Listening for a New Sound
Remember to gently tap the top and back of the instrument to make sure nothing rattles. (You're listening for loose bracing struts inside.) Look inside the sound hole for glue spills and other signs of sloppy workmanship. Check that all the pieces of wood join together smoothly and that there are no gaps between pieces.
An acoustic guitar's sound is principally made by the top — the back and sides reflect and amplify the sound. So a solid-wood acoustic guitar is preferable to a laminated-wood guitar (where the manufacturer presses together layers of inexpensive wood and covers the top layer with veneer). However, solid-wood guitars can be very expensive, and laminated-wood guitars can be pretty good. They are sometimes stronger than solid-wood guitars; the lamination process results in a stronger (though less acoustically respon-sive) wood.
With electric guitars, make sure that knobs, wires, and other metal parts are secure and rattle-free. Strum the open strings strongly and listen for rattles. A solid-body guitar is basically an electric instrument with no real loud acoustic sound. Some people will try and tell you that the wood an electric guitar is made from is irrelevant, and that it is all in the electronics. Not true! You should also make sure the pickups and wiring are in good working order. There should be no hum or shorts, and the volume and tone controls should all work without crackles and other noises.
An extremely important subject to discuss with your salesperson is the store's return policy. You should have the right to return your instrument for any reason, no questions asked, for at least a week after your purchase date, for a full refund (possibly less the ubiquitous “restocking fee”) or an exchange. Make sure you clearly understand the return policy that will apply to your purchase.
As when you checked out your first guitar, listen to how long the note will sustain. Fret a note and play it. Don't use an open string and don't move the string, just keep fretting the note until it fades away. Why bother with this? Well, a good sustain period is four seconds or more, which means the guitar will be good for playing fusion and rock. It also means the guitar is in good order. If the sustain is less than four seconds, then it's a questionable instrument and you should think twice about buying it.
Bear in mind, however, that this doesn't necessarily make it a bad instrument. There could be a number of reasons that the sustain is not longer. If the guitar is otherwise a bargain, a guitar repairman might be able to easily fix this problem. Have a professional check out the instrument before you make a final decision. The lack of sustain could be something as simple as a bridge that is out of alignment, a nut that needs to be filed properly, or old or low-quality strings.
Neck
Pick up the guitar by the head and peer down the neck to make sure it's not warped. Does the guitar have a truss rod? Most guitars now come with them, but make sure. Does the neck bolt on? You can usually see where the neck is attached at the heel with a heel plate, under which are four or five bolts. Fender-style guitars have bolt-on necks. Is the neck glued on? Classical guitars and the Gibson Les Paul have glued necks. It looks as though the neck and the body are made from one piece of wood.
Run your fingers along the edge of the neck to make sure the fret wire doesn't need filing or reseating. The fret wire should be seated well on the fingerboard, and the ends should not be loose or feel jagged. Do you prefer a neck made from ebony, rosewood, or maple? Cheaper guitars use mahogany or plywood stained black or rust red. The more expensive guitars with the better fingerboards are worth the money. Are the notes at the bottom of the neck in tune? Are they as easy to play as the notes at the top of the fingerboard? Do any of the notes have a buzzing sound even though you're stopping them properly? Is the intonation accurate? Do the notes on the twelfth fret correspond to the harmonics at the same place? The notes may have different tonal qualities, but they should have the pitch. Pay attention to the third and sixth strings in particular. On a guitar that's not set up well, or has a problem, these strings may be hard to keep in tune.
If you don't trust your own knowledge or ears, enlist the help of an experienced guitarist. It's vital that you don't buy something that's going to be really hard to play.
Action
The instrument's action, or playability, is determined by the setting of the string over and between the nut (at the bottom of the guitar) and the bridge (just before the tuning heads). Setting and adjusting these two things is a real art. The strings shouldn't be so low that the notes buzz when they are played, nor so high that the notes need a lot of physical strength to hold down. Since you are purchasing your second guitar, make sure you understand that this new instrument will feel different. Acoustic guitar action is always higher than a solid-body guitar action. If the notes are hard to play or out of tune, get someone in the store to adjust the instrument. If they can't — or won't — fix the instrument, don't buy it.

