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How Does a Car Buying Service Work?

How Does a Car Buying Service Work?

When considering how to use a car buying service, perhaps the best entry point is to weigh the pros and cons. Learning how to use a car buying service will help you determine if the process is right for you. It could save you at least $3,000.

Auto Repairs Are EXPENSIVE


Some people love the car buying process. From watching commercials and taking notes on promotions to visiting dealership after dealership to test drive cars and trucks, it’s a fun experience from start to finish. 


For others, the mountains of paperwork and wasted time make it a headache.


Fun fact: people who hate buying new cars can outsource the task to a reliable and trustworthy third party, but is it worth it?


In many ways, it can be! If you don’t have the time to visit multiple car lots or hate negotiating with salespeople, using a car buying service may just be right up your alley. 


The service isn’t free, but if you have the funds available, it might be worth the time and energy saved.


The experts suggest that consumers at least look at online options before relying on a car buying service, however. Going in 100% unaware of the market could result in the purchaser getting taken for a ride.

What Types of Car Buying Services are Out There?

Buying a car doesn’t have to be a big deal; you can always rely on a car buying service,


There are three types of car services to help shoppers find the perfect vehicle:

  • Independent brokers
  • Clubs and membership services
  • Car concierge services

Independent Brokers

The car brokers handle every step of the process for you. They will do the research, looking for deals. They will also call up the dealerships to talk numbers. Whether they work one-on-one or with a giant agency, they’ll be able to save you time and maybe even money.


Whereas buying a car using a service isn’t usually free, it does help to have someone who is familiar with the process advocating on your behalf. Psychologically, because it isn’t their car (and they have loads of practice), the broker is not going to back down.


There are some pros to the situation. For example, brokers don’t charge high fees generally speaking. You have to be careful nonetheless. If somebody works as a broker, they may have a “special relationship” with the car dealerships. This could give them a bias.


To find brokers, look online. By reading reviews from past clients, you will have a solid understanding of what to expect in terms of quality.

Membership Benefit

Some memberships include car buying services. For example, a credit union could offer the benefit. Usually the service is virtual, but you will have access to the listings. They may just have a discount!


This can be pretty good considering you’re already a member or paying customer. It’s at least worth checking if you are curious.  On the downside, you still have to go and test drive the car and sign the contract.


Historically, these relationships have existed with Costco and AAA. 

Car Concierge

Finally, you could give a car concierge a try. It is the option that requires the least amount of work. When it’s all over, the car shows up at your front door, ready to ride.


The fees can be steep at first glance, but you are likely to make that money back in the negotiation process. 


These are professionals, though! They 100% know what they’re doing when it comes to saving carshoppers money. They make their profit by saving the clients cash that would normally funnel into the dealership’s pocketbook. 


Famous options include AuthorityAuto and CarBargains.

How Do Car Buying Services Work?

Learning how car buying services operate is an important first step in partaking in the experience.


For most, it’s the stress of buying a new car that makes them turn to a car buying service. The stress comes from the amount of time required to visit multiple locations, talk to various salespeople, and the high-pressure negotiation situation bound to ensue.


To forego the annoyance, those with the knowhow are turning to car buying services. If you’ve never heard of this, you may have questions like: What is a car buying service? How much does a car buying service cost? Is a car-buying service even worth it in the end?


As already covered, the first step is to see if you already belong to a club or company that offers car buying services. Consumer Reports, Costco, and AAA are all known for providing the service in some shape or form. Even Chase bank made a partnership with TrueCar.


For some, the service simply provides a well-negotiated catalogue that lists cars at great prices. It’s a service offered in exchange for membership fees and dues.


If you don’t have this benefit, you can always refer to a car concierge service like CarBargains. Another option on the menu is Authority Auto. The fees are higher, but so is the commitment level to customer service.


These buyers have plenty of experience to back up their claims, so you know they’ll be helping you save as much money as possible. In fact, they often have a bigger network at their disposal than the individual buyer would.


If you are going to go the car buying services route, you need to know a few factors to help the process get underway:

  • Budget: How much can you afford to spend on a car?
  • Geography: In what state will you be buying and driving the car?
  • Vehicle demands: Do you want a manual, automatic, four-wheel drive?
  • Features: Leather seats, seat warmers, and sunroofs… are they must-haves?
  • Technology: Do you want the latest in car radio technology?
  • Style: What brands and colors speak to your tastes?


If you go into the car buying service discussion with your list of non-negotiables, you will help the person charged with the task tremendously. If they have to go back to you with every little question, you will feel like you should have done the work yourself.

How Much is a Car Buying Service?

The price of using a car buying service is hard to nail down. In general, it costs at least $1000 to ask professional companies to take on the job. However, there are various fees posted along the way. For example, you might have to pay upfront and a percentage at signing.


If you’re using a membership program, maybe with a company like USAA, then you are realistically only paying for the membership fees. This can be a great value if the benefits are worth the fees in the first place. Depending on how you look at it, it could be “free.”


Some personal car concierge services charge the buyer a percentage of the money saved! You have to keep in mind that those are monies not being allocated to the dealership for the cost of the car. You’re spending money to save money.


Looking at the direct cost of the car buying service doesn’t make sense if you are actually saving money in the process. 


Then again, if it’s costing you more, and you don’t mind doing the work yourself, it may not be worth it. Some people feel like they must negotiate on their own. They live for the thrill of being able to nickel and dime a salesperson.

What are the Benefits to Using a Car Buying Service? 

The main benefit to using a car buying service is that drivers can save money on the total cost of a new or used vehicle. Everybody loves a good deal!


One report by Regions Bank mentions that some people have saved over $3,300 on using a car service to purchase a brand-new vehicle.


If you look at this from an economic perspective, you are likely saving more money than this. Think about it like this: how many hours would you spend in the process of buying a new car? How much money are those hours worth to you? Add that on to the savings.


If you make $20 dollars an hour, and you would spend forty hours researching, shopping for, and purchasing the new car, you could save $800 and a week’s worth of time!


The process isn’t without its drawbacks, though. When you use the service, you may not get the “real feel” of driving the vehicle before signing on the dotted line.


The sticker shock that occurs when initially researching car buying services makes it seem like a foul investment, but a little more mental math clears that up.


As stated, the experts highlight how a little independent research can pay off when going about the process of purchasing or financing a new or used vehicle. It’s important to be somewhat aware of the market, current MSRP rates, and the types of vehicles available.


Perhaps the biggest drawback is that some people find it hard to relinquish control of the situation to a stranger.


By making a plan, you should be able to capitalize on the car buying services endeavor without a hitch.

Case Study: Car Buying Services with AAA

There are plenty of car buying services out there. A simple Internet search turns up the big names. That being said, plenty of consumers wonder this: How does the AAA car buying program work?


The pre-negotiation is where the program begins. Car dealerships and auto makers work with the AAA team to offer special pricing on many types of new vehicles. Just schedule a meeting with the AAA representative to determine what “Dealer Contract” will help you profit on the deal.


This program does allow for test drivers, and you’re not under pressure to purchase just because you’ve taken the car for a spin.


Do you have to be a AAA member to enjoy the service? Yes.


If you’re not already a member, or not interested in becoming one, no sweat. There are alternatives available to consumers across the country.


This program is different from other car buying services that send the shoppers to lots to negotiate prices and test drive vehicles on your behalf. These types of car concierge services are more customized, connecting clients to their dream cars.

Is Using a Car Buying Service Worth It? The Bottom Line

At the end of the day, we all just want the best car for a great value, whether buying new, used, or salvage.


As the average price of a vehicle is on the rise, and the general lifespan of a car is only twelve years, the investment is a big one. However, if a person can save a few thousand dollars on a new vehicle by using a car buying service, why shouldn’t they?


Consumers will save time by avoiding the hassle of spending weeks visiting dealerships. Car shoppers won’t have to spend months taking notes on holiday promotions based on a slew of car commercials. 


On the other end of the spectrum, you can get rid of a car with similar services! The average lifespan of a car is about twelve years. When the car is ready to retire, you can call a one-stop-shop service to remove the vehicle from your property. It’s the local junkyard.


The local junkyard is like a reverse car buying service. It instead buys the car from you, offering you cash money on the spot. By pairing the car buying service to the junkyard service, you can save a lot of time and energy. If you hate hassles, both are worth it in the end!