Buying a used car from any source, is always a risk. Buying from a private seller, can be the biggest risk of all, sold as seen, no guarantee, no option to pay with a credit card etc and with the possibility that a dishonest private seller might be lying through their back teeth about the overall state of the car. Plus, there are traders out there who pose as private sellers. To be honest, it's a minefield.
Buying any secondhand car carries some element of risk, even when purchased from a franchised dealer.
Franchised dealers normally keep any 'good' cars they take as trade-ins and sell them directly on their used car forecourt. The 'not-so-good' ones get sent to auction, and most of these are bought by second and third level independent dealers; indeed, that is where the lower levels of the motor trade get much of their stock. So buying a late model car from a non-franchised dealer puts you at a disadvantage from the start. If you see a car less than three years old on an independent dealers forecourt, the first question to ask yourself is why it's there.
Private trade sellers usually offer the worst cars of the lot; these are generally cars which the mainstream trade won't touch because they don't want the hassle of dealing with the inevitable aftersales problems these sort of cars generate. All reputable dealers have a list of 'private' traders who'll take the rubbish p/x'd cars off their hands, providing they're cheap enough. Unrecorded repaired accident damaged cars are also often sold this way and can be an absolute nightmare; you need to be on your guard for these. They can be temptingly inexpensive, but they are cheap for a good reason.
True private sales are a mixed bag; sometimes they can be very good cars indeed. You get the opportunity to meet the previous owner; sometimes that can tell you as much as inspecting the car itself.
Many years ago I was tasked with finding a used Volvo for my mother; I turned up a one-owner 4yr old example with 28k on the clock, sold by a local middle aged man who'd just qualified for a company car and didn't need it any more. The car was mint and everything looked 'right'; it went on to give another 10yrs essentially trouble free motoring.
But these sort of private sales are hard to find; you'll likely have to do a lot of legwork and, most importantly, walk away from anything that just doesn't feel quite right. Sometimes searching the history of the owner can tell you as much as searching the history of the car.
If you're thinking of buying a mass market small car with good residual value (and the 500 is one of these), it might actually work out cheaper to take out a pcp agreement on a new one than buy a 3-4yr old used one.
For those who are both handy and willing with the spanners, the economics are rather different. In particular, keeping a known good 3yr old car is not the same as buying an unknown 3yr old car off a forecourt. On the other hand, some new 500 owners have seen enough warranty claims in the first 3yrs to dissuade them from contemplating continued ownership once the warranty has come to an end.
