In this episode of Wealthion, host Andrew Brill interviews Brandon, a seasoned used car dealer and YouTube sensation known for his channel “Car Questions Answered.” Brandon shares invaluable insights on how to navigate the tricky world of used car buying, revealing common scams, the impact of current economic conditions on car prices, and essential tips for ensuring you don’t get ripped off. Whether you’re in the market for an affordable vehicle or simply want to stay informed about the latest trends and risks in the used car industry, this episode is packed with practical advice and insider knowledge. Don’t miss Brandon’s expert recommendations on what to look for, how to verify car quality, and the best time to make a purchase.
Brandon Reeves 0:00 The prices are moving faster now than they've ever moved before for me. And on a wholesale level, these these prices, they can't keep up because we're dropping. We're dropping very fast right now on a wholesale level. And it's a it's a it's a portion of what the car market normally does. We're getting back to seasonality in the car market, whereas we went through tax season, February, March. Wholesale Prices go to the moon, they they rip cars, people, people get tax checks back they go buy cars and wholesale prices. I mean, car dealers react. So if they sell a bunch of cars, they rush to the auction, they spent a lot of money. And then after that they get all this inventory. Andrew Brill 0:43 Welcome to wealthion. I'm your host Andrew brill, when is the right time to purchase a used car and exactly how do you go about it? We'll speak to an expert about all of that and more right now. I'd like to welcome Brandon the wealthion. Brandon is a used car dealer and also a YouTube sensation. He created car questions answered to make sure you don't get taken advantage of when buying a used car brand. And welcome to wealthion. Thanks for joining me. Brandon Reeves 1:14 Yeah, thanks for having me on. It's always great to be able to come and just talk about something that's maybe not all intensive with the car market. But I enjoy doing these kinds of interviews like this very fun. Andrew Brill 1:26 So tell us a little bit about yourself, your background, how you got into the used car market? Brandon Reeves 1:31 Yes. So about 13 years ago, I was going to school for engineering and hated it hated being in school. College was not not for me. So looking for any excuse ever to not go to class. So just happened to be one Wednesday night. My grandfather, who was a used car dealer at the time, was going to a used car dealer auction said okay, well, let me come help you because I don't have anything to do tonight, even though I had class. But I, I went with him and just immediately fell in love. I mean, oh, the car smells, the cars that are around this. And this was a small like country, little car auction, they were only running probably 50, 75 cars a week. But just really fell in love with the atmosphere, and started helping him out just putting cars online calls, small used car dealers, we're not doing that at the time. And this was at a time that the internet was doing real good. But the car market is just behind as far as technology goes always. And I put some cars online for him. And he would typically sell on like one or two a week and sold like five of them for him the next day. And I figured out you know what, I can do this. So I had a little sports car at the time I sold it, and then bought an $800 car for myself and use the rest of the money to start buying and flipping cars. And the rest was history. I just thought I fell in love with the business. Andrew Brill 2:58 Talk to me about used versus new cars. I obviously you're in the used car market, but you're a reputable guy. You're obviously here on the internet talent making sure that people don't get ripped off, because I would imagine there's bad actors out there. But what's the difference between buying a used car and buying a used car? Brandon Reeves 3:18 Well, I mean, the biggest thing is, I mean, obviously new is new. But the one of the big issues that we're seeing right now is you have to go through a dealer either way. And there's been a lot of outcry lately, especially over the last three and a three and a half years. Because dealers have really gouge people they have ad market adjustments, things like this, that that people want to go straight to manufacture. But the way that the system is set up, it's not really going to be the case unless you're looking at automakers that are entering the market that never touched the dealer space like a Tesla but what you're seeing that all these other manufacturers they have to go through the dealer system so either way if you're buying a new or used car, you still have to go through a dealer now on the use side you have a little bit more options because you can go through an individual um, you can go to public auctions yourself, but in most cases people are buying a car from a dealer and on the use car side I mean you're not getting a new product so there's there's a lot of the things that you have to actually check before you buy a used car because there's a whole course of just the problems that can arise with with the cars being used How was maintained before if it's even a safe car to drive right now so you're you're dealing with two different animals completely when you're thinking about buying a new car versus buying a used car. Andrew Brill 4:41 And you can buy a used car from a dealer bring it in your expertise is certified pre owned worth it. Or can I come to a used car dealer like you and say hey, look, you know what have you checked this car out? Brandon Reeves 4:55 So with certified used there are a couple pros and I would say probably more cons to it. I would say in my experience, the certified sticker that you're getting on these cars is is not worth the extra money that you're going to pay the certified car is going to be a lot more expensive. But what you get for that money that you're paying, a lot of times, you'll have some kind of extra warranty on the car. And then you'll have this basically checklist that that the dealer would have done on this car to make it certified. But all this certified inspection stuff is always done almost always in house. So it's their own techs that are doing this stuff. And really, it boils down to a little sticker because what they should be doing is really checking this car out before they're selling it as much as they're going to check out a certified car anyway, in my opinion, I think you can do these checks on a used car yourself, if you have the right kind of knowledge to be able to do it. But the you I mean, you're you're paying more money, but you're also usually getting a little bit more of a warranty on that car too. So it's in my opinion, it's it's not but there'll be a lot of people that argue that it is just for the for the added security that they feel like they're getting from this from the certified car. Andrew Brill 6:18 I just bought my son a car, I bought a certified pre owned a Honda Civic and a two door coupe, 2020 had 19,000 miles on it. So you know, it seemed like a good deal. So now I feel like after talking to you, I got ripped off, but the car has bought. I should have come to you first. But how do I get to a used car dealer and know that they're reputable? I would come to you and I'm assuming that you checked out the car, is there a way to check out a used car dealer and say, okay, you know what this guy isn't? Look, you have to be I have to be honest, there used car dealers have a there's a negative connotation to them. But I'm sure there's plenty reputable ones out there. How do you find the reputable ones. Brandon Reeves 7:07 So the sad part about this is there's there's no list out there, there's no way to know if if a dealer is a good deal or not, you can do some research, you can look at Google reviews. But a lot of times Google reviews can be fabricated. So a lot, a lot of the times if a dealer wants to spend time covering up that they're a bad dealer, they can be successful doing this. So a lot of it's going to boil down to your own research and being able to figure out if that particular car that you're trying to buy off this used car dealer lot is actually a good car. And then if you are actually getting a fair price when everything's said and done when you get the out the door price. So my biggest advice whenever I'm talking about talking to someone who wants to buy a used car, is make sure before you even go looking for a car you find a mechanic first. So there's another problem though there's it's hard to find an honest mechanic. But I would say it's probably easier to find an honest mechanic than it is to find a good dealer. And I think you can use Google reviews a little bit more on the mechanic side than you can on the dealer side. So I would do your research, find a small mom and pop place nowhere that's got multiple locations, no retail mechanics, I don't want you using that because they're I mean, they've got big locations and they've got many locations, and they have to figure out a way to pay for all those locations. Whereas a mom and pop small shop that's got just one location family owned something like that. They're they're usually trying to do right by their customer because that's how they gain more customers. So I would rather you go somewhere like that, get the car checked out before you purchase it. And then you can decide if the price is fair after you have your mechanic go ahead and check off on that car. So that's, that's my biggest, biggest advice may be, don't try to find a good dealer, just try to find a good car at a good price. And if that dealer just happens to have it, they can be a shady dealer or not. And as long as you do your due diligence, you can even buy a car from a shady dealer and still get a good deal and still get a good car as as long as you do your homework on it before you buy. Andrew Brill 9:17 So I know that you go to a ton of car auctions it's where you get your cars you check out and you have a mechanic I think in your family that checks out all your cars as well. So you you do the due diligence for the people. But I would assume some people who come to your used car lot have their own mechanic that checks out the car as well. Brandon Reeves 9:39 Yep, and we actually recommend that so our our biggest thing is when a customer comes in and they want to buy a car, my sell staff, one of the first things I say okay, well we would like you to go get it checked out by your mechanic before you buy it from us. We want to make we want you to know exactly what you're buying before you buy it from us. So the cars that we sell.Our niche, our special specialization is we sell cars $5,000 and under. So what that brings on is, the customers that we have is they have money for the car and really not much else. And this underserved place in the car market. And there's not a lot of dealers like us that can that can do this. And one reason why we are able to do this, like you said earlier is that I have a mechanic on staff. So a lot of the little problems that are going to nickel and dime a lot of dealers, we can handle those here at my shop. And what I feel like is a is a big benefit for for our consumers, they're able to buy an A to B car, but when you're buying a car that's under $5,000, some something's gonna be wrong with a used car, and it's under $5,000. So we want to make sure that we can check all the boxes from our side and find out what's wrong with the car and be able to let the customer know what's wrong with that car before they buy it. But we run through 75, 80, sometimes 100 cars in a month. And we were not going to we're not going to be able to catch everything. So it's very important to us that that a customer knows exactly what they're getting into it before they purchased the car from us. So that's that's one of my biggest recommendations. Whether that's a customer walking into my shop, or me giving advice on YouTube, make sure you have your mechanic check out a used car before you buy it. Andrew Brill 11:21 Do sites like Carfax and KBB help you at all in selling a car? Brandon Reeves 11:27 So we run a Carfax on every one of our cars. The big reason that we do it is because we're we're under the guidelines of the DMV in North Carolina where we are. So if we sell a car that has a salvage title, and we didn't know about it, then we can get in a lot of trouble from our DMV so so we make sure that we know any kind of brands that are on the car before it was theft, salvage, flood, anything like that. Now the auctions that we go to, they are supposed to let us know this information before the car even goes through the lane. But I mean it can fall through the cracks lies auctions, they don't run Carfax on the car, they run something they run another kind of history for which I feel like is not as in depth as Carfax So sometimes things can can slip through the cracks. And we can end up with a car that's salvage title, but we bought it as a clean vehicle at the auction. And in those cases, when we find it out, when we run our Carfax when we get it back to the shop to get it into our systems into our inventory, then we then have the option to take that car back to the auction and get our money back. But but that's the Carfax I think is a good tool. Especially if you're if you're if you know exactly the car that you want to buy, you know it's good mechanically, and then you know that you're getting a good price. At that point, then I would run a Carfax on a car because they are expensive for just a retail customer think it's like probably 30, 40 bucks a pop. So but I do think it's a good tool, but only to run it when you know that that's the car you want to buy. And that's just the last step before you buy the car to run one of those as far as KBB goes. There any kind of pricing mechanism that's out there is going to be wrong, especially right now because the market is moving faster right now then really in I've been doing this for 13 years, the prices are moving faster now than they've ever moved before for me. And on a wholesale level. These these prices, they can't keep up because we're dropping. We're dropping very fast right now on a wholesale level. And it's a it's a it's a portion of what the car market normally does. We're getting back to seasonality in the car market, whereas we went through tax season, February, March. Wholesale Prices go to the moon they they they rip cars, people, people get tax checks back, they go buy cars and wholesale prices. I mean car dealers react. So if they sell a bunch of cars, they rush to the auction, they spent a lot of money. And then after that they get all this inventory. And as soon as the money gets here, it goes away because people spend their tax refunds who want to buy cars, they have no more money to spend, dealer lots get loaded up. And now we're in that phase right here where prices are really tanking on the wholesale level, because a lot of these dealers are are overwhelmed with their inventory and they can't sell it and on top of that we're having just what's going on in the economy right now. I don't know if we want to get into that at all. But people are spending less money inflation is is out of hand and they just aren't able to buy cars right now. And prices on us vehicles, even though they're going down are still way overinflated of where they should be right now. So you're having basically this this perfect storm that's hitting car dealers right now where Okay, people have less money. They pay too much for their cars. They have too much inventory, their floor plans which is their credit that they use to borrow money against these These cars that they have on their lot, that interest rate is high. So everything is hitting these car dealers right now and is setting up for really a disaster that a lot of car dealers are feeling right this moment. Andrew Brill 15:11 So it's interesting, you talk about the economy, and the tax checks and I never realized that, you know, people get their tax refund, and a lot of people go out and we'll buy a car with some of that money. Is there a best time to buy a car? I mean, obviously, you guys know, okay, you know, tax season, I'm going to jack up my prices slightly, or some dealers will jack up their prices slightly. Is there a better time to buy a car than not? Brandon Reeves 15:37 Yeah, I'll correct you real quick. No, we did not jack up our prices during tax time. We buy a lot more cars going into tax time. And then we sell them at the same rates that we would typically all year and we just sell more cars, just to give you an example. So if we're going to average like 70 cars a month that we do hear, we might sell 125 Plus cars just in February. So that's that's the difference. We just sell a lot more cars are people that come and spend money and even at car dealerships that sell cars that are higher in the US, if they sell like that $15,000, $20,000 range, people have money for the down payment. So even that range gets hit during tax time because people are just spending money. But to go back to your question, in the best time to buy a car during the year is the end of the year. So around the holiday season, when people are spending money on other things other than cars, they're not buying cars. So that means car dealers need to move, inventory and prices are the lowest all year that they're going to be right at the very end of the year. Andrew Brill 16:38 I like the fact that you you talked about the economy, interest rates, how does that affect you? Do you go out and borrow money to buy inventory? And I would assume you buy less than or I would assume some car dealers do new car dealers? Certainly do they borrow that money and they have to sell the cars in order to pay back those loans. But how does that affect you and car dealers. Brandon Reeves 17:02 So most used car dealers, what they do is, is actually borrow money to be able to buy their inventory, they don't have any cash. They they're basically living paycheck to paycheck. And a lot of people don't know this. But I mean, most car dealers do not own their inventory. They they finance it through a bank. And that's not the way I operate. I've always run cash I've never taken on any debt. I don't I don't like that. So I I've grown my business organically every car that we have, we own we pay cash for. And that's just not how most used car dealers run. So as far as interest rates, how it has affected those car dealers that have borrowed money on their vehicles, their interest rates have gone up like crazy over the last three years, this is no secret we know this Fed has as pumped rates. And what this has has meant for a lot of these car dealers is okay. Well, if as time goes on, and as they're not able to sell cars, they're putting more money into each one of these vehicles. So we're having a it's an interesting time period as a as a car dealer, because over the last three years, car prices have gone up and up and up and up. But so have interest rates have gone up and up and up and up. But now we're getting to a place where Okay, interest rates have still gone up, but car values are going down. So we're seeing this tipping point where as interest rates have stayed high. And car dealers can't sell their cars, they keep on adding into what they have into the car, but their car values going down. So they're actually crossing where a lot of these car dealers are underwater on a lot of their vehicles. And what's interesting about this is that if they can't sell these cars in a timely manner, and therefore playing companies there where they're borrowing money, see some kind of problem, then car dealers can actually have their cars repossessed from them. And we're starting to see a lot more of that pop up at auctions where we'll see, I can see the seller on a lot of these cars. And some of them will just say floor plan. And what that means is the floor plan company went to this car dealer lot and I've talked to some floor plan reps. And they said, we go and we help these dealers sell their cars. And what that means is they go grab these cars off of these dealers lots, they take them to auction, whatever they bring, they sell them and then that dealer is on the hook for the difference. And there's going to be a difference. They're going to bring less money now than what they paid for them two, three months ago. And here's the problem there's dealers never had that money to begin with. So there's something I like to say a lot. And if this happens, then therefore plans will get decreased or just go away altogether. And at that point, they have no money to buy cars. If you can't buy cars, you can't sell cars, you can't sell cars can't make any money. You can't make money. Why are you even in business? So we've seen quite a few car dealers go out of business for this very reason. Andrew Brill 19:50 Does that happen with new cars, new car dealers as well you see all these ads about oh, these dealers couldn't sell these cars, huge discounts. Auctions does it do you find that it At some auctions, you're finding new cars because the dealer couldn't get rid of them, or does that the actual manufacturer come and take them back? Brandon Reeves 20:09 No. So what will happen is that a lot of these new car dealers, if they, if they can't move their vehicles to get them off their floor plan, they can do a couple things like save the auction, and they'll sell them. So I'll see cars pop up at auction. Like I've seen a ton of Jeep Grand Cherokees that have like 200 miles on them pop up at these auctions, and they sell them, they're still sold as brand new cars, they're selling through auction, so they've never been titled to an actual retail customer. So they can transfer that to another dealer. And then at that point, a used car dealer can then sell a brand new car to a vehicle, I mean to a to a customer that that does happen. Another thing they can do is they can do swaps between lots. So a lot of a lot of dealer groups have multi dealerships, a bunch of they have Toyota, they'll have Honda, Ford, and they'll have all of the all the manufacturers that have dealerships through all of them. So what they can do is they can actually move one from the Ford dealership over to the Toyota dealership. And that's what we're seeing a lot when I'm going into a lot of these dealerships and looking at cars. They're selling them as used, but they only have 500 miles on them. So this is what's happening a lot where they can get them off their floor plan, there's another lever that they can pull, that can actually move them into their their service loaner fleet. So when you go get your car fixed, and it's going to take a day, two days, you get they give you a loaner car. And a lot of times those loaner cars were brand new cars. And this is a way for a dealership to one move a car off of their floor plan and to show as a sale because these allocations that they get, how they get them is from turning and burning these cars. So it's a turn in earn system basically. So once they are able to sell a certain number of cars or whatever, then they get allocated some more cars. So if a dealer wants new allocations, they have to sell cars, they can't sell cars they have to get, they have to get resourceful. And there are a few levers that they can pull, just like I'm talking about here. Andrew Brill 22:09 Can you finance a used car? Do you deal with financing and companies that can finance it? Or do most of your customers come in and they have cash and they're going to pay cash? Brandon Reeves 22:19 So I'll say most of my customers, because it's 5000 and under, most of my customers are going to pay cash. Now when I say cash, it's not hard cash, they paid the full amount, debit credit card, something like that, or bring a cashier's check. But there are there are, there have been occurrences where they'll go to their credit union and they'll they'll borrow the money to get that it's it's pretty rare for for my customer to be able to do that. But for the next tier up that $5000 to $15,000 range, yet most of them are our finance. But I would say that, that we're we're it's very, it's very odd for us to be able to do the kind of business that we do, just because our cars are so cheap. I'm supposed to say affordable. They're cheap cars, right? So, yeah, I don't want to sugarcoat anything. I mean, we're trying to be as transparent as I as I can be, we sell cheap cars. But so that $5,000 to $15,000 range, most of those cars are actually financed. And they can do it a couple of different ways. Best way is credit union or their bank to be able to get the better interest rate. But what a lot of them do is what's called buy here, pay here. And this is where the dealership holds their own note. And so they'll go in, and this is a very predatory way of lending. And a lot of times that dealership that used car dealership that sell in that car, they're going to get maximum value on that car, and they're going to get the maximum interest rate that they can charge in their state. I know here in North Carolina, it's somewhere around like 25% that they can charge so guess what? They're charging it. Andrew Brill 23:56 I appreciate your honesty I know if you go to to carquestionsanswered.com on YouTube actually car questions answered on YouTube. You don't give your last name you don't give your dealership because you're here actually helped customers and I appreciate your honesty. The used car market, like we talked about has a negative connotation but you're trying to change all that so I appreciate the the information. So you're you know way back 13 years ago when you're helping your grandfather you started putting cars online and I'm gonna assume you're one of the first to do that you obviously help that his business it helps on your helps out your business those two places online dealers like Carmax Carvana, all those places. Does that eat into your maybe not into your business because you're selling cars on the lower end, but does that help or does that hurt us car business? Brandon Reeves 24:55 So as far as like Carmax is concerned they'll they'll take it out by cars and the cars that they don't want, they'll send into auction they'll put into us inventory. And then they run auctions. So I can go to a Carmax auction, I can, I can buy cars from there. So on that aspect, I feel like they help other car dealers, because it's just another avenue for us to be able to buy cars. As far as Carvana is concerned, I feel like if they were doing their business, well, it would eventually hurt a lot of used car dealers. But we've seen that I mean, money's money's hard to make doing it at that skill and with used cars. So if someone comes in and is able to do the Carvana model the correct way, then I think it really will change a way the way that a lot of used cars are bought. Now Carvana I mean, the technology and everything, the ease of it, a lot of people swear by it, and they want to use it. But we've seen that it's not, it's not crazy profitable yet. So it's going to be tough for a corporation to be able to come in and and be able to, to really hammer it down. And it's just an element of every use car is different. So it's very tough to scale, used car buying and selling just because every car has been maintained a different way. Every use car is going to have a different defect, every used car is going to have some kind of different things. So it's it's really hard to put a corporate number on cars like that. And it takes a lot of manpower to be able to actually check out these cars to know what the values of them are. So I'm interested to see what what happens in school and something's going to happen in the near future. To see how use Carbine is going to is going to look like I don't think I don't think Carvana is doing it well right now. But I think that they are opening the door for a another player that that will do it well to step in. Andrew Brill 26:54 So you talked about a salvage title. repossessions took me about a salvage title, because I was actually looking at a 2019. Lexus, and I was a little nervous about the salvage title. Is there a reason to be nervous about this? I know we can register the car, I know you can get a title, it's called a salvage title. Is this something that we should stay away from or be nervous about? Brandon Reeves 27:19 So I would say yes and no. So with a salvage title, it means that the car has been wrecked. And then it's been wrecked significantly, and then probably put back together, hopefully professionally. So here's the problem with a salvage title, or a car that's been wrecked, you could have it that maybe just the one of the panels of the car or whatever has been hit, but the insurance company deems that so expensive versus the value of the car that instead of fixing it, instead of paying the money to fix it, they just total it out. They make it a salvage vehicle. So in those cases, you can have good mechanics, good body body shop, a good body shop that actually can put the card together professionally, where it's safe it sound and everything and in that scenario, you're going to get a car and you're going to get a car at a very steep discount. The problem is the average consumer is not going to know whether the car was fixed correctly. If anything was done structurally to the car, because it's very difficult to know, if a car has had some kind of structural damage. What we've seen, as far as cars that I've looked at is okay, there could be a little bump up just on the rear of a car, it not even be salvaged. And that has jarred something loose in the actual frame, it has actually bent the frame of the car, and the customer is none the wiser. So I say yes and no to this, just depending on the expertise level of the consumer that's looking at this or the the level of someone else to check this car out for the consumer. So I would say for the average consumer, I would stay away from a salvage car. But for someone who knows what they're looking at, you can get a really good deal on a salvage title car. Andrew Brill 29:07 Now Brandon given the economy the way it is the personal debt rising the way it is. Have you seen a lot more repos than you have in the past? Brandon Reeves 29:17 Yeah, so we are starting to talk about this a lot on my channel and actually go to the auctions. And I show this on my channel. But we have seen repos rise greatly at these auctions and it started it started I would say about 12 months ago is when when I started to see the increase. I went to some bigger auctions where cars from Wells Fargo Capital One A lot of these big banks started to pop up and pop up. It seemed like all at the same time. About what, probably eight 910 months ago, even talking to a lot of the auction workers. They would say the six months prior to that they had no repos. And then just all of a sudden, we had cars from a lot of these big banks just really Flooding these auctions. And as far as some of the smaller auctions that I go to, those are the ones I'm able to actually show on my channel, those ones I can film at. But I see a lot of Buy Here Pay Here dealers, these ones that hold their own notes, what they'll do is they'll sell a car, customer miss co payments, they'll pick it up, they'll take it auction, they'll dump it. We're seeing many, many, many more cars in those repo lanes than we've seen in a very long time, at least in my 13 years of doing things. This is the most repos that I've seen come through the auction lanes. Since I've been in business. Andrew Brill 30:32 In preparing for this interview. I'm here in New York. So I went, I looked for car auctions, there's many, many car auction sites in and around New York City, the five boroughs. But I happen to notice that the the New York City sheriff and the marshals actually have auctions that I would assume cars they've taken that were involved in a crime or somebody you know, it was, you know, whatever it is, are those have you heard of those options? Are those options worth attending? Brandon Reeves 31:01 Yeah, we don't have a lot of those around where I am, I would assume that those cars are mainly theft vehicles. In anything that says seized within a crime scene, I don't know how they actually categorize those titles. I know the theft ones that easy when I see that a lot at these auctions pop up. But anything that's been taken in because of drugs, or any any kind of other crime or whatever, I actually don't have any expertise dealing with any of that stuff at all. But I have heard that there's, there's some guys out there they'll go and they'll they'll buy a lot of those cars, and you can get good deals because it's just, there's some there's some paperwork, you have to deal with that. It just makes up our process a lot more difficult. Cause we're doing scale, we're doing a lot of cars a month. So any kind of hang up by that even we're gonna save a little bit of money. We don't even want to mess with it. Andrew Brill 31:50 How would somebody check something like that out? Is there a way to check a title? Or let's say I, you know, I go to one of these auctions? And is how do I check out the title to this car? You know, I actually, they actually have the VIN numbers. So I went to KBB. And I plugged in the VIN number, it tells me what kind of car it is. But it doesn't tell me really who owned the car. And sometimes on these auctions, it'll tell you that it's actually a bank that has a lien on the car. So the bank gets paid off when the car is sold at auction. But how do you how do you check out a car as far as title and that sort of thing lien searches? Brandon Reeves 32:26 Yeah, so the best thing that I mean we talked about earlier, Carfax is the is what I use to check all these things they'll be able to tell you if there's a lien on the car, when there was a lien put on the car where the lien was put on the car, where the previous owner lived, not their address, but like city and state usually, they'll be able to tell you any kind of maintenance records that were filed at someone who's locked into the Carfax system. It'll be able to tell you when the car has been transferred, how many times how many owners it's had and where the where the cars been. So we use it a lot because we don't want to buy a car that's been up north. When we check Carfax we want to make sure we don't see New York on there. We don't see. We don't see Andrew Brill 33:11 Icy snow. Brandon Reeves 33:13 Yeah, we don't see that we don't want any any rust down here. You can give and keep that up there. So we use a lease contract for that. Andrew Brill 33:20 So we'll hang on to our rust laden vehicles up here and we'll sell it's used. Talk to me about the the used car or the EV. Market. Is there a used car EV market? Brandon Reeves 33:35 Yeah. and it's actually gotten hammered over the last couple months. So there's a few things that have happened. Elon has kept dropping prices over the last six months pressure, pressure, pressure pressure up. Tesla has missed deliveries like the first time in a very long time. So the adoption that was supposed to happen and supposed to be crazy is not coming to fruition how a lot of these automakers thought it would you have Ford Mach-E's, f1 50 lightnings not selling sit on lots dealers can't get rid of them. You're in that's making the use car evey side on that on that side crater also, then you have something else you have Hertz who because the prices have been been so volatile because people have not wanting to rent these EVs because they're scared of the range. Hertz got rid of its model three fleet so that's pushing even more downward pressure especially on the the model threes that are coming through auction I see hertz cars all the time now I go through a lot of these auctions and so so there's a lot of downward pressure right now happening so much so that I wasn't even interested in anything Evie. But because the prices got so cheap, I ended up buying a Tesla Model three for me just to try out and we're going to end up doing some some content on it. But I was not even close to buying one, six months ago because of the prices. But now because they've gotten so cheap and they've gotten hammered so much as a you know what, I'll take a gamble. And I'll buy one, throw a little bit of money at it just so I can drive one and figure out, figure out what it's like. And if I'm going to report on the current market, just like I'm doing here with you right now, I need to understand the technology. So that's something I wasn't even close to thinking about six months ago. And now because the prices have dropped so much, dipping my toes in the water. Andrew Brill 35:31 So we talked a little about interest rates, we talked about, you know, the Fed is now the expectation is that we're going to see an interest rate cut in September. How fast do you expect that to get to new car markets? And do you think that's going to energize? Because new car sales are dropping? There's no doubt that new car sales are dropping? Do you expect to see that pickup? And then how will that affect, you know, your market, obviously not your market, because a lot of people paying cash, but the five to $15,000 used car market? Do you expect more people to go out and start buying cars again. Brandon Reeves 36:10 I would anticipate you would have almost zero effect right when they first start because they're probably going to drop it by 25 basis points. So that's, that's not going to do anything for for buyers, what has to happen for the car market to get better for the prices to drop is, it's all supply and demand. So you're gonna have new car manufacturers on the new side, you're going to have them keep trying to pump inventory to dealers, which should put some downward pressure on the pricing. And then on the used car side, what we need is transaction. So the only way that we get more cars into the used car space is from people buying new cars trading in their old cars. And then those cars gets sent to the auction. So the used car space can't get better, until the new car space gets better, the new car space can't get better, until really monthly payments get better. And because people don't shop price, they shop monthly payments. So the way that monthly payments get lower is by MSRPs coming down, and by interest rates coming down interest rates, I think are going to be slow. So I think the thing that really fixes the car market and fixes it quickly, is for manufacturers to lower MSRPs. They have not shown a willingness to do this anytime soon. So I think we're just stuck in this rock and a hard place for the foreseeable future. Andrew Brill 37:32 However, you know, during COVID, it seemed like there was everybody going out and buying a car whether it be new or used. There weren't a lot of new cars, because production had stopped. Is that Did you see your business go crazy during that time? Brandon Reeves 37:47 I mean, we sold just about everything we could get our hands on. But the problem is we didn't make any more money because we couldn't find cars. So a lot. There's this big misconception that that a lot of dealers made a ton of money over that time period. Whereas Yeah, maybe our margins went up slightly. I'm talking about on the used car dealer side across the whole, yeah, maybe we made a little bit more money per unit. But the thing about it is we were selling so fewer, so many fewer cars, because we just couldn't get our hands on and there weren't in cars out there. And on the new car side, they were charging market adjustments. So they were able to make a lot more money on the new car side, because they were still getting cars from the manufacturer. Yeah, they were selling less cars, but something that they had never made money on before. I mean, new car dealers don't make very much money on the new cars that they're selling. But now, I mean, over over the course of the last three years, they were able to pump them an extra 10,000, 15,000. In some cases, we saw like $30,000 market adjustments on some of these average, like f 150s. And so yeah, they were making a ton more money then. But it didn't work that way on the used car side, because because we couldn't add this market adjustment. I mean, there's as a used car. So I mean, the price is the price is the price, or whatever the the market will pay. That's all we can charge for it. And so the problem is, if the market goes up on what a customer will pay for it, well, the wholesale value goes up. So it's not like we were still able to buy cars down here and then make this whole spread is that we were able to buy cars up here and still make that same amount of spread. It doesn't matter where it moves. It's just that that we made roughly the same amount of money but we're able to sell fewer cars. Andrew Brill 39:35 So Brandon, in closing, what's your best advice for someone that's going out and looking for a used vehicle. Brandon Reeves 39:43 So right now, pricing is an issue and it's going to be all over the place. So if you know kind of what you want. You want to find three or four dealers around your area that are selling a very similar car. You want to go check out all of them and you want to make sure that the car is good before you're actually buying it. Make sure you get your mechanic to check it out. Before you purchase the car. That's if I can leave your viewers with one thing is if you're going to buy a used car, have a mechanic first and then have them check it out before you buy it. Because whether the car is a $2,500 car, like some of the stuff that I'm selling, or if it's a $25,000 car, you can buy a paperweight very quickly. And a lot of times dealers after you buy the car, it's your their hands off. So you need to know what you're what you're going to what you're getting into before you purchase it so that if there's anything that you can take away from this, make sure you get a used vehicle checked out before you purchase it. Andrew Brill 40:45 So it's CQA car questions answered. You can find it on YouTube. Brandon, where else can we find you other than YouTube? Social media? Brandon Reeves 40:53 Yeah, we have two channels. I don't like social media, so I'm not on it. So we have as car questions answered on YouTube. And I've also got a second channel. It's called CQA. Live, we do a lot of live streams where I just come out and talk about what's going on in the car market. We show a lot of auctions on both channels. So yeah, check us out there. And that's all I want to be on. So if you want my phone number, just ask for it. And I won't give it to you. So. Andrew Brill 41:20 Appreciate Brandon, thank you so much. Awesome information. And hopefully, our viewers got a lot of insight into purchasing a vehicle. Appreciate it. Brandon Reeves 41:31 Yes, sir. Thank you for having me on. Andrew Brill 41:32 That's a wrap on another discussion here on wealthion. And thank you for joining us. 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