Buying a Used Car in Panama
Buying a Used Car in Panama
I came to Panama in August of 2011. The bus system here is fantastic and affordable, and rarely did I have issues getting where I needed to go in a reasonable amount of time. Traveling by bus is so easy, even my cousins (without a lick of Spanish) were able to travel the Pacific Coast and even go up into the mountains. The hit on the wallet is negligible as well: $2.50 buys passage from Coronado to Panama City – a deal I take quite often. For an entire year, I managed to get around with no car.
As my second year in Panama rolled around and as my responsibilities with Inside Panama grew with the company, I realized that the bus system would not be able to handle the all-day traveling I needed to do. As our photographer, I spend much of my day traveling into different real estate developments along the coast, and getting into and out of those by bus is time-consuming and often frustrating. So, I spread out my feelers and started looking for a car.
From what I could tell, there were three places I was going to find a used car: online, at used car dealerships, and by word of mouth.
First, I spent several weeks prowling the internet, getting a feel for the prices and keeping an eye out for deals. Sites like Craigslist, Encuentra24, and PlayaCommunity are all great places to find classifieds, and I must have looked through hundreds of ads.
Working with a small budget, I was surprised to see how expensive used cars in Panama can be. The car I ended up purchasing, for example, had a Kelly’s Blue Book value of $3,300 but in Panama runs at least $6,000. Nicer cars like the Honda CR-V will rarely be found below $12,000. While I blanched at these prices at first – sticker shock is always rough – I came back with a renewed determination to find a car at MY price. MY price, just to be clear, was likely much lower than YOUR price.
The second place I went to was the used car dealerships. Robert and Steve here on the Pacific coast run a used car dealership called Gold Coast Rentals, and they were a fantastic source of information. Their clientele, though, was more those buying new condos and homes rather than those working as photographers in a third world country.
Through a Facebook group for expats here in Panama I was put in touch with several people who would travel with me to dealerships in the city, translating and bringing in mechanics to check the cars. I was close to making a weekend trip to Panama City with one of these people when a deal appeared just down the road. The third method of searching, word of mouth, brought me there.
One of the best times to secure a deal is before someone leaves the country for good. Like with mini fridges in college towns at the beginning of summer, prices on everything from furniture to cars drop well below market value when someone is trying to make a bit of money before they leave. Several friends all called or e-mailed me on the same day, letting me know that such a couple was planning on leaving any day, and wanted to unload their car to make some cash before they left. I quickly met with them, and we negotiated the price until I had it within my budget. After talking to the mechanic who had worked on the car often, after having it checked out, and after taking it for a test drive myself with a car-knowledgeable friend, I was satisfied that everything was in order.
While nothing is ever sure in Panama, buying a car FSBO (for sale by owner) is the least certain method of them all. You can brings in mechanics and test drive the car, but even above the due diligence, what you need in FSBO transactions is trust. I had great character referrals for the sellers, and they were helpful and communicative with any questions that I had. If you ever feel that something is off, it’s best to just walk away. Fortunately, the deal that fell into my lap also seemed to be a solid one.
Len Melso (left) and his team at PanamAuto, in between Coronado and Gorgona
After we agreed on the terms, I had to wire them the money. They used a small, Canadian bank, and I had to send the money from Bank of America. Warning: make SURE that you have every single piece of account information possible for such transactions. If even one part is wrong and the money comes back, you still lose quite a bit through the currency conversions and transaction fees. I learned this the hard way. Still, three days later I had paid in full for my new car.
The next step was to register the car in my name. Getting through the bureaucracy in Panama is more than a hassle, and if your Spanish is not up to snuff I highly recommend paying someone to do everything for you. I used Tyrone, whose information and prices I have listed at the end of the article, and couldn’t be happier with the service he provided. I provided him with the transfer of ownership papers, the title, a revisado (inspection papers), and copies of the seller’s passport and mine. He took them all into the city, went through the notary process, and came back with a new title in my name!
Finally, I needed to insure my car. Unless the seller adds you to their insurance, you are required by law to purchase new insurance upon title transfer. The Panama government mandates that every car owner purchase insurance to cover physical damage caused by running into a person on the street. Any insurance you buy after that is up to you.
My car is over ten years old, and thus expensive to insure in certain areas. But for just over $300 for the year I was able to attain the government-mandated insurance and more-than-ample coverage for medical and legal fees, theft, fire and falling objects. I was also guaranteed roadside towing and gas supply, to a certain extent, for the year.
I worked through Julio of J2L Associates, and again was very happy with the service his company provided. Julio has an office in Panama City, but every Thursday he sees clients in a room at the back of our office in Coronado.
So there I was, a proud new owner of an insured car that ran like a dream.
No matter how much diligence you do, sometimes things just stop working. That’s what happened a few weeks after I bought the car: 0 to 60 in 6 seconds turned into 0 to 60 in six weeks. I was crawling along the highways, and needed to find a mechanic pronto.
Several people referred me to Julio, a mechanic just outside of Coronado with good equipment and a solid reputation. I typed out and translated a list of my issues, and then checked the Spanish again to make sure that I was as clear as possible in describing my problems. I left the car with Julio and his assistant Carlos, and they told me they would call at the end of the day to let me know what the issues were. I said thanks, and took a taxi to the office.
Cue five o’clock, and still no word from the mechanics. I found their number, and called to see what was going on. He told me he had no minutes on his phone, so couldn’t call. I was frustrated, but said fine and went to see in person what the issues were. He walked me through several parts that I needed to repair