How to Buy a Car Online in 9 Steps

The internet is driving radical changes in the car buying process, and this is transforming the world around car dealerships. Today's purchasers and lessees can visit hundreds of dealers without ever leaving their homes. 

This can be especially useful if it’s your first time buying a car as it takes away a lot of the pressures of negotiating with salespeople. 

This also eliminates the need for you to spend days going from dealer to dealer in search of the car, truck, or SUV you want.

Let’s explore the process of buying a car online.

Buying a car online certainly has its advantages, especially if you’re someone who doesn’t like to haggle, or maybe you’re busy. 

Below are some key advantages:

• More options - Purchasing a car from an online dealership will provide you with a lot of options whether you're looking for one in a certain color or one with incredibly unique accessories or features. Also, it makes it simple for you to purchase a vehicle from outside your local area.

• No need to negotiate - Not everyone enjoys going into a dealership and negotiating with car salespeople. Some would prefer to avoid the aggressive negotiation and high-pressure sales techniques that frequent car buying. Instead, you may shop and purchase a car online in the comfort of your own home, on your schedule, and without any pressure.

It’s not all advantages. For example, you will have to pay the price listed with no chance of negotiating. Below are some disadvantages:

• No chance to inspect - When you purchase a car directly from a dealership, you have the chance to inspect it thoroughly and test drive it to ensure that it meets your needs. You lack that capability when purchasing a car from an online dealer. Instead, you need to do your research and read reviews to ensure the car is right for you.

• Stuck with the price - Some people may find the lack of negotiating a plus, but for others, it means you’re stuck with the price you see online. There is no wiggle room for haggling, so you miss out on any deals the dealership is willing to offer. So overall, you are likely to spend more money if you buy a car online.

Although it may seem strenuous, buying a car online actually takes a lot of the hassle out of the process. Below are some tips and tricks you should adopt:

How to buy a car online: At a glance

• Pick a budget
• Research a car
• Get financing for the vehicle
• Shop around
• Contact a dealership
• Negotiate the price
• Inquire about trade-in value
• Conclude the purchase

1. Budget

Start by setting a budget. You shouldn't consider your budget for a car as a monthly payment. Instead, think about the overall cost of the vehicle, which includes the entire amount of interest you'll pay throughout your loan.

Don’t forget to also take into account all of the additional expenses associated with operating a car or truck, such as fuel, insurance, maintenance, and parking. 

You’ll also need to make sure you are credit-worthy and able to finance or purchase a car, as the deal will check for this. Usually, you are required to have a credit score of at least 700 to qualify for financing or an auto loan.

2. Research

The car market is awash with excellent vehicles – you just need to know how to find them. Spend some time looking at makes and models and find which best fits your needs. 

You might not always find everything on your list of requirements, but the more you know, the better. This also helps with a later stage – the negotiation. Knowing the car's worth and detailed information can help you haggle for a better price.

3. Finance

Savvy buyers are aware that they should never contact a nearby dealership – in person or online – without first having their financing preapproved.

Obtaining a pre-approved loan not only aids you in establishing a suitable price range, but it also provides dealers with a benchmark offer they must surpass if they want to be the ones to handle your new or used car's finance.

An online pre-approval for loans is simple to obtain. You can compare offers from banks, credit unions, and other lenders in person or online, using a single application to request quotes from several different lenders. 

4. Shop around

Once you’ve sorted out all the boring paperwork and important finance documents – it’s time to hunt for your desired car! You may already have an idea of what brand and model you need, plus if you require any add-ons. 

The perk of buying online is that you aren’t limited to whatever your local dealer has in stock. You can browse websites like Autotrader for second-hand bargains, or look for dealers further away than usual.

5. Contact some dealerships

Previously, to view the inventory on dealers' lots, you had to get in your car and travel from dealership to dealership. Customers may now browse dealership inventories of both new and used vehicles online from all over the world. 

Even if they don't have the precise model you're interested in stock, you should always speak with a local dealer before buying a new vehicle or truck. Dealers frequently trade stock with other dealers when customers demand particular models, colors, or features. One might be arriving in a forthcoming delivery.

6. Negotiate the price

Although you won’t get the thrill of an in-person negotiation (for better or worse) you may still be able to negotiate the price online. If you are someone who dreads the idea of going toe-to-toe with a salesperson, then this is hugely beneficial. 

If you’ve done all your research, you should have a good idea of what the vehicle you desire is worth – this leaves you in a great position to negotiate.

It’s worth telling the dealer if you have found a better price online for the same brand or model, then you can see if they can match the price or throw in some useful incentives to sweeten the deal.

7. Trade in your old vehicle

If you currently own your vehicle, it might be worth asking your dealer about its trade-in value, as this cost is then taken off the overall price of a car.

It might be worth contacting multiple dealers and looking on websites like Autotrader to get a real understanding of what your car is worth. You can then use this knowledge when speaking to a dealership to make sure you get a fair price.

8. Take it for a drive

Not all cars are flawless right out of the factory, so it is advisable to take the exact vehicle you are buying for a test drive before you sign any paperwork.

Although it's not a requirement if you're buying a certified used car, used vehicles should be properly inspected by a professional technician. There are more and more dealerships and automakers with programs that allow salespeople to deliver vehicles to your house for test drives. 

Having a test drive at your house gives you a great chance to use the vehicle on the highways you frequently use. You might need to go to a dealer for this step since not all automakers allow test drives at home.

9. Complete the purchase

For the most part, the sale still needs to be completed in person at the dealership. With a predetermined out-the-door sales price that includes all fees and taxes and financing through either your preapproved auto loan offer or the dealership's finance department, you should have a practically full deal in your possession as a result of your online talks.

Your trade-in will require a final appraisal from the dealership. Don't automatically withdraw it from the agreement and decide to sell it yourself even if the price is less than you believe it is worth. 

Verify the paperwork is in line with the agreement you made online and that there are no blank places. Even if you are informed that the paperwork will be updated later, never sign anything insufficient or inaccurate. Before you sign the document, it is simple to make changes; but, once you sign it, it is much more difficult.

The dealer will probably try to make multiple add-on product sales while you are completing the paperwork, such as extended warranties, protection items, or gap insurance. It's crucial to examine both the goods and the company producing any pricey add-ons before you buy them. 

One of the most common alternatives to buying a car is leasing. When you lease a car, you pay a monthly fee to use it for a set period. Although lengthier leases are available, the standard is 24 or 36 months.

There are limitations on how far you can drive and whatever changes you can make to it, and various fees may be charged.

You have the choice to return the car to the dealer at the conclusion of your lease period or to buy it for a predetermined price as specified in the lease contract.

Introducing FINN - a car subscription service

There is also another alternative to get your hands on the latest cars – that follows a subscription model.

At FINN, we want to take away the hassle of getting a new vehicle, so we’ve streamlined the process.

It’s simple. Just select the car you want from our ever-growing list of new vehicles, and provide us with some basic details so that we can run a quick credit check (this won’t affect your credit score.)

If approved, arrange for your car to be delivered completely free. There are no hidden upfront costs or down payments – instead, you just make a simple monthly payment that covers the cost of the car, insurance, and maintenance.

It may seem like a daunting task, but buying a car online isn’t as stressful as it might seem.

Be sure to have all your finances and budgeting in order before proceeding with any new purchase, and don’t be afraid to shop around. Dealers have quotas they must meet to hit sales targets, so the price you see may not be the final cost – there’s always some wiggle room for negotiation.