When you’re shopping for a used car, one of the first decisions you have to make is whether to buy from a dealership or a private seller. For most buyers, purchasing a used car from a dealership is the better choice. Here’s why.
Buying From a Dealer Speeds Up Your Search
One of the major advantages of buying a used car from a dealer as opposed to a private seller is that each dealership has many cars available. You can visit a dealership and look over dozens of cars in the same amount of time it would take to meet up with one private party seller to look at one car.
Finding private sellers takes a lot more research and footwork. Plus, you’ll have to arrange a time and place to meet with each seller that fits both of your schedules and is safe. Shopping at a dealership simplifies all these issues and allows you to view and test drive cars at your convenience.
Dealerships Are Regulated, Private Sellers Aren’t
Another important advantage of buying from a dealership is that you have more legal protection. Dealerships have to follow stringent Federal Trade Commission regulations and state laws, such as the FTC’s Used Car Rule and lemon laws.
These regulations can help protect you when purchasing a used car from a dealer, but you should still get a vehicle history report and take the car for a test drive. Another advantage of dealerships is that they’ll often provide the vehicle history report for you, saving you a search.
Dealers Offer Warranties, Private Sellers Don’t
Not all dealers offer warranties, but private sellers almost never do. If you want warranty coverage on your used car, you’ll need to shop at a dealership.
Warranties offered by used car dealers vary widely, so be sure to check out the details. Many dealers offer short-term warranties. A few offer money-back guarantees. Some warranties pay 100% of the cost of covered repairs while others pay only 50%.
If you’re purchasing a used car from a new car dealership, they may have a certified pre-owned program that certifies the condition of the vehicles and offers a warranty backed by the manufacturer.
Dealers Can Offer You More Options
In addition to offering warranties, dealers can also offer other options and promotions as part of the deal. These can include services such as free oil changes or tire rotations.
They may also be willing to perform cosmetic repairs or add items like weather-resistant floor mats to sweeten the deal.
Dealers Need to Protect Their Reputations
Used car dealers have an additional incentive to make sure the cars they sell are in good condition, and to make things right if they aren’t—and that’s their reputation. A dealer with several unhappy customers will soon have no customers at all.
Private sellers, on the other hand, can simply walk away after a transaction. Their livelihood doesn’t depend on people trusting them to sell reliable vehicles, so they don’t need to worry about protecting their reputation.
If you purchase from a private seller, you will definitely want to have your own mechanic inspect the car beforehand. That’s extra time and money that you may be able to save when purchasing from a reputable dealer who offers adequate warranty protection.
Dealers Handle the Paperwork So You Don’t Have To
Another great advantage of purchasing from a dealer is that they’ll handle the paperwork. Car dealers handle purchases all the time, so they know what needs to be done.
For instance, that paperwork generally includes a bill of sale, transferring the title, transferring the registration, and handling the applicable taxes and fees. Allowing a dealer to take care of all that for you can save you time, hassle, and a trip to the DMV.
Buying from a Dealer Means More Financing Options
If you need to finance your purchase instead of paying with cash, buying from a dealer can be helpful for multiple reasons. First, many lending companies will only provide financing for cars purchased from dealers, not from private sellers.
Second, the dealerships themselves may offer financing. This can be particularly helpful if you’re having difficulty getting a bank auto loan.
If you have been preapproved for a bank loan, you can compare the terms and rates to the financing offered by the dealership to see which offers the better deal.
Dealers May Accept Trade-Ins
If you purchase a used car from a private seller, the next step is often selling your old car, which means even spending more time and energy on the whole process.
On the other hand, if you purchase your “new” used car from a dealer, you may be able to kill two birds with one stone by arranging to trade in your old car as part of the deal. That can also decrease the amount of financing you need, saving you from paying more in interest than necessary.