Blog CARFAX vs. AutoCheck: 10 Steps Before Buying a Used Car

CARFAX vs. AutoCheck: 10 Steps Before Buying a Used Car

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Using free online databases to check out a car’s history is always a good idea. There are two big names operating in the sphere, the current battle is between CARFAX vs. AutoCheck for providing vehicle history reports. Many used cars pass through an auto auction at some point in their lives and it’s generally acknowledged in the industry that AutoCheck does a great and accurate job of reporting cars that have been auctioned. Since both platforms are free, it doesn’t hurt to run and compare reports from both services.

A software designer named Ewin Barnett III started CARFAX in 1984 in Columbia, Missouri. Barnett was working with the Missouri Automobile Dealers Association on a system that would combat odometer fraud. The system started with a database of 10,000 records that were distributed via fax machine. By the end of 1993 CARFAX had expanded to nearly all 50 states. By 1996 the company’s website offered consumers vehicle history reports for free. Before buying any used vehicle it’s a good idea to run a CARFAX report on it and many dealers offer the service free of charge.  Checking a car’s pedigree before buying is always a good idea but checking CARFAX vs. AutoCheck is just one of the 10 steps you should follow before plunking down your cash.

How-to buy a used car in 10 steps

Buying a used car without getting burned can be done by following ten simple steps that include the following list.

1. Budget and Financing

You must know in advance what you can realistically afford to spend on a new car and stick to that number. You can buy a car with cash – assuming you have enough, or you can arrange financing. Many banks and credit unions offer auto loans that may require you to jump through a few additional hoops.  The dealer will also have financing options available and many times will be able to beat the bank’s rate. Shop around, because buying money is just like shopping for anything else.

2. Identifying Your Car

Cars are identified by make, model, and year. Make refers to the manufacturer, model is the name of the car and year designates when it was built. If make and model aren’t that important to you, you can also search through popular styles including sedans, sport utility vehicles (SUVs), convertibles, mini vans, coupes, luxury or wagons. Fuel type can also be considered in case you’re looking for a hybrid or electric vehicle.

3. Price Shopping

Punching in a car’s make, model, and year into the Auto Gravity site will give you a quick read on what you can expect to pay for a car. In the old days, this information was hard to come by but the internet has changed all that.

4. List of Prospects

Your Auto Gravity search results will likely contain several options that may vary slightly in year built, location, color, asking price, and available options.  Use the list to narrow your choices down to a few you would actually like to see and drive in person.

5. Checking History

This doesn’t cost you anything except the time it takes to create an account with CARFAX and punch in the data attached to your prospective new ride via its vehicle identification number. The report may reveal an accident history that could sway your decision. You can run the report yourself or many dealers offer the service as part of the sale. (for more on CARFAX, see below)

6. Contacting the Seller

Contact the seller in whatever method they prefer and ask some preliminary questions including, is the car still for sale, is it running condition, and when would be a good time to come over and take a look? If the seller is a dealer, try to work with one salesperson. Auto salespeople work on commission and things get complicated if you’re talking to more than one sales person at the dealership. Refrain from trying to bargain on the price at this point as a visual inspection may knock it out of the running. Be cordial, polite, and reasonable with the seller, as honesty and civility will serve you better if you get to the negotiation stage.

7. Take a Test Drive

Mark this down as a must-do.  Keep in mind that this is not a joy ride.  You should be paying attention to how the car starts, shifts, steers, and brakes. Listen for any unusual noises. Check to make sure all the windows and doors work. Test the window defroster, the air conditioning, if it has one, and the windshield wipers. Try the radio. See if the windshield washer works. Open the trunk, check for rust and corrosion. Look at the tires and inspect the tread. Look underneath where the car was parked and look for any fluid leaks. Pop the hood, even if you don’t know anything about engines and look for anything that looks like a leak. Don’t be afraid to ask questions. Look for pools of liquid along with cracks in hoses or belts.

8. Get an Inspection

To go a little deeper into the mechanics, take the car to a shop you trust and have them do an inspection. They’ll be able to look underneath the car, inspect the brakes, engine, and transmission. Somebody will have to pay for this – and even if you have to, it may be worth it to avoid troubles down the road.

9. Price Negotiation

Assume that the seller has a certain amount of negotiating room in their asking price. Haggling can be uncomfortable for everyone concerned but keep in mind that the seller wants to sell the car and if you’ve come this far, you want to buy it. The only unknown is how much. If you think the seller is offering a fair price and you are not comfortable negotiating, pay the asking price and move on to the next step. If you want to haggle on the price, make an offer below what you would actually pay in case the seller makes a counteroffer. If the seller takes your first offer, awesome. If the seller’s counter is somewhat closer to what you want to pay, that’s also  awesome. If they stick to their guns and won’t change the price then you must agree to pay the asking price or if you think it’s too high, be prepared to walk away.

10. Completing the Paper Work

If you’re buying a used car from a dealer, they can walk you through the paperwork fairly quickly as this is what they do for a living. If you’re financing the car the process starts with a contract to buy the car and a loan application. You can also get outside financing which usually requires a visit to your bank or credit union. Once the financing is approved, you’ll need to sign the loan contract. The dealer may offer you an extended warranty at this point, which may be worth your while depending on what it covers and the condition of the car you’re buying. The dealer will then set you up with temporary tags and registration that you’ll use until the permanent tags and registration come to you from DMV – depending on how that’s handled in your state. If you’re financing the car, the lender will hold the title until the car is paid off. You may get a copy, which will contain the lien information on the back of the title. If you’re paying cash, you’ll skip the loan application and loan contract and the title should be signed over to you clear of any liens.   

How does CARFAX work?

CARFAX tracks a car’s vehicle identification number (VIN), which is on the title, inspection records, registration, and insurance policy. It’s also physically attached or stamped onto various parts of the vehicle. CARFAX matches up VINs to reported air bag deployment, odometer records, “lemon status,” history of ownership, service records, title issues, and warranty information. You can also use a VIN decoder to aid your own research into your car’s history. The decoder will tell you what country your car was made in, who made it, brand, body style, engine size, and it’s production number.

Who offers free CARFAX reports?

CARFAX offers free CARFAX reports by signing up for a CARFAX account. In addition many car dealerships also offer free reports from CARFAX.

Should you buy a used car from dealer or owner?

Buying a used car from an auto dealership is usually easier for the buyer. Car dealerships can help with titling, registration, financing, and offer warranties that a private seller cannot.  Selling price maybe more negotiable with private sellers but not always.

If you buy a used car from a dealer what happens if it breaks down?

If you bought the car from a dealer who sold it to you with a full or partial warranty, the cost of repairs may be covered at no expense to you. If you bought the car “as-is,” you as the buyer would be responsible to any cost of repairs

What are the common problems when working with used car dealers?

Some of the most common problems encountered when working with used car dealers are questions about warranties, titles, financing, and inspections. Keep your eyes and ears open for the dealer mentioning anything about a salvage title (see our article: What Is a Salvage Title Car (and Should You Buy One) and be wary. Get everything in writing, don’t allow yourself to be pressured into anything and read the contracts.

What CARFAX doesn’t tell you.

CARFAX doesn’t tell you that their system for determining a car’s history is sometimes inaccurate.  They also don’t tell you that there has been many consumer complaints against them most of which relate to titling problems or errors that appeared in reports that went uncorrected even after they were pointed out. Although CARFAX is a good way to find out about any major mishaps with a particular vehicle, it is not perfect.  The company’s own disclaimer shows some holes where valuable information can fall through. The disclaimer says, “CARFAX depends on its sources for the accuracy and reliability of its information. No responsibility is assumed by CARFAX or its agents for errors or omissions in this report.” CARFAX in some ways is at the mercy of the organizations that report to it, which includes police departments, repair ships, insurance companies, and car dealerships. If the information reported is not correct or timely the report from CARFAX won’t be either. Also keep in mind that not every dealer and shop works with CARFAX so you may not be getting the whole picture.

Why is CARFAX important?

CARFAX is an important step in checking out used cars because it gives you good base of information about a particular vehicle. Assuming information about the car has been reported correctly, you can get a good overview of a car’s history or repairs, and collisions.

Will CARFAX show flood damage?

A CARFAX report will show if the vehicle has ever been in a flood as reported by an insurance company, repair company or auto dealership. Flood damage can affect a car’s mechanical or electrical systems. Bacteria can form in the upholstery or climate control systems. Brakes and airbag systems can also be damaged by submersion. The top ten cities for flood-damaged cars include both coastal and inland locations:

  1. Houston,
  2. New York
  3. Miami
  4. Philadelphia
  5. Dallas-Ft. Worth
  6. Chicago
  7. Tampa-St. Petersburg
  8. Detroit
  9. San Antonio
  10. Minneapolis St. Paul

CARFAX estimates that over 400,000 cars that have been reported to have been in a flood are back on the road.  Signs of flood damage in a car include musty odors, damp or loose carpet and upholstery, rust, mud that’s above the floorboards, brittle wiring, and fog or beads of moisture in light fixtures or the instrument panel.

How to read a CARFAX report?

In order to get the most useful information from reading a CARFAX report hit the highlights including information about wrecks and maintenance issues but it’s also a good idea to read between the lines. Take a look at how many owners the car has had and who the owners were. Find out if the car has ever been in a flood prone area or city. See if it has passed its emission tests.

What is a curbstoned car?

You can also use the CARFAX report to look for evidence of curbstoning. The report will identify the car’s owner but sometimes a car dealer will attempt to sell a car as a private individual to get around complying with lemon laws, avoid paying fees, disclosing information about the vehicle or pawning off title problems. Curbstoned cars usually appear in classified ads including sites like Craig’s List and are typically sold, literally at the curb as opposed to a dealer’s lot. You can use your CARFAX report to ask the seller key questions about the car, like where did you buy it, how long have you owned it and have you had any problems with it?” If the answers don’t sound right or match the report, it could be a curbstone situation. Other safeguards include asking to see the title and asking to see the sellers ID and matching it to the title.  If you’re shopping for a used car in the classifieds you can’t be too careful.


The secrets of finding great used cars, trucks, or vans for sale to buy aren’t actually secrets. There’s even an ultimate guide on how to find a used Tesla and how to finance it if you know where to look.   Doing your homework is absolutely vital when you are buying a used car.  It’s easy to get taken and dishonest people selling cars are out there looking for opportunities to take advantage of people. A little time spent on the computer looking at all the information that’s available on a particular car can save you a bundle. Anything you can do to arm yourself with accurate, logical data so you can make an informed decision is helpful. Buying a used a car can be a stressful situation. Dealing with a car dealership that can help with extended warranties, financing, titling, and registration can reduce stress. However you want to proceed it’s a good idea to follow the steps above and remember that comparing CARFAX vs.AutoCheck is one of 10 steps before buying a used car.