Editor's choice: Carvana
- Most credit types welcome
- 45-day preapproval
- Seven-day guarantee
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Today, nearly every step in the car-buying process can be completed online — from negotiating a price to signing the documents. But to make sure the transaction goes smoothly, there are a few things to keep in mind as you shop.
As a result of the coronavirus outbreak and shelter-at-home orders, US auto production essentially shut down in April. But if you do need to buy a car, dealerships across the country remain open with measures in place to ensure your health and safety. If you have concerns, reach out to customer service to learn more about what they’re doing to keep their customers safe.
When buying a new or used car online, you may want to visit manufacturers’ websites to get an idea of features and options, color availability, safety features and prices of different makes and models.
Most manufacturer’s websites let you enter your ZIP code for a list of vehicles that are available at dealerships in your area.
Once you’ve narrowed down your vehicle options, you can search online for your vehicle on a local dealership website or try out CarMax or Carvana. The process is similar in most cases:
Most people like to test drive a car prior to signing and having it delivered. This is the time to feel out how it handles, look over features and identify deal breakers that might pop up.
Take notes of the following before and after your test drive:
Vroom, CarMax and Cavana will let you return your vehicle under certain circumstances if you didn’t get a chance to test drive it before buying.
Additionally, as the coronavirus outbreak has limited how we interact with people, dealerships are taking added precautions to protect against the spread of the virus, which might include pausing test drives for the time being.
When buying or leasing a car, you want the best deal you can get for your price range. Shopping around and comparing your financing options will go a long way in determining how much car you can afford.
Here are a few places to begin your search for the best car loan offer:
Most banks offer auto loans or personal loans you can use to purchase a new or used vehicle. A bank will likely do a hard credit pull to check out your credit history. Typically, only applicants with good credit will qualify. Although banks usually offer competitive interest rates, they often also charge fees.
Many credit unions offer financing with lower rates than banks. They also often have less-stringent credit requirements. But you’ll likely need to join to qualify, which can add time to the process of getting financing if you don’t already have a banking relationship with the particular credit union.
With an online lender, you can often get better rates than at a bank or credit union, especially if you have good credit. Some online lenders will also work with borrowers with poor credit.
If you’re not sure where to start, online marketplaces help you compare offers from multiple lenders by filling out just one online form. But interest rates vary by lender, and you may pay extra fees.
Leasing can typically get you into a car with a lower down payment and lower monthly payments. With most leases, you'll have the option of returning or purchasing the vehicle when the lease is up. However, you’re responsible for maintenance costs and will have limits on how much mileage you can rack up — and usually have to pay extra fees if you go over.
Most auto dealers can arrange financing for you or provide their own financing. However, many mark up the initial interest rate offered by the financial institution they’re working with, which can add to the total cost of your loan.
The coronavirus outbreak has prompted deals, assistance programs and financing options for new and used car buyers. For instance, Carvana is offering no payments for up to three months and touchless delivery.
CarMax has a new program that started on April 14, 2020, called curbside pickup. When you’re ready to pick up your car or have it delivered to your house, you call and they will meet you — while maintaining six feet or more of distance.
Not all online car dealers negotiate. For example, CarMax and Carvana won’t let you negotiate a better price. And some dealerships won’t haggle unless you come into the showroom.
But if you are able to negotiate, prepare yourself by following these tips:
Not the best negotiator? Consider using a service likeTruecar, which will negotiate with dealers on your behalf.
Most online dealers offer delivery, but some come with restrictions. Here’s how delivery works with three popular online car-buying services:
If you buy your vehicle online from a dealership, once delivered, you usually have time to take the vehicle on a short test drive. And if you have a trade-in, this is usually the time they do a final trade inspection.
That’s all assuming the dealership offers delivery, and not all do. If you’re having your vehicle delivered from outside of a local market, a third-party transport company is often used.
Most return policies are in the contract you sign when you purchase your vehicle. But it doesn’t hurt to ask for a Carfax report or have your personal mechanic inspect the vehicle before you buy.
You might have better luck returning your vehicle if it's used. But even that depends on the state where you live and the individual dealership’s policies.
Here’s how it breaks down with three popular car-buying services:
Buying a car online is a relatively easy process that allows you to search multiple makes and models from the comfort of your home. But you may not be able to take a test drive until the car is delivered, and you can’t always negotiate a better price.
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