If you are looking for a used car, you may be overwhelmed by the options available, and you likely have many unanswered questions. One of the most common questions used car buyers have is, “Should I buy a used car from a dealership?” There are advantages and disadvantages of buying a used car from a dealership versus privately, and it’s not unusual to wonder if one option is better than the other. You want to be sure that you’re getting the best deal for your hard-earned money, but you also don’t want to take any chances of buying a lemon, so how do you decide? The best way to go about your purchase is to make an informed decision based on the available tools. Consider these tips as you search for your “new to me” car.
Pros and Cons of Buying a Used Car from a Dealership
When you are buying a used car from a dealer, there are many factors to consider. You may not know the dealership that you find the car you’ve been looking for at, and if it’s not in your local area, you may not be able to rely on word of mouth from other customers that you know personally. If this is the case, you can turn to online reviews to get an idea of the dealership’s reputation. Keep in mind that people tend to post reviews more when they are unhappy than when they are happy, so don’t automatically assume that the dealership is terrible if they have a few negative reviews. You can also look at how long the business has been operating. Dealerships that have been in business for many years tend to have a good reputation, as they likely wouldn’t have made it if they weren’t doing something right. Take a look at these pros and cons.
Pros
- Financing at dealerships is a convenient way to easily take care of your purchase if you aren’t paying cash. They typically offer competitive interest rates. If you have decent credit, it saves you the trouble of running back and forth between the dealership and the bank to get everything finalized.
- Many dealerships offer used car warranties that give you a little peace of mind that you can’t get from a private seller. They also give their used cars a thorough inspection before putting them on the lot because they want to be sure they are offering a quality product that will speak to the reputation they are trying to uphold. These warranties may not be as extensive as a warranty on a brand new car, but they come in handy if you experience any problems soon after buying the used vehicle.
- Know-how. Because dealerships handle the paperwork involved with buying and selling cars every day, they know what they’re doing regarding registration, bills of sale, and title transfers. When you buy a car privately, you or the seller could make an error that may hold up the process of purchasing your car.
Cons
- Buying a more expensive car. When you shop at a dealership, it has a wide variety of cars on their lot, and the cars come in a wide range of price points. Not only could you be tempted to buy a car that is outside your budget, but the salesperson will likely try to encourage spending at the very top of, if not beyond your budget constraints. Be sure to know your top dollar and stick to it when you walk onto a used car lot.
- Dealerships may have the same car in roughly the same condition as a private seller is offering but at a higher price. This is because dealerships have business overhead such as rent or mortgage, utilities, property maintenance, and employees they need to pay. This means that they must figure a portion of this expense into the price they put in their cars, and they can only go so low before taking a loss. This means you may pay a little more at a dealership.
Pros and Cons of Buying a Car from a Private Seller
If you find a car for sale privately that you think is perfect for you, there are also many facets to the deal that you must keep in mind. Chances are you don’t know the person who is selling the car, so you have no idea what their motives are and whether they are honest about the vehicle’s condition. Because they are not a business, there are no reviews you can read unless they happen to be advertising the car on a website that tracks customer reviews on past transactions with the seller. If you are considering buying from private sellers versus a dealership, these pros and cons may help you decide.
Pros
- Less sales pressure. Salespeople on a used car lot are under immense pressure to make sales, as they rely on commission to make their living. They often transfer this pressure to their customers by acting aggressively and pushing the buyer to buy the car they are trying to talk them into. When you buy from a private seller, you don’t get the same kind of pressure. The seller may be motivated and a bit pushy, as well, but they typically seem much more relaxed about making the sale than dealerships are.
- Private sellers are more likely to be asking a lower price in general for a used vehicle than a dealership would ask. They also tend to be more flexible when it comes to negotiating because they either need the cash or want to unburden themselves of the vehicle because it takes up space in their driveway and costs them money for insurance.
Cons
- When you buy a used car from a private seller, you and the seller are responsible for taking care of all of the paperwork involved with the title transfer, registration, and sale. If you aren’t familiar with the process, it is easy to make mistakes that could hold up the process. Be sure to check with the DMV first to see what you will need to register your vehicle and take your time to fill out everything properly. If you have any errors on your paperwork, you will need to meet with the seller at their convenience to get things straightened out.
- No guarantees. Unlike a dealership, a private seller will not be offering any type of warranty on the vehicle you buy. If anything goes wrong, even as soon as you drive away, the financial responsibility for repairs falls on you. The best way to avoid any problems is to have your mechanic thoroughly inspect the car before buying it. Even if the seller is completely honest about the vehicle, there may be underlying conditions they are unaware of.
Buying a Used Car in Arizona
When you are buying a used car in Arizona or any other state, you must be very cautious about the deal, and you must feel comfortable with the person who is selling the car. Buying from a dealer vs. private seller is an issue you must decide on, but no matter which option you choose, you should walk away from the deal if you don’t trust the seller. There are plenty more cars on the market. If financing options are not working out in your favor, you may opt to buy through a finance company such as us, Red Mountain Funding. We can save money on taxes and approve almost anyone who applies.
I’m a kid at heart disguised as an auto researcher and business owner. I’ve always enjoyed providing insight in the form of reviews (anime, video games, autos, etc.) When I’m not researching, I’m spending time with my family, driving my Dodge Challenger, riding my motorcycle, and finding new entrepreneurial pursuits.
