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10 Things To Know Before Buying A Car Online

Shopping for a car is a very unique process. Not only is it exciting, but it is also complicated, expensive, and daunting. Before the advance of the Internet and the widespread use of online shopping, car shopping was done in person. You would have gone to the nearest car dealer. You would have browsed a small lot of cars parked by the side of a road. Following this, you would have talked with the owner or salesman and relied on their expertise to help you decide. Today, you can buy a car at the touch of your fingertips.

With the increase in online shopping, you can now buy automobiles online, and here are ten things you need to know to make an informed decision.

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10 Do Research

Do your research. No two cars are alike. Each automobile serves a different purpose and possesses different features than another. When conducting your research, ask yourself these questions. Will it be new or used? If you choose to buy a new car, many dealerships and companies such as Tesla offer their own websites that allow you to customize your new ride. 

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If you choose to buy a used car, there are websites such as CarFax, and even local sellers you can find on Craigslist. Be sure to keep in mind other questions as well, such as what type of car will fit my lifestyle? What operating costs am I willing to pay?

9 Beware of the “Too Good to be True” Price Scam

Before heading into the shopping phase, beware of the “too good to be true” scam. Typically, vintage cars will be listed online for an unusually low price to pique a buyers’ interest. Once someone contacts the seller, they explain that the car is out of the country. 

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The seller then convinces the buyer to buy the car, upon which they will arrange for shipment of the vehicle. More often than not, once the transfer of funds is complete, the seller breaks the contract, and the buyer is left with a gaping hole in their bank account. Avoid this scam by shopping on reliable websites and vetting your seller.

8 Guard Yourself

The best way to avoid online scams and to be safe when shopping online is to avoid certain behaviors. For starters, never wire money or engage in a bank-to-bank transaction. It is much safer to use an escrow service online. 

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In doing so, your funds will be transferred to the service and eventually to the buyer once the purchase is complete. This ensures both sides will have peace of mind, and the safety of your transaction is guaranteed. Also, beware of sellers who want to complete a transaction as soon as possible. Call the seller to double-check the details you may have discussed or even agreed upon in the past, and finally, trust your gut.

7 Shop Around on Reliable Websites

There are hundreds of car-selling websites out there. While there are more than two reputable sellers on the Internet, here are the two best sites to shop on. If you choose to go another way, however, be sure to avoid scams and look into the company.

Carvana and Vroom are reputable companies to use. They both offer photos, descriptions, a dealer warranty, trade-in options, and a 7-day return policy. Carvana provides a Carfax report so you know the car’s history, but the prices are non-negotiable.

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Vroom cars undergo multiple inspections and have clean titles. They provide complimentary roadside assistance for one year and AutoCheck report on the car. A $499 delivery fee is not included in the price of the car.

6 Virtual Test Drive

When buying a car online, you could be looking at a car halfway across the country or down the street. If the former option describes you, you may not always get a chance to test-drive your vehicle before purchasing it. 

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If you have an Android phone and a VR headset, just download the RelayCars app, and you are good to go. This app offers 3-dimensional views of the interiors of countless cars, and also offers you the opportunity to ‘test drive’ it. Although in no way the real deal, the virtual experience offers you a glimpse into how your car looks and drives and is better than nothing.

5 Vet Your Sellers

While this one mostly refers to sellers on Craigslist or Facebook Marketplace, there is no reason to limit it to just that. Even if you buy from Carvana or Vroom, don’t forget to vet them. When communicating with a seller online keep in mind that if the seller changes their story or goes back on terms you have discussed in the past, it is often a good indicator that you are dealing with a scammer.

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While shopping with a certified dealer online helps put your mind to rest, using a service such as Craigslist may not. Instead, use Facebook Marketplace. This is an excellent choice for buyers as you can vet the seller before even looking at the car. As far as third-party platforms go, Facebook Marketplace is the safest.

4 Look at Car Histories

When buying any used car, it is vital to check its history. If buying from Craigslist or Facebook, do not skip this step. Always run a car’s title on the DMV website to check if it is clean, clear, or salvaged. It is also recommended that you run your own Carfax report if one is not provided to you.

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Next, research the history of similar car sales. Find out what other people paid for the same car. One excellent service to use for this is TrueCar. Don’t skip on using this tool and beware of dealers who will barrage you once you sign up to use this website.

3 Double-check How the Delivery Will Work

While it may sound like an obvious statement, please remember to check how the delivery will work. Carvana, for example, will deliver to your driveway or if you live in Atlanta, will dispense your car from a vending machine. Vroom too, delivers to the lower 48, but beware of additional delivery fees.

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Also, it wouldn’t hurt if you kept yourself informed on warranty information, return policies, and roadside assistance services. Some dealers offer all of the above, some offer none. If buying through a peer-to-peer service, chances are you missed out on the warranty but negotiate a return policy with the buyer. There is always the slight possibility that you may hate your new ride.

2 Find a Legitimate Escrow Service

Finally, we are at the final stages of this tedious process. Assuming you followed all steps, found a car, and agreed to buy it, proceed to find an escrow service.

As I mentioned briefly above, there are other ways to transfer funds such as bank-to-bank or wire transfers, but escrow is by far the safest. To keep it simple, escrow works in five steps.

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  1. Buyer and seller agree on terms
  2. Buyer pays escrow service
  3. Car exchanges hands
  4. Buyer marks transfer as complete
  5. Escrow service pays the seller

Keep in mind there are other choices than escrow, but this method is the safest and most reliable.

1 Arrange for the Transfer of Funds

Finally, the transfer of funds. Assuming you chose to use an escrow service, just create an account and draft an agreement for you and the buyer. Once this is done, transfer the funds to the escrow service, which will hold it in a secure account. Once you receive your new car, indicate the transfer as complete on the escrow website. Upon this, the funds will be transferred to the seller while the service maintains a small transaction fee.

Congratulations! You have made it through this adventure. You are now the owner of a new (or used) car! Just remember, be safe and have fun.

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