Buying a pre-owned vehicle can be intimidating. No matter if you're buying from a dealership or a private seller, you should have a plan to help you buy exactly what you need, at a price you can truly afford.

Know how much you can afford

The first step in this process is to go to your credit union and talk to them about a vehicle loan. The loan officer can help you establish a budget based on your income and the presumed value of any vehicle you plan to trade in or money you intend to put down.

It's also a good idea to check with your insurance provider to see what your rates would be for a new-to-you vehicle in your proposed budget.

Make a list of what you like

Now that you have a budget, start to look at what vehicles you like in that price range. Call a few dealers, check a few websites, and pick up those magazines that are sometimes at the cash register of diners.

Auction sites are great places to check out, too. You can find some really good deals there. Sometimes you can get more car than you were expecting—just make sure you can afford the insurance.

Go shopping

Once you've decided on what vehicles fit your budget and transportation needs, go take a look. If you know a private seller who has a good deal but want to test drive the car first, it might be easier to go to a dealership with an identical vehicle for a quick test drive and then finish out the deal with the seller.

Check the vehicle history

Once you find a vehicle you like and want to buy, get its vehicle history report. You can get a vehicle history report from sites like CarFax. Dealerships should have subscriptions to these services and should be more than willing to provide them. Private sellers can pay a small fee and get one.

The reports will have any history of accidents associated with the VIN attached to that car. Some maintenance records will also be attached to some reports. If a private seller can’t provide any maintenance records, be cautious.

A dealership will have their technicians go over any vehicle they are selling pre-owned, so a maintenance record isn't as important. Be sure to get a dealer-provided warranty if this is the case, because they can still miss issues.

Negotiate

Having a budget in place doesn’t mean you have to use all of it. If you can spend less, great! Use the data you've gathered to your advantage. If the history report shows anything, ask for a discount. If an inspection shows anything, ask for a discount. If a private seller can’t provide any maintenance history, ask for a discount and be sure to have funds in reserve to pay for any problems that come up.

Know how much you're willing to spend on that particular vehicle and don’t go above it. That's why you established a budget and have a loan for a price point already.

Close the loan

If you were pre-approved in your first meeting with your loan officer, it usually takes a simple call to get the process finished. Let them know the final price and they should get the rest done on their end. Then it's a matter of sorting out how the seller gets paid. A dealership will most likely do a wire transfer or a check. A private seller will probably need a check.

All that's left after that is to enjoy your new-to-you vehicle!