Complete List of Dos and Don’ts on Car Buying Services

(Here's what you need to know)
Ryan Hanley headshot photo. Written by Ryan Hanley
Ryan Hanley headshot photo.
Written by Ryan Hanley

Ryan Hanley is a public speaker, podcaster and author of the Amazon best-seller, “Content Warfare.” Ryan has over 15 years of insurance expertise.

Piggy bank with a car key on top of money

Car buying services can save you money on the overall purchase price of a car, often for a flat fee or a percentage of the savings under the MSRP. According to Bankrate, “These companies usually hire auto-savvy professionals to find a vehicle on the consumer's behalf.” The best auto buying services have the potential to save you thousands on the cost of a car. 

But more importantly for some buyers, a car buying service can save you time – hours and even days. If that sounds appealing to you, you might be a great candidate for a car buying service. Let’s take a look at the major types of car buying services and the differences between them to find out which is the best car buying service for you. But first,  make sure you're covered with an affordable car insurance policy.

Club or Credit Union Auto Buying Service

Club- or bank-based buying services are the simplest level of car buying service. They save you time on researching vehicles, pricing the model you like and finding a reasonable trade-in value for your current car. These are usually free services provided to members of discount retail clubs, credit unions and auto clubs like AAA, Costco and the USAA for military families.

They pre-shop a variety of dealers and makes and often have a ready pool of car dealerships and zero-haggling prices at their disposal, usually well under MSRP. In addition, they may provide extra assurance that you’re getting as many discounts as possible. Costco, for example, ensures that you receive “all available national manufacturer incentives” that you might have missed by shopping on your own. 

Some services only offer information and location of the car you want, along with guaranteed pricing, while others offer the help of on-site staff ready to smooth the road for you when the time comes to make the purchase. In return for the increased sales volume, dealerships usually pay a fee to the car buying service.

What To Watch for:

  • If the service leaves it up to you to work out the details of the contract and sign at the dealership, make sure the dealer does not ruin your great deal by tacking on extra fees aside from taxes, licensing and registration. Many service providers keep staff on hand to work out pricing with dealerships, so feel free to call for help if you feel they are overcharging you after the fact.
  • You can often negotiate a lower price than the buying service can if you study carefully and fight hard or if you go with a more aggressive car buying service. But for simple convenience and zero up-front costs, your club or bank’s auto buying services may be all you need.

Car Buying Services for Hire

If you’re willing to put some cash on the table, you could save thousands over the club service's best price. Jessica L. Anderson reports for Kiplinger, “Clubs that offer group discounts and accept dealer fees may not land you the lowest price. The best prices often come from services that will do the haggling for you for a fee.” 

These car buying services can include small local providers who understand your city and know the dealers, but the biggest fish in the market today are web-based services such as CarBargains and Authority Auto.

CarBargains, for example, charges a set fee and then takes on the task of pitting local auto dealers against each other, asking them to undercut the next dealer’s bid on the price of the car you want. Once the price hits bottom, you get to sign and drive, sometimes at a cost thousands under invoice. Some of these service providers charge a percentage of the savings they net you, while others work for a predetermined fee based on the price of the car you like.

What To Watch for:

  • Money Talks News founder Stacy Johnson advises that you find out from the service exactly what happens if you don’t like the car after the fact or if you buy a lemon. Returning a car can be a nightmare without the right help.
  • Find out who is paying the buying service, besides you. Independent agencies like Authority Auto promise fewer conflicts of interest because they refuse to accept any compensation from dealerships.
  • You may be able to save money by negotiating the price of the car as low as you possibly can on your own and then bringing in a buying service at the last minute. Often an auto buying service will only charge a percentage of the savings under the price you negotiated or charge nothing at all if they can’t beat your deal. It can’t hurt to be sure you’re getting the best price you can possibly receive.

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Local Car Brokers

Most services that fly the brokerage banner are on the payrolls of the dealerships, but that doesn’t mean they can't help you. A broker can save you time and hassle by finding the car you want and working out a discounted price for you. A broker may even deliver the car and contract right to your door.

Much like the club car buying services, they usually have pricing worked out in advance with local dealerships and can sometimes get prices and discounts you might not be willing or able to work out on your own. But according to Edmunds, they may be limited to only a few dealerships, which shortens the list of available vehicles considerably. 

Car dealerships pay brokers for their services because they drive sales and bring in new clientele with a minimum of negotiation time.

What To Watch for:

  • Don’t pay for a car broker who also gets dealership compensation. If you are willing to put money into a car buying service, it is probably better to invest in someone who only has your best interests in mind.
  • Find out how much shopping range the car broker has. If the broker only works with a few nearby dealerships, you might be better off working with an online provider who can choose from a much larger assortment of vehicles.

Car Buying Concierge Services

If you’re looking for a luxury or rare collector car or even a lease, a car buying concierge can work miracles for you. Concierges offer the best car buying service options among car buying service providers. According to Kiplinger, in some cases, they will locate the car, negotiate the lowest price, get a good offer for your trade-in, drop off the trade-in, deliver the new car and even bring the paperwork for you to sign at your office or home.

With the right car buying concierge, you might get your new car without ever setting foot outside your home. Of course, these services come at a premium, but the savings and convenience they provide net you a wide margin of profit, in most cases.

What To Watch for:

  • As with anything else, shopping around can pay off. Pricing varies from one concierge service to another, as does the menu of services offered. Aim for the best balance of value and cost.
  • Beware of the dealership’s broker posing as a "concierge" service. The broker's willingness to drop off and pick up like a concierge service doesn’t mean the broker is looking out for your best interests like an independent concierge service would.

Before You Contact a Car Buying Service

You need to take a few steps before getting the help of an auto buying service. Financial adviser Stacy Johnson offers a few tips on how to prepare for a successful purchase:

  1. Know what you want. Do your research, whether online or on the car lot, to find out exactly which make and model interests you. Also, decide how much you care about extra features like leather seats, 4WD and paint color. Michael Koretzky reports from his own experience, “In my case, the broker said I would save both time and money if I didn’t care what color my Oldsmobile was. So I ended up with a red car, which was fine with me.”
  2. Always shop around for financing. The dealership can be the worst place to do this, but your current bank, credit union or insurer might have competitive rates available to you. This is one of the first things to take care of before you shop, and it definitely needs to be in your back pocket before you shake hands with the financing and insurance agent at a dealership.
  3. Consider selling your trade-in yourself. You can usually get hundreds or even thousands over the trade-in price by selling in local classified ads or even to a local used car dealer. If your time is tight, you might find a broker or concierge who can handle this for you.

Insurance Shopping Service

Many car owners don't know that they got a bum deal on their car insurance, because they only shopped a couple of insurance providers, or they stuck with the one their dad signed them up with when they first started driving. The best way to get a great deal on car insurance is to talk to an independent insurance agent, somebody who doesn't just work for some big insurance company.

Independent insurance agents are like insurance concierges. You tell them a little about who you are and what you need, and then they shop a wide range of insurance providers to find the best coverage at the best possible price. All you have to do is find one nearby and set up a time to chat. 

Agents in the Trusted Choice network are located in just about every ZIP code in the US. And a bonus: They stick with you, so if you have to file a claim, you've got a familiar face right there to advocate for you with the insurance company. Great deal.

Go Forth. Get Help and Savings and Glorious Free Time

Car buying services flew under the radar as an option for most car buyers in recent decades. But now this consumer service business is growing in popularity and visibility each year, as the Internet makes it easier to find and rate both car dealers and car buying service providers. This time, with a little research and a few phone calls, you might have the most laid-back car shopping experience of your life.

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