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Disadvantages and Advantages of Buying A Car Online

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These days you can purchase just about anything from the comfort of your  home with just a click of your finger. Whether it's clothes, furniture, food, or medication it’s becoming easier and easier to purchase all of your necessities on the internet. Online shopping has become more convenient than ever. When it comes to buying a car online, can you trust the internet? Or is the car buying process too personal to lend to a web-based interface?

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No doubt, there are several advantages and disadvantages to buying a car online. While some consumers value the traditional in-person experience of a dealership, others are keen on being a part of the internet’s revolutionary changes in the car buying process. Where do you stand?

What’s Involved In Buying A Car Online?

Gone are the days of spending hours traveling from dealership to dealership searching for the perfect car or SUV and spending even more time negotiating a deal with a representative. Believe it or not, customers are choosing to take on the car buying process right from the comfort of their homes. In fact, a report published by ABC News revealed that more than thirty percent of new car sales were completed right from the internet. However, before the pandemic, online auto sales represented less than 2% of the market. 


Another survey that analyzed consumer behavior showed that most consumers already rely on the internet to shop for cars. Approximately 59% of the respondents used popular websites like AutoTrader and Edmunds to research different types of cars. Over two-third of car shoppers use social media and other online websites to find cars listed for sale in their area. They also rely on internet-based resources to calculate the current value of their vehicle and calculate car loan payments. 


According to experts, the process of buying a car online is no different from researching a new cell phone or laptop you’re interested in and finally making a purchase. If you’re leery of purchasing a car online, you’re already completing 90% of the process online already. 

Is It Best To Buy A Used Or New Car Online?

You might be wondering whether it’s best to purchase a new or used car online, especially since new car buyers and used car buyers are often viewed in a different light. One thing that both of these buyers have in common is that almost seventy-five percent of them use apps and websites to perform thorough research when shopping for a vehicle. 


Buying a used car online has gotten easier than ever  thanks to popular portals like Vroom, Carvana, AutoTrader, and Shift which are continually making headlines for their record-breaking sales. These services operate in all fifty states which helps make the buying process seamless. In addition, they spend millions on marketing each year which further reinforces buyer confidence. 

On the contrary, when it comes to purchasing a brand new vehicle online, things can get a little tricky. Many new car dealerships and dealer groups also provide customers with an online platform to purchase a brand new car. Traditional dealership services like conducting test drives and comparison services can vary upon the platform. 


What are the advantages and disadvantages of buying a car online?


Pro: Buying A Car Online Saves Time

Perhaps one of the most significant benefits of purchasing a new or used vehicle online is that you’ll save a lot of time. The idea of spending an entire Wednesday evening or the whole weekend visiting different car dealerships to find the right car for the best deal can be really tiresome. Yes, the traditional method of shopping for a car can be laborious. Customers often spend several hours haggling for a deal only to settle into a deal that they're not entirely satisfied with. 


Buying a car online is a much simpler process. Typically, auto prices, car features, loan options and much more are all presented on one webpage which streamlines the shopping process. Time-consuming chores like filling out the paperwork can be done at the customer’s leisure. 


Pro: You Don’t Have To Worry About Haggling Or Being Pressured Into Buying A Car

Perhaps one of the most frustrating parts of buying a car at a traditional dealership is being haggling by an overzealous sales representative who desperately wants the commissions. In some instances, their livelihood depends on their ability to seal the deal. In addition, car dealerships do their best to make the car buying experience an emotional experience. This is why they’ll have you sit on the plush leather seats and experience the surround sound system. 


When you buy a car online you don’t have to worry about being subjected to intense sales pressure. As a result, you’ll be able to make a clear-headed decision. Although the deal and car buying process is guided by a sales professional there is no personal contact that allows you to get right down to the business.


Pros: Dealers offer a return policy when you purchase online

In the real world, it's nearly impossible to come across a dealership that offers a return policy. They aren’t legally obligated to take a car back after you sign that dotted line and take the vehicle home. So if you purchase a car that you realize you don't really like you are pretty much stuck with the vehicle. 


However online car dealerships offer a money-back guarantee if you aren't happy with your online car purchase. You’ll receive a full refund if you initiate the return process within the next 7 days. You’ll also be presented with the option of exchanging the car you purchased for something else. Of course, some policies regulate returns and you should thoroughly review them before making a purchase. 

Pro: You can expand your search beyond your geographical area 

Do you have a specific vehicle in mind that you want to purchase? Sometimes it can be difficult to find the vehicle that your heart truly desires within your geographical location. You may have to expand your search to the next city or state over. In addition, broadening your search can help you find the car that you want at an affordable price.  Apps like Wheel Wish allows user to put down a small deposit while it searches the entire United States for you dream car.


Pro: You still get to test drive the car 

If you’re worried about missing out on a chance to test drive the car that you’re considering purchasing, you’ll still get that opportunity if you purchase your car online. While platforms like Vroom and Carvana don’t technically allow you to test drive a vehicle before you sign on the dotted line as previously mentioned you’ll have a 7 day return period after you purchase a car. However, if you purchase a car from social media sites like FaceBook and Craigslist you’ll have to meet up with the dealer and you’ll have the opportunity to test drive the vehicle. 


While there are several advantages to buying a car online, there are some drawbacks. Here are some of the main disadvantages of buying a car online?


Cons: Limited financing options 

One of the biggest drawbacks of buying a car online is that your financing choices are limited. Typically, when you buy a car from an online dealer you’ll have to finance with them through their lender. Financing through the dealer can be expensive due to the high APR rates. Your best bet is to secure an auto loan in advance through the bank of your choice. If you belong to a credit union you should apply for a loan in advance. Securing a car loan in advance can give you some leverage when communicating with online dealers.


Cons: You don’t get a lot of wiggle room when it comes to negotiating terms or pricing 

One of the downsides of buying a car online is that in terms of pricing what you see is what you get. If you decide to do business with reputable platforms like  Carvana, Vroom and CarMax pride themselves on their no-haggle no-hassle policy which makes your car buying experience as simple as possible since it eliminates the car pricing games. Also, these websites use a competitive pricing model which means there is no negotiating on the price. The upside is you don’t have to worry about paying any extra dealer or documentation fees as you would normally have to pay at a traditional dealership. 

Cons: Limited Trade-In Value 

An essential part of buying a car online is the trade-in process. If you are not up to selling your old car on your own then the trade-in value of your vehicle becomes an essential factor. When you trade in your vehicle with an online car dealership you don’t have any negotiating power when it comes to how much they deem your vehicle to be worth. So if you’re not happy with how much money the online dealership is offering for your old vehicle you’ll have to consider other alternatives to selling your vehicle. 

Cons: You may have to pay shipping fees 

Online dealerships like Carvana, Carnac, and Vroom are continually working to expand their physical locations. In the meantime, if you purchase a vehicle from these vendors that are not within your geographical location you’ll have to pay a fee to get the vehicle delivered to your home. Such fees can range anywhere between $100-$590 depending on your exact location. However, the shipping fee will be refunded if you decide to return the vehicle. 


Cons: You don’t always get that value in-person experience

Another major drawback to buying a car online is that you don’t get to see and feel the vehicle before you buy it. While most online dealerships have a physical location if you aren’t located within the vicinity of one of their locations there is no way for you to get to view the vehicle beyond a few online photos. A lot of buyers value that in-person experience because “to see is to believe”. 

Is Buying A Car Online The Right Move For You?

Buying a car online can be a smooth and easy process depending on what you’re looking to get from the transaction. If you need speed, convenience, and a stress-free experience then buying a car online is the best decision for you. Also, if your the type of buyer who wants to see, test drive, and feel the car before you buy it and negotiate with the dealer then buying a car online may not the best experience for you. 


Common Questions 

Q: What is the best online car buying process?


The best online car buying sites in 2021 is:


  1. AutoTrader
  2. CarGurus
  3. Vroom 


Q: What is the safest way to purchase a car online?


The safest way to purchase a car online is to first start by setting a budget, perform thorough research, and secure the best deal for your budget. Once you secure funding for your vehicle you will be able to speak to a sales manager who can answer any of the questions you might have. 


Q: Is it cheaper to buy a car online or in-person? 

A study conducted by iSeeCars found that people who purchased a car online saved an average of $185 or 0.08% more than they would have if they had shipped at a traditional dealer. Also, online dealerships use a competitive pricing model to entice customers so customers don’t need to negotiate prices. 


Q: Can you buy a brand new car online?


Websites like Costco Auto, Cars Direct, and Overstock allow online shoppers to also purchase a brand new car online for an affordable price. 


Q: Is it smart to buy a car online?

Purchasing a car online offers several advantages over traditional methods. Buyers can find the car they want rather LT quickly through online research which also helps them determine if the car dealer is reputable. Also, when you buy a car online you have so many more options. 


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