5 reliable tips for using a car buying service
If you hate the idea of haggling with a dealership over the purchase price of a new car, a car buying service may be a solid alternative for you. You can search for cars online from the comfort of your own home, and some car buying services might have ways to keep more money in your pocket. Moreover, in recent years, more and more online car shopping service platforms have emerged, giving you more options to choose from.
Can car buying services be right for you?
If you hate walking into a car dealership and having to negotiate with a salesperson, a car buying service may be a good option for you. There are two main types of car buying services: concierge services and membership services. Concierge services can help you negotiate the price of the car and make the buying process easier, for example by delivering the car to your home or a nearby center so you can try it out before you buy it .
It might not even cost you as much as you think. In fact, many organizations, such as the AAA, warehouse clubs and credit unions, offer free car buying services to their members, says John Nielsen, general manager of engineering and repair. automobiles for the AAA’s national office in Heathrow, Florida. Nielsen says buyers who use these car buying services can save thousands of dollars on their purchases. “I know someone who bought a car through our program and saved $2,600,” he says.
While buyers have the potential to save a lot of money, not all car buying services are created equal, says Lauren Fix, founder of The Car Coach and Car Smarts and consumer automotive expert. She says consumers need to know what the car-buying service stands to gain from these deals and whether their goals are the same as yours.
1. Companies offer negotiation, convenience
Car buying platforms are for buyers who are short on time and unable to locate and negotiate a car, Fix says. For example, Carvana, a popular car buying service, offers fixed prices and can bring the car to your doorstep so you can test drive it for seven days. The cost can vary and some services charge a percentage of the cost of the car.
At Meriwest Credit Union in San Jose, Calif., members can take advantage of its Autoland car buying service. Using the service barely allows them to interact with anyone from a dealership, says William Fultz, auto broker at Meriwest Credit Union. Members are paired with a car consultant who will negotiate the price of the car on your behalf and work with them to secure a car loan through credit union. The car will be delivered to the financial center of your choice.
2. Free services are usually for members only
If you are a member of AAA, AARP, Costco, Sam’s Club, or a credit union, you may be eligible to take advantage of their free car buying services. Each program works differently, and some may offer the service of negotiating the price of a car on your behalf, while others offer pre-negotiated fixed prices. Some of these organizations and clubs may offer discounts, extra perks, and incentives that automakers offer exclusively to their members.
3. Buyers still need to do their homework
Before working with a car buying service, Fix suggests browsing automotive research websites, such as Edmunds.com or Kelley Blue Book, to find out the average selling price of the car you want in your geographic area.
Another benefit of doing your homework upfront is that buyers should have a good idea of what they want before contacting the service company, says Nielsen. “It’s hard to help you if you’re looking for minivans, sports cars and convertibles all at the same time,” he says.
Nielsen suggests narrowing your search to your top two or three choices, including make, model, color and options, before contacting a car buying service. “Think about what you really want to buy and how much you want to spend,” he says.
When a company has this information, they can work much more efficiently to find the car you want at a competitive price.
4. Understand how car buying services are paid
Although these services may be free to members, the costs are included in the membership fee.
As for concierge services, they may charge a flat fee or a percentage of the car price.
Car buying services can often negotiate lower prices with the dealership due to the volume of sales the dealership makes as a result, and they can pass the savings on to the consumer.
But buyers should be aware that the company might direct them to certain dealerships with whom they have business relationships, she says. “You have to ask yourself if you’re really getting the best price,” Fix says.
Fultz says the referral fee may not be the only benefit these companies enjoy. Credit unions often offer car buying services because they strengthen the customer’s relationship with the financial institution. “It keeps our in-house lending on a much higher basis,” he says. “It benefits us, the members and the dealers.”
5. Know the return policy
Consumers should make sure they understand the customer satisfaction policy before picking up the car or truck, Fix says. Otherwise, you might be stuck with a big purchase and something you’re not happy with.
You can find the return policy on the car shopping service platform’s website or by contacting customer service to ask what the return policy is. In addition to the number of days you have after buying the car to return it, check if there is a cap on the number of kilometers you can drive. If you exceed the number of miles, you will probably have to pay for each mile over the limit. As a general rule, the car cannot be returned modified or damaged – it must be in the same condition as when it was delivered to you.
The bottom line
Hiring a car buying service might be a good option for you if you don’t want to negotiate with a salesperson at the dealership, prefer to avoid setting foot in a parking lot, or are short on time. Before you call, do your homework and review details, like research automatic tariffsthe costs involved and the return policy of a car buying platform.