I Bought a Used Car Online During the Pandemic — and I May Never Go to a Dealership Again
Right before the coronavirus pandemic, my car — an oldie but a goodie — was parked on the street in front of my house. A driver smashed into it, totaled it, and careened into my fence, taking that out, too. 2020, amIright?
I suddenly was in the market for a new car, but COVID-19 was spreading across the United States, complicating matters. I scheduled test drives at local dealerships. But the thought of touching all kinds of surfaces — door handles, steering wheels, blinkers, gear selectors, consoles — prompted me to cancel those dealership appointments.
I was stalled.
So, I turned to the good ol’ internet and bought a used car from Carvana, sight unseen. A few days later, my 2017 Jeep Patriot with less than 35,000 miles arrived on a delivery truck at my house (though I’m slightly envious of those who go the novel “vending machine” route with Carvana). Here’s what I took away from the online car shopping experience, plus some tips from experts in case you’re considering going this route, too.
You can change your mind — but the clock is ticking.
When I was browsing available cars, a zoom tool let me zero in on any marked imperfections. When my car showed up, I was surprised the scratches I had seen denoted on the vehicle were much less visible than I expected. (We’re talking about a 1/2-inch pen mark on the interior roof of the car that I’d never notice if it hadn’t been disclosed).
On the delivery day, I showed the delivery driver my license and proof of insurance, then took the Jeep for a quick solo test drive around my neighborhood. It had that quintessential new car smell, with top notes of alcohol-based sanitization. I signed the title and registration paperwork and then had seven days to decide if I wanted to keep the car. Spoiler alert: I did!
LeeAnn Shattuck, an automotive expert, race car driver, and personal car shopper with The Car Chick, typically recommends buying a used car with a pre-purchase inspection. With online-only car dealerships, you’ll want to get your car inspected by a certified, independent mechanic before the return window closes, she says. Request the entire Carfax report so you can know the history of the vehicle, she recommends.
Also, if you’re planning to buy online, ask about limited warranties and understand what exactly they cover. Mine came with one that’s good for 100 days, or 4,189 miles, and my online Carvana dashboard tells me how much time I have remaining. I also purchased a two-year CarvanaCare program that provides similar coverage to a manufacturer warranty, and covers issues with the engine, transmission, stereo, air conditioning, and other parts with a $50 deductible.
You don’t negotiate on prices.
My past car-buying experiences have been all-day affairs, complete with the drama of walking away from the lot only to have the salesperson chase after me.
Carvana doesn’t negotiate on prices. I tried. It was a natural reflex! But I realized not negotiating made things less stressful for me. The price I paid for my vehicle was on par with the Kelley Blue Book values.
“Buying a car online can absolutely simplify the car-buying process and save you hours of precious time, but it doesn’t automatically mean you’re going to get a good deal,” cautions Matt Frankel, a certified financial planner and writer at personal finance site The Ascent. “It’s still important to do your homework.”
He recommends looking at websites like TrueCar to tell you what other buyers actually paid for a particular vehicle and by browsing listings. That way, you’ll get a good idea of how much you should be paying for the car you want.
Figure out your financing in advance.
Before you start shopping for your car, research your financing options, Frankel recommends.
Not only will this give you a firm idea of how much you can afford to spend and what your monthly payments will be, but it will also give you a basis for comparison when you’re applying through the dealership or marketplace you’re shopping on, he says. In my case, the interest rate on a loan I was able to get through Carvana was slightly more competitive than what my credit union was able to offer.
You can also refinance your car down the line if your credit score increases or a better rate becomes available.
“It makes the most sense to try to refinance your loan in the first year of having it after you’ve made a few on-time payments,” says Amy Wang, the associate director of Credit Karma Auto. “This way, you maximize the benefit of a lower rate when you have many payments remaining.”
While you can still refinance towards the end of your loan, you likely won’t get as much in savings because you have fewer months left to benefit, Wang says.
“Also, some lenders require you to have a certain number of payments left on your auto loan in order for them to refinance — the effort has to be worthwhile for them, too,” she says.
If you want to refinance your auto loan, the first step is to call your existing bank or credit union to see what they can offer, or compare options from a broader range of institutions on platforms like Credit Karma to compare rates and terms.
I’m hesitant to buy jeans online because I can’t try them on first. So, making a pricey purchase like a car online was definitely out of my comfort zone. But in my years of car shopping (I’ve purchased four from dealerships!), my online experience has by far been the smoothest. It took two hours total, and that included getting all of my self-employed documentation to the financing department for review. Plus, Carvana took care of the registration so I don’t have to make a trip to the DMV, which is another victory in my book.