Used Car Brokers
The use of used car brokers
is on the rise. The concept
behind hiring an auto broker
is simple: you're not a
professional used car buyer,
so why go up against a
professional car seller
alone? With the confusion of
financing, fees, add-ons,
taxes and the hurried nature
of the dealership, it only
makes sense to leave the
bargaining to someone else.
A broker is likely to save
you money, but more
importantly, they provide a
peace of mind. For this
growing number of consumers
who lack the time, patience
or confidence, the used car
broker industry has emerged
throughout the nation and is
growing every year.
Benefits of a Broker
For a car buying expert to
help negotiate the best used
car deal is a great
advantage. Used car buying
can be very intimidating and
troublesome for many
consumers. When using a
broker, they can do much of
the work online, or over the
phone. You let the broker
know what type of used car
to look for, what colors you
prefer, optional equipment,
and what your price range
is. The Broker can also deal
with the financing and
trade-in aspects too. They
have access to information
such as invoice pricing, and
availability of incentives
that may not be listed
publicly, and the average
price other buyers are
paying in their area. Buying
a used car the proper way,
with research and
comparisons is very time
consuming. For those that
don’t have the extra time, a
broker comes in handy.
Brokers usually have
experience with dealerships
and know exactly how much
they can afford to charge
based on how long the car
has been on the lot, how
many more they have coming
in and other dealerships are
charging. In the end, most
consumers can save hundreds
if not thousands of dollars
by hiring a professional to
broker the purchase of their
next used car. But beyond
the dollars, you're also
saving hours of hassle in
avoiding the traditional
dealership experience. And
that can be the most
valuable benefit of all.
Downsides of a Broker
As convenient as a used car
broker is, there are many
car brokers that take
advantage of their clients
because their commission was
not disclosed. Some brokers
are certainly out there to
help people in the used car
buying process, but some are
just in it for the money.
So, like any deal, a little
research on the broker is
very important. Do not be
scared to use a broker, but
just be aware that just
because your broker is
saying it's a great deal
doesn't mean that it is.
Brokers also charge a fee,
depending on a number of
factors, so you must take
this into account when
thinking about the overall
price spent on the used car.
Broker’s Fee
Fee sometime depend on the
price of the used car you
are buying. Fees for these
services can start at $200
and can go as high as
$1,000. Used cars and rare
cars tend to carry a higher
fee since it takes more
legwork to locate a good
deal. The best broker deals
are charged on a flat-fee
basis, agreed to before
purchase. This way, the
broker only makes money when
they get a deal for you, and
they are not motivated to
purchase a more expensive
vehicle for you. An
alternative to spending
broker fees on a used car is
to go through wholesale
clubs like Costco and auto
clubs like AAA. They offer
car-buying services similar
to what brokers offer. This
isn't a true brokerage
arrangement; but the service
does take much of the
haggling out of the
car-buying process.
What to Look For
It is very important to
figure out what kind of auto
broker you're dealing with.
A look through the phonebook
or Internet can come up with
dozens of names. Not every
used car broker is really
working for the consumer, so
research is very important.
A great way to choose a
broker is to get references
from friends or family that
has used one. An opinion
from a first hand experience
is priceless. You do not
need to necessarily find a
local broker, as many have
started working from
Web-based traffic and taking
on clients around the world
for used car sales. Brokers
should not be receiving any
compensation from
dealerships; many operations
call themselves brokerages,
but make substantial amounts
of their profits from
dealerships, or even
directly work for a
dealership. This isn't
illegal, but can lead you to
question their interests.
Interview the broker; get
their background, the
history of the company, and
their fees. Also, make sure
the broker is licensed to
legally sell cars in your
state.
When buying a used car,
people often make the
mistake of impulse
decisions. Under the
excitement of a new car and
the urge to want something
out of their price range,
consumers do not always stay
within their budget. This
often leads to regret in the
long run, as they are
consumed by bills. A used
car broker can take the
impulse out of buying. They
will also save time, money,
and the frustration that go
along with negotiating for a
vehicle. Although there is a
fee, it is well worth it to
many used car customers.