a Car

A used car dealer may try to steer you the wrong way when choosing your vehicle. That’s why it’s important to figure out what it is that you’re looking for ahead of time. Think about the reasons why you’re purchasing the car. For instance, do you travel a lot and need it to be fuel-efficient or do you have a family that needs ample cargo space?

By narrowing down the type of vehicle you’re looking for and the plan for each vehicle, you’ll be able to decide whether you want to buyout or lease your vehicle. Websites such as AutoTrader, CarGurus and Lease Busters, let you filter car models based on specifications, leaving you with a list of cars that you may be interested in.

Where to look for good used cars

There are a lot of websites that can help you with finding a used car. Here are a few for you to check out:


Many dealers use AutoTrader to show off their used car inventory, however, sellers looking to get rid of their vehicles also use the website. Each seller has to pay for their ad, which helps keep away scammers. AutoTrader is great for filtering their inventory by year, make, model, price range and features.

Kijiji Autos, Craiglist and Facebook Marketplace

All three websites allow users to post their ads for free, however, more serious sellers may pay for a sponsored ad. These are great tools for finding vehicles in your area, however, being aware of scammers is important here.


Think online superstore with a large inventory and no-haggle prices. CarMax is great for those who don’t like to negotiate, as pricing is clearly posted and won’t budget.

Lease Busters/ Finance Busters

Both websites are designed for sellers looking to get out of their current lease or finance terms. This may be a good website to consult for those looking to purchase a used vehicle. For instance, some deals may only have 5 months left on the lease with an affordable buy out price at the end of the term. With users paying to place an ad on the website, scammer rates are low, meaning you may end up with a great deal!

What to look for when buying a used car

When you’re looking for a used car, there are a few things to consider:


Google is your best friend when it comes to learning about your cars reliability. Searching for recalls and consumer reviews are your best overview of the vehicle. The price of the vehicle will also give you some insight into its reliability, as lower-priced vehicles may be at the end of their lifespan.

Vehicle History Report

Using the car’s VIN, you can run a vehicle history report on websites such as Carfax or AutoCheck. The report should come back with any serious accident claims, including fire or flood. Some car lots may spin the odometer back to increase the selling price, the vehicle history report can alert you of the real number. Some reports even show if maintenance was done on time and the locations where it was performed.


Find out whether or not any parts have been replaced, or if you have to replace any of them soon. If something needs to be replaced, it opens up space for negotiation.

How to negotiate a used car

Finding the perfect vehicle has its own set of challenges, but negotiating the price is a task you have to prepare for. Here are a few negotiating tips when buying a new car:

Do Your Research

Understanding how much the vehicle is worth is key to getting a fair price.  You can do this by looking at how much the same vehicle is worth in your surrounding area. Visiting websites like Kijiji and Facebook Marketplace will give you a great scope on the situation.

Get a Vehicle History Report

Now you should do this with any used vehicle you’re looking to purchase, but this is especially helpful when negotiating the price. If the vehicle has been in any accidents or has any outstanding liens, the negotiations will stay in your favour.

Other Factors

Make sure to consider factors such as:

  • Age
  • Mileage
  • Wear & Tear
  • Mechanical Issues
  • Accessories
  • Added Features
  • Upgrades

These are all factors that determine your room for negotiation. If something is not up to par it’s up to the seller to pay for the repairs.

Always remember to set a maximum price and not go over what you’re comfortable with. Have confidence in your offer and never rush a decision if you’re not convinced.

Can you lease a used car

Yes, you can lease a used car in some Canadian dealerships (call ahead to verify with your local dealership). This is especially popular when leasing used luxury cars – currently, Audi, BMW, Mercedes and Lexus all allow leasing used vehicles, but the interest rates do stay slightly higher than buying new.

Keep in mind that warranties expire on most vehicles after 3 years or 60,000km, meaning you’ll be paying out of pocket for most repairs. Leasing will still come with the same distance restrictions that come with buying a new car. Unless you’re looking to purchase the vehicle at the end of the lease term, you will be restricted on the amount of KM you’re allowed to drive.

How many km are too much for a used car

Most cars get an average of 20,000KM to 24,000KM a year. Therefore, anything over would be considered “high mileage” and will give you a bargaining chip when negotiating. Most cars will likely need something to be replaced every 50,000KM, so the question becomes how much are you willing to spend to upkeep your vehicle?

If you’re servicing your vehicle correctly, a vehicle can last a long time. Mechanics often reference Toyota Corollas with over 500,000KM that are still on the roads today.

Which brands of used cars are the most reliable?

According to consumer reports, Nissan, Toyota and Honda are considered to be among the most reliable car brands.  For over 13 years running, the Toyota 4Runner has had the top reliability scores, making it the undisputed champion. This SUV is not only considered one of the safest on the market, but it also holds its value well, even after some time.

If you’re looking for a Sedan, the Honda Accord has landed top reliability ratings between 2011 and 2017. Both the Toyota Prius and Nissan Leaf landed at the top in the electric category. While on the pick-up market nothing came close to Toyota Tundras reliability rating.

What is the cheapest most reliable used car to buy?

The 2016 Honda Civic is both parts reliable and inexpensive. If you’re looking for a great deal on a car that will last you a long while, the Civic is definitely the way to go!

Is it wise to use a line of credit to buy a used car?

Using a line of credit to purchase a used vehicle is never a wise decision. This is because a line of credit is usually secured by your home. If you are unable to make the monthly payments on your vehicle, the bank has the right to take your home.

What are the best sites to use to find reviews of cars?

Websites such as AutoTrader, CarGurus, Kelley Blue Book, Motor Trends and Driving.ca do a great job of putting out non-biased reviews on every vehicle. Each judges a car on similar criteria and compile information based on similar vehicles that have recently been sold. Ratings are based on factors like mileage, trim, vehicle history, as well as the price of the vehicle.

If you’re in the market for a reliable used vehicle, we’d be happy to help. Contact us for more information today!

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2019-05-15T13:01:34+00:00 May 13th, 2019|Car Guides|

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