PURCHASING A USED VEHICLE

When purchasing a used vehicle, there can be several things wrong that you cannot see with the naked eye.

One thing you can do is a LIEN SEARCH, which is a search into the vehicle's "past" to see if there are any outstanding claims against the vehicle, where the previous owner owes any money to another party.

Another smart thing to do is to look for hidden damage in and around the vehicle. Things such as tire tread, seatbelts, small cracks in glass, electrical, ...etc.

There are 6 simple steps to finding the cost of a used vehicle:

1) Cost of vehicle

2) Diagnostic test or repairs plus PST / GST.

3) PST on BOOK VALUE of vehicle.

4) Safety check (almost always $40 + GST).

5) Lien search (almost always $26 including tax)

6) Total of above 5.

EX You live in MB. You want to buy a used Ford Taurus from a private dealer, who is asking $1560 for the vehicle. A lien search will cost $26. Since your are not a mechanic, you will have to have a $35 diagnostic test done. Your mechanic tells you your car will need some engine work and it will cost $450, including parts and labour. The book value of this vehicle is $2100. You will also need a safety inspection. How much will the car cost you in total?

1) Cost of vehicle$1560

2) Diagnostic test or repairs plus PST / GST.(450 + 35) * 1.14 = $552.90

3) PST on BOOK VALUE of vehicle.0.07 * 2100 = $147

4) Safety check (almost always $40 + GST).40 * 1.07 = $42.80

5) Lien search (almost always $26 including tax)$26

6) Total of above 5.

= 1560 + 552.90 + 147 + 42.80 + 26

= $2,328.70

HOMEWORKpg.175; #5­10