During the past 15 years, the Internet has significantly changed the car buying process, giving shoppers an invaluable tool to find the car they’re looking for at a fair price.1
For car dealers, this shift in consumer habits has produced the need to list more of their inventory online. According to the NIADA (National Independent Automobile Dealers Association), over 82% of dealerships maintain a website and many publish their best price for inventory online - giving online car shoppers an opportunity to easily compare prices between dealerships. To compare vehicles at multiple dealerships, many online shoppers use sites like cars.com and autotrader.com, which aggregate information published on dealer sites and provide popular comparison engines.2
With shoppers moving more and more to the Internet to shop for vehicles, the numbers of online vehicle listings have steadily increased. In 2013, the number of cars listed online reached 47 million, up from 38 million in 2011. Similarly, the number of cars sold online has also been climbing, with 15 million vehicles sold online in 2013 compared to 10 million in 2011.3
There are a number of differences between car shopping online and in-person, and if you’re purchasing a vehicle online, it’s in your best interest as a buyer to be aware of them.
The pros of car shopping online often outweigh the cons
Formerly, to find a car for sale you’d have to look in the classified section of a local newspaper or go to a dealership, but with more dealers and private sellers listing vehicles on the Internet, it takes just a few clicks to search for the vehicles available in your area. That said, like many online shopping experiences, it’s easy to become overwhelmed by the sheer volume of options you’ll find when using car shopping websites. Most automobile websites have several ways of filtering search results, which can allow you to pinpoint your desired vehicle based on manufacturer, model, color, mileage, price, features and more. In addition, some other advantages of shopping for cars online include:
- Larger selection
- Easier price comparison
- Usually no pressure to buy
Tips for safely buying a car online
When you’ve picked out the car and contacted the dealership, you want to make sure that you’ve diligently performed all of your research in advance of the purchase. Here are some tips for avoiding pitfalls during a sale:
- Get the VIN (vehicle identification number).
- Look up the vehicle history report.
- Ask the dealership or seller if the title is clean.
- Know that you will need a notary present to transfer the title during a private sale, and you will also need to pay applicable state and local taxes, so you should factor that into your financing.
A word about private car sales online
While dealerships make up the majority of online vehicle listings, private sellers also frequently list vehicles online for sale. While buying from a private seller can be a great way to save money on a vehicle purchase, there are several ways that private auto sales differ from buying a car from a dealership. In particular, you should be aware of the following when car shopping online:
- If you’re purchasing from a private seller, consider getting a mechanic to look over the car. Private sellers are not under the same obligations as a dealership for delivering quality goods, and most private auto sales are delivered “as-is.”
- Know that you will need a notary present to transfer the title during a private sale, and you will also need to pay applicable state and local taxes, so you should factor that into your financing. You may want to complete the title transfer at the BMV/DMV with the seller present.
- If a seller has not paid off his vehicle in full, he will need to obtain a release from his lender on his vehicle loan, which may involve transferring the auto loan to another lender.
- You will need to immediately register your car purchase with your local BMV/DMV.
Car shopping online is an easy and fast way to see what options are out there, and if you do your homework before you go to buy, you'll put yourself in a great position to get a great deal on the car that you want.