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Buying a car online vs in person

Check out the pros and cons of car buying online vs in person to find the best way to buy your next ride.

When you’re buying a new car, one of the questions to consider is whether you want to do it online or in person. There are pros and cons to each, and depending on your buying style, one might suit you more than the other.

If you aren’t keen on either, you’re not alone. “Painful”, “confusing”, “time-consuming” and “a hassle” are how three quarters of buyers describe the car-buying experience. Buying online can remove the hassle and cut the time needed to find the car you want, but it can also be a lot more confusing if you don’t know what you’re doing.

Should I buy a car online?

There are lots of good reasons to consider buying a car online, such as taking your time to do your research without being hassled by overzealous car dealers.

The difference between car buying online vs in person is mostly a difference in the shopping experience. You’ll still need to test drive the car, and the end result, driving away in a car that you hopefully didn’t pay too much for, is the same either way.

Online vs dealership – the pros and cons

There are pros and cons to each method of buying a car, and they largely balance themselves out. You shouldn’t buy without a test drive anyway, and so you will almost inevitably buy your car partly in person and partly online. It can be a good idea to get the advantages of each in order to find the optimal deal.

OnlineIn person at a dealership
Benefits
  • Going online lets you take your time. Going online lets you do your research, comparisons and bargain hunting at your own pace. It also lets you look over more vehicles more efficiently and do it outside the pressure cooker environment of a car dealership.
  • You don’t have to deal with professional hagglers online. Car dealers are professional hagglers. Going online can lead to dealing with someone who knows just as much, or just as little, about cars as you do.
  • You can compare prices more easily online. Want to compare prices online? You can simply search for other cars that are the same make and model.
  • Car dealers have more options. You can get a wide range of extras at car dealers, many of which you can have installed right on the lot.
  • You can get answers to your questions. Whatever might be said about car salespeople, they are experts. If you have questions you can get answers on the spot.
  • Dealership financing. Dealers have financing options that you can apply for when you get your car.
Drawbacks
  • Going online takes longer. The flipside is that you can’t just grab the car you want and drive away.
  • You don’t know who the seller is online. Car dealers also sell online, and you often don’t know who the seller is until you’re buying.
  • You can’t compare prices as accurately online. You can’t really see what kind of condition a car is in if you just have a picture and a short description. This makes it harder to accurately compare prices online.
  • Car dealers have overpriced, unnecessary options. Those extras come at a cost, and odds are you either don’t need them at all or they’re a lot cheaper to get elsewhere.
  • High-pressure sales. This is one of the biggest drawbacks of a dealership. If you can’t handle sales tactics well, you might walk away with something you don’t want.

What you can do when you purchase online

When you buy in person, you get efficiency and the ability to ask your car dealer all the questions you need answers to before buying, but that’s basically it. By going online first, you can reap even more benefits:

  • Have prices to match. If you can find a new car for a certain price online, or even a used car in equivalent condition, you might have a lot more bargaining power and could even try asking a dealer to price match.
  • Thorough research. Find out how much it usually costs to buy the car you want, and then learn what to look for in a used car and how to pay less for a new car. Many of these tips work both online and off.
  • Filter your search. Imagine walking into a car dealership and telling them to show you only cars of a specific colour, within a specified price range, below a certain number on the odometer and of a certain make and model. Then imagine asking the dealer to line them all up in front of you so you don’t have to walk between them. This kind of filtering service is a normal part of looking for cars online.
  • Get more options. When buying from a car lot, your choices are limited to whatever is available on that lot and at any other lot you visit. When you look for a car online, you have a lot more vehicles to choose from and can find cars that closely suit your needs. You can then check those cars out. However, you still have to travel to inspect and purchase these cars, so keep the location in mind when browsing online.

Where can you buy a car online?

The benefits of going online, compared to visiting a dealership, can also vary depending on which websites you’re using. Each one is different, and one might suit your needs more than another. The following are some of the sites you can visit:

  • Autotrader. Thousands of car listings with detailed descriptions and key features. Research specific cars within a certain make, model, price range, year or mileage.
  • AA Carfair. Trusted NZ brand means you may be less likely to run into a dodgy seller but it reiterates that ‘all Content is provided “as is” and without warranties of any kind, either express or implied’. Allows you to apply for a check history report through the site.
  • Trade Me. A popular site for selling and buying used cars online. Comprehensive filtering makes it easy to narrow your search.

Car finance online vs at dealerships

Getting a car loan can be quick and easy at a car dealership, but as with many dealer extras, there’s a good chance you’re not getting the value for money that you could. Once again, going online first and looking for a better deal can give you more bargaining power, even if you do end up visiting a dealership.

The trick here is getting pre-approved for a car loan, with due consideration to how suitable the particular loan is for you. With pre-approval in your pocket, you can simply tell the dealer that you have a better finance offer and then see if they’re willing to match the terms.

Getting pre-approved for a loan involves knowing what kind of car you’re interested in, which generally means going online and checking your options beforehand. Buying entirely offline can bring convenience and efficiency benefits, but will rarely match the value of going online beforehand, even if you do eventually end up buying from a car lot.

Compare a range of car loans you can apply for online

Name Product Interest Rate (p.a.) Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee
FAST QUOTE
Simplify Secured Car Loan
6.25% - 12.50%
$5,000
$500,000
12 - 60 months
$100 - $500
Eligibility: Must be 18+, a New Zealand resident or permanent citizen and have an income of at least $500 per month.
See how much you could borrow without affecting your credit score.
MTF Finance Secured Car Loan
8.70% - 20.70%
$2,000
$100,000
3 to 60 months
$376
Eligibility: Must be 18+, be an NZ citizen, resident or have a work visa, and have a regular source of income.
Secured car loans from $2,000.
FROM 6.99%
The Co-operative Bank Unsecured Personal Loan
6.99% - 10.99%
$3,000
$50,000
6 months to 5 years
$155
Limited time offer: Pay a special rate of between 6.99% – 10.99% p.a when you borrow $3,000 or more. Offer ends 21 February 2022. Ts&Cs apply.
Floating-rate, unsecured personal loans
Kiwi Car Loans Secured Loan
7.45% - 19.95%
$5,000
$500,000
1 to 7 years
$195 - $995 depending on lender
Eligibility: Be 18+, an NZ citizen, permanent resident or have a work visa, and have an income of least $500 per week.
100% online secured car loans from $5,000
Lending Crowd Secured Car Loan
5.03% - 15.44%
$5,050
$200,000
3 or 5 years
$200 - $500 depending on the amount borrowed
Eligibility: Be a NZ resident/citizen and have a good credit score.
Borrow $5,050 to $200,000 for your chosen vehicle. 100% online with no paperwork or early repayment fees.
CarFinance2U Car Loan
8.95% - 23.95%
$5,000
N/A
1 - 5 years
N/A
Eligibility: Be at least 21 years old, have a valid NZ driver's licence and be an NZ citizen or permanent resident.
With a CarFinance2U secured or unsecured car loan you could get pre-approval for your next car in 30 minutes.
Nectar Unsecured Car Loan
8.95% - 29.95%
$1,000
$30,000
6 months - 4 years
$240
Eligibility: Must be 18+, an NZ citizen or permanent resident, have an income of $400 per week or more (after tax) and a stable credit history.
Unsecured car loans from $1,000 with payouts made within one day of approval. Applications entirely online.
Stadium Finance Secured Vehicle Loan
8.95% - 19.95%
$3,000
$100,000
Up to 60 months
Varies
Eligibility: Must be 18+ and must have disposable income of $300 per week
Secured loans from $3,000 and funds paid within one day of approval.
The Lending People Car Loan
6.95% - 26.95%
$2,000
$75,000
1 to 7 years
$50 - $695 depending on lender
Eligibility: Be 18+, an NZ citizen or permanent resident, in employment and earning at least $500 per week.
Secured and unsecured car loans of up to $75,000 from a variety of reputable lenders.
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