You've come this far. Here you are sitting at the end of a stranger's driveway in their car. Palms sweating, you indicate a right turn. You are just about to begin the first drive of what could be your next car. Before you drive one block, turn around, say everything's fine and shell out $4,000 for a car, there are a few bases your test drive should cover.
When you are given the location of the car you are about to test drive, use Google Maps or Mapquest to familiarize yourself with the roads around the area. You want to plan out a route that will put the car in almost every driving scenario possible to ensure that you don't come across any surprise problems. You want to cover all of that as quickly as possible so you don't want to look like an idiot joyrider who came just to steal a car.
So, you will need a twisty road, a highway, a bumpy road and somewhere with a steep hill. On the twisty road you can get a feel for the steering to see if there is too much play or there is less grip than there should be. On the highway you can run the car through all the gears and feel for any wheel wobble at high speeds. You don't want to skip this and then find out the first time you drive on the highway your car vibrates as much as a teenager's cellphone. On the bumpy road you need to listen for any knocks in the suspension, and for any sort of squeaks or rattles that might end up driving you crazy. Anything that is loose or broken should become noticeable on a bumpy road. Finally, you want to see if the car has enough power when it is needed. Find a steep hill and see if the car will make it up without a big struggle. If it can maintain a steady speed up the hill without you having to floor it, everything should be fine. If it starts knocking or sputtering, there could be a problem that needs addressed.
The test drive is also a good time to get the car up on a lift and have either yourself, or a trained professional give the car a once-over. While you're under there you can take a look at the exhaust and suspension systems. See if there are any broken links between suspension components, or if anything is loose. Inspect the exhaust for anywhere that it might have rusted through, or for any loose heat shields that could be rattling. Also, look for anywhere that looks like it might have been repaired. A good mechanic will always be better at spotting faults than you are, and finding one is advised.
While you're out there, have a pad and paper with you to write down everything you notice. You want to keep track of all the little annoyances or faults with the car that the owner might not be aware of. If you find that the car might have some little faults here and there, but is overall mechanically sound then you are ready for the final step: the negotiation.
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