ALT-1 Tips for using an Internet Based Car Dealer
I used CarsDirect to purchase my 2004 Toyota Corolla. I did all the research for the car online and used my friend's Corolla which she bought a month ago as a test drive.
I went to the local dealer but they wouldn't allow it without a copy of my driver's license. I found out that some dealers check credit while your taking a test drive. This can reduce your credit score if you don't purchase from them.
My suggestion is to look in the ads for a slightly used one that has the same body style and test drive that from a private seller. Of course check with your relatives and friends first to see if anyone or anyone they know has one.
So I was 100 % sure of what I wanted. Then I checked out different ways to purchase a car online. I tried e-mailing dealers and using other car-buying services but they couldn't match carsdirect's price.
I decided to go with Carsdirect but to find out as much info as possible. I clicked on all of their links and read as much as I could. Then I used their online chat to find out the stuff I didn't know. I wasn't clear how the process worked.
The online chat is kind of weird because it scrolls down instead of up like normal chats. I learned that some deposit had to be put down. This wasn't mentioned at all in the site. I was trying to find out about financing and was getting conflicting information about that.
One chatter said I couldn't use Capital One because they use them. Then when I called on the phone they said I could use any financing available to me. Capital One had the cheapest APR if you used them directly. I believe it was 3.6%. If you go with Carsdirect it would be 4.99% if you have good credit. I decided to just go with the Carsdirect financing because things may be smoother and faster. I could always refinance later.
When I called on the phone there was again conflicting information. One person said you must pay the car before you see it. Another one said you must pay the car when you see it. I called after their normal business hours and I felt like I was talking to some college kids. I don't recommend you call after normal business hours as you may not get accurate information. Some of the people I talked to seemed rude also. Not professional at all. I wasn't inspired to buy a car online.
After much wrangling I decided to just go ahead and order the car. What the hell I thought, it's just an order, and I didn't give them any money. Ordering is very easy. Pick your car model and all of the options and then fill in the contact information. Also fill out how you will pay. I though this is the point where they will ask for a deposit but no. It justs asks whether you will pay by cash, loan, or lease. I went with a loan.
I don't recommend leases unless you really understand them. It's very easy to get cheated. For example how to convert the least to an actual percentage. I believe you multiply by 2400.
After the ordering I waited and sure enough the next day, one of their reps called me. I believe I also received some confirmation e-mails before that point also. They call them vehicle specialists. He was very professional. He explained how it all worked. The deposit varied from $250 to $2000. It depened on your model and state. I was told form my corolla it would be just$250. I think this number could be bargained.
My advice is when they tell you the number for your deposit, pause and then say that's too expensive. They may bring the number down to 250. Once you make the deposit your committed. You must buy the car unless their is a problem with the car. If you see a minor problem you can reject the car but they recommend you work with the dealer of course to try to resolve things. Also the money is non-refundable unless their is a problem with the car. I asked if it would go to the price of the car and he said yes. Something different happened later though(more on that later.)
He also said that the cars must come from their dealer networks. I found out later they I had to drive 80 miles to my dealer. More about this later. Also if a dealer doesn't have the car and they have to go out of network the do something called a dealer trade. One dealer will trade a car with another one that is similar in body but may have a different color to meet your preferences. He didn't tell me that they will charge $150 for this. I found that out later. I think they will go through a speech like this with you to inspire confidence. This is what is necessary to buy a car online. He told me he was a GM specialist and the Toyota specialist wasn't in. I found him to be professional and said I wished he was my specialist. He talked to some of the managers and did just that. May advice is to try to find someone who you are comfortable with. If you don't like your spec., ask for another and see if you click with him or her.
He verified the car and the options with me. It was exactly as I ordered. Then he asked me for a credit card for a deposit. This is the no going back point. My advice is to tell the spec. that you want to think it over just a little more. Maybe an hour or so and then to call back. This will give you one final chance to see if really want to go through with this. I gave my cc number and he said he would call back to find the vehicle.He called back later the same day and said he found it but a dealer trade would be involved and this might cause a days delay. I ordered on Wednesday, he called me and found the car Thursday, and said I should be able to pick it up Friday. He also said my financing came through at 4.99 %.
My advice regarding the financing is to go with your own if you can find better. Just remember that this may cause additional delays of a few days faxing things back and forth. It may even cause problems if things aren't right. That's why I just went with their financing. Faster and smoother.
On Friday he told me the deal couldn't be done because he normally doesn't work with Toyotas and didn't have rapport with the dealer. So he had to give the check before they could trade. So I would have to pick it up on Mondays. I said what about the weekends and he said they don't do weekends. This is also something to keep in mind. Your business will probably be done on a weekday and you will have to take time off of work to get your car.
Monday comes and I'm ready to go but don't have the dealer contact info. I'm frantically trying to reach them and get nothing. I know I have to go far and need the information. My advice is to get as much information as early as possible. Be careful of them talking about their family. It's suppose to generate sympathy on your part and put your guard down.After he found the car he e-mailed me the final pricing. $50 documentation fee, $150 dealer trade, taxes, and I added lojack and gap insurance. He was also pushing the extended warranty heavily. Be aware of this and say no. You should compare all the warranty out there before you say yes. This is a real profit area for them and they will push it heavily. Close your ears and then say no to them. Also on my bill I was supposed to get a $75 dollar discount but instead of subtracting it was added. He said honest mistake but I became suspicious. My advice is to never let your guard down no matter how much you think you trust them. Check and double-check all the numbers to the penny.
Also the price he gave me for the car including options was one dollar higher than what I saw on the website. He said it was a system error. I think he was checking to see if I was awake. I snoozed on that and then he tried to do the double $75 trick. Make sure all of your numbers are right and beware of all of the tricks dealers play. They may use the same tricks on you.Also my monthly loan payment was 75 cents higher than it should be. He said they used a different formula but I suspect someone is padding the interest. It may not be carsdirect, it may be the bank. Check the numbers using an online auto loan calculator or even talk to your own bank rep to find out how they calculate it.
Back to Monday, I had to drive my car which i was going to trade in to the dealer which was located 80 miles away. My car had no AC and it was 85 degrees out there. My advice is to also think about the transportation cost to get to the dealer. If you are going to trade your car in, you will get the lowest value or no value at all since the dealer is knowing you got a great price on the car. I advise you to do a trade-in if you car doesn't have any value. My car was worth about $300 and I got $5 for it.
Once at the dealership I looked at and tested the car. Because I drove so far, there is an inherent pressure to buy it. You've invested so much energy into the car you will overlook minor flaws just to purchase it. Something to keep in mind. My car did have an slight alignment problem but was repaired for free at a local Toyota dealer.My car when I tested it had 80 miles on it. Since I put so much time into it I decided not to make a big stink about it.
If you are in a rush to buy a car don't use Carsdirect. If you are very pick about your car don't use Carsdirect. You you want' your car to be as close to 0 as possible on the odometer don't use Carsdirect.
So if you want to purchase from Carsdirect keep these things in mind: 1 You will have to go on weekday and may have to sacrifice a personal day or even your salary for that day, 2 Only trade-in your car if it has no or low value because the dealer will probably try to make-up the normal profit through your trade-in and won't give you much, 3 How will you get there and the cost to get there and the distance may be quite far, mine was 80 miles if your not going to use a trade in. 4 If something is wrong with your car, even a minor issue, do you have the nerve to back out of a deal you may have spent a week putting into and driving so far to? 5 Add $150 dollar dealer trade fee, $50 dollar doc fee.
If you want to keep dealership haggling to a minimum use Car's direct. If you want the lowest price use cars direct. Remember the dealer trade fee, doc fee, and the pressure to buy your car since you put so much time into it. I'm not sure if I would use Cars direct again. I did save at least $2000 dollars and have a beautiful car. It's worth it if you have the time and energy.
