Numerous people have developed a car selling and buying business, all from the comfort of their home. A massive upfront capital or even in-depth technical know-how isn’t necessary, however, this would naturally be an advantage.

Nevertheless, if there is a large enough interest in cars, you are bound to get to grips with the mechanical quirks of cars. It also helps that there are a plethora of books available to broaden your knowledge.

Purchasing an inexpensive car is pretty seamless. There are numerous sources which include: Craigslist, Local Car auctions, eBay, Community noticeboards, and classified adverts.

Like with any business, purchasing cars can be a big risk, so if you aren’t willing to risk money, its best to keep it in a bank. However, the tips below are sure to aid in getting a decent return on investment.

Buy Low Sell High

This might seem like the most obvious statement to make, but to maximize profits, its best to purchase a car as inexpensive as possible while selling it for the highest price available. The only way to achieve this is to remove emotions from the process and not hope on finding someone you can pass the car to.

The used car market like that of the stock market runs cyclically meaning cars both new and used are typically hard to sell from January to March. This translates to you being able to get a bargain when you purchase during this period. Vehicles are linked to other goods and services that require massive amounts of money, so if there is a crisis in the banking or house sector, people tend to not purchase automobiles.

Check Twice, Buy once

The most wanted vehicles all over the world are so desired because they’re quick and exciting. This could be the reason some have been raced and might have been damaged. A couple of scraps on the car is a good sign a car has been partially maintained, but its best to take the car to a trusted mechanic to check it for structural issues and rust.

It is important to leave emotion out when purchasing, always examine every fault while considering its repair costs. If the costs are more than the profit hoped for, it is best to walk away.

Trust Your Instinct

While finger tapping and blinking are not to be associated with the insides of an automobile, it is best to trust your guts. If it sounds too good to be true, or the seller makes statements that seem off, it’s best to walk away.

If it seems like you missed a decent deal, you could always contact the seller again.

Talk to People, Advertise

Car owners’ clubs are known to be a hotbed of information, regarding where to locate the best spare parts, to which production years to keep away from. Its members also know what is needed to refurbish certain parts of the car. These members are also the best source of information should you want to sell a vehicle. Advertising is extremely important as fixing and buying. Information about dedicated classic car auction sites can be gotten from insiders. It is imperative to ensure the pictures posted on sites are of the very best quality to entice buyers.

Stay Away from Complexity

The dissimilarity between homes worth five hundred thousand and a million is typically in its finish. This isn’t any different from classic cars. It is best to avoid the most complex cars available. Having a faulty window or sunroof is something that could give any buyer leverage in negotiations, causing you to lose money. Vehicles like an older BMW 8 Series might appear to be a great bargain, thanks to its V12 engine, but it isn’t as a single engine management computer fault could incur a cost greater than the vehicle which then turns into a write-off.

Thinks to Check Before Purchasing a Car to Sell

The Oil Color

1. If the color is lighter, then the oil is of a good grade.
2. If the oil color is dark, this could mean it is due for a change.
3. Should the oil contain water, the best course of action is to walk away. This is evidence of a blown gasket, which is expensive to repair.

Water Temperature

1. Idle the vehicle for about 20 minutes, while overseeing the temperature gauge. Should it get three-quarters hot, it isn’t really a cause for concern at this point.
2. The high temperature can be an easy fix if the oil contains no water and air isn’t bubbling in the radiator. It is most likely a leak in a hose.
3. The next step is to look underneath the engine. It is imperative to take care when doing this, as the aim is to locate boiling water. Should you spot water dripping and its location, then the ball is in your court when it’s time for negotiations.
4. The above should give you leverage over the owner, by convincing them of the imminent and permanent engine damage. This means you can undercut his selling price by a sizeable fraction.
5. If there aren’t any visible drips, it is best to stop and leave. The issue is one that is most likely serious. The seller probably has an idea of this and wants to pass it on to you.

The Radiator

1. The radiator’s cap should be removed and while off, a second person should rev the engine in bits.
2. If air bubbles up with water, the best thing to do is to walk away. This is the result of a blown gasket. It is one thing to purchase an inexpensive car but it is another to get one that is trouble-free.

Listen to the Engine

1. Start the engine and then listen to it while it idles. There should be no loud ticking coming from it.
2. The engine should then be revved about halfway up while still being listened to.
3. Ensure all the cylinders are running when the engine is being revved. Should there be stuttering when the engine is being revved, it could mean a spark plug or its leads is faulty.
4. This doesn’t mean the issue is bad. It could mean the seller wants to offload the car as he/she thinks the issue is worse than it is.
5. It is imperative to involve a mechanic at this point to have a look at the issue if you still want to purchase the car.

Water Hoses and Engine Belts

1. Once the engine is off and has cooled down, inspect the engine belts and the water hoses, to gauge their general condition.
2. Should they need replacing, it is important to note that their expenses can be high and eat into the profit that would be made if the vehicle is purchased?

Check the Transmission

1. If the vehicle in question has an automatic transmission, switch it on and select the drive gear to see if there is a delay before it is engaged.
2. Repeat the above process for the reverse gear.
3. Selecting drive or reverse should be completely instant and smooth. Should any delay or jump be noticed when selecting the gears, the transmission isn’t great and might need replacement.

Is it Leaking Oil?

1. Ensure there aren’t any dreadful oil leaks.
2. Select the reverse gear and reverse from the car’s current location. Should you notice any oil drops, especially fresh ones on the surface, it is best not to purchase it, as oil leaks can be prohibitively expensive to fix.

Test the Brakes

1. Once on a public road, ensure there isn’t a car close behind you and the seller if beside you, should be informed of the moment you are about to perform a brake test.
2. Test the quality of the brakes by coming to a quick stop.
3. The vehicle should come to a stop without swerving, especially if the car comes with Automatic Braking System brakes.
4. Should the car stop at an angle, this is something that can be fixed reasonably inexpensively; the car could still be a decent purchase.

Test the Steering                                                    

1. When the engine is switched on, look out for play when the steering is turned from one side to another.
2. While engaging in a test drive on an open road, it’s important to check if the wheel has to be corrected every time. The vehicle should typically travel in a straight line.

Check for Rust

1. If the location of the car is in a location that sees relatively low rain, there shouldn’t be any signs of rust. However, in a location with every season, it’s important to look out for rust. Some localities tend to lay down road salt to battle snow and this can result in a vehicle rotting faster than it should.
2. Taking time to look underneath the vehicle and its inner guards is important. The bottom of the trunk and the vehicle sills should also be checked, these sills run along and underneath the vehicle doors. Should there be signs of rust, it’s best not to purchase the car.
3. Rust sometimes gets into areas of the car where it isn’t usually seen, such as the bulkhead. A vehicle with sills that are rusted could be rotting on the inside as well.

Things to consider

While purchasing and selling vehicles can be very lucrative, the business isn’t as direct as it would seem. firstly, there are numerous factors that need to be considered before diving in. below is a list of the major things that a seller might need before they are able to start trading cars.

Will I need a license?

Unfortunately, there is a plethora of information that seems to be contradictory. Some information states that persons are able to purchase and sell a maximum of ten vehicles at a point without having a license, while others state no license is required whatsoever, regardless of the number of cars a person aims to buy and sell. Nevertheless, it is imperative to read up on the statutes and rules governing the vicinity in which you plan to trade in.

The first thing to do is to declare the vehicles as supplementary income. It is important to note that you would need to pay income tax on the money made, should you go through with creating a car selling business. It is noteworthy to ensure all research is done regarding the amount or percentage of tax payable and any other legal and tax obligations.

Other considerations

In addition to any legal facets attached, there are a couple of other factors that need to be considered before going ahead to set up the business. First of all, purchasing pre-owned cars come with a lot of risks, as there are numerous fraudsters hoping to sell stolen cars. It is imperative to engage in HPI checks to avoid becoming a victim of vehicle fraud and scams.

These checks typically cover the vehicle’s history, including if it has ever been written off or if it was reported as lost or stolen. These checks do not cost a lot when undertaken yet the checks could save you money. Should you want to repair and then upgrade the vehicles you purchase, an important need would be insurance. There are varying kinds of insurance a car trader can benefit from, with Public Liability Insurance being a major kind.

Lastly, it might be necessary to get a commercial property where the business can be based. Although it is feasible to begin working from private property, this industry has a couple of stringent rules in place, especially if the aim is to keep some vehicles on the road until they are sold.

Conclusion

In conclusion, if done, purchasing and selling vehicles as a way of earning income can be a very satisfying career option. It is, however, important to properly research and be well versed on the legal facets associated with car trading before beginning.