If buying a car for your teenager is uncharted territory, take a page from the playbook employed this summer by two of my kids.
Each bought a new car in July and each used different tactics to find the best deal for their money. My daughter worked with a car broker who worked the auctions, while my son found what he wanted through Costco.
Many parents avoid the car lots altogether in favor of negotiating with a neighbor down the street or with someone posting online.
But there are options you might not have thought about, including buying from a rental car fleet, tapping into group auto buying programs through retailers such as Costco or Sam’s Club, and scouring online with brick-and-mortar car auctions.
Keeping the coronavirus in mind, take precautions to make sure you’re safe in a vehicle that may have been touched by plenty of other shoppers.
Here are some pros and cons to other car-buying strategies:
Who is one of the top sellers of vehicles in the U.S.? Try Costco.
The company connects members with a network of participating dealerships that offer money-saving deals on new and used vehicles. About 3,000 dealerships are in Costco’s program.
Sam’s Club, AAA and others also offer auto buying services as a perk to members. They all work essentially the same way, with online tools to streamline the shopping process. The key advantage — these services take the haggling out of the equation.
With Costco, for example, members plug their preferred new or used vehicle into the CostcoAuto.com directory, including make, model and model year, and local participating dealers come back with offers. Costco says members save an average of $1,000 on a typical transaction.
If buying used, those cars must have undergone a thorough inspection, with necessary repairs.
Downsides? Membership comes at a price, though not steep: $60 at Costco, and $45 at Sam’s Club, for example. The dealers with the best deals may not be the most convenient, and keep in mind you will only see cars offered by participating dealers —in other words, not all the cars that fit your criteria.
With Hertz trying to sell thousands of cars at huge discounts, now might be a good time to kick the tires at rental car companies.
Pay attention to the number of miles on a vehicle. Experts say aim for a car with no more than 15,000 miles. Where those miles occur is key; rental cars are often driven on long trips over highways. It makes sense — driving on smoother highways generally means much less wear and tear than stop-and-go city traffic.
While online auctions will sometimes turn up sweet deals, experts recommend shopping at brick-and-mortar auctions in your area. According to NerdWallet, vehicles usually sell for trade-in value which can be much cheaper than the sticker price at a dealership.
Some auctions are strictly for brokers who are affiliated with dealerships. Brokers, however, build their fee into the price, plus there could be shipping costs if the vehicle is coming from afar.
An alternative: Look for public auctions that don’t require a dealer license. In some cases, you may have to pay a fee to bid.
Experts recommend observing the action several times to get a grasp of the rapid-fire process. If you’re friends with an auto mechanic or a car buff, invite them along.
But beware, you may not get much time to inspect the vehicle you’re interested in, and if you are successful, a deposit is required on the spot and full payment is generally due in 24 hours.
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