Best Way to Buy a Car: Dealer vs. Broker vs. Private Seller

When most people think about buying a car, a dealership is the first thing that pops into their mind. The rise of online tools like Navy Federal’s Car Buying Service, powered by TrueCar®, ^{Footnote 1} allow you to shop for your next car online and see upfront offers before you go to the dealership. If you’re exploring other car-buying options, consider buying from a broker or buying directly from a private seller. Each option comes with unique considerations.

Buying a car from a dealership

The average car dealership sells both new and used vehicles, and they’ve been the traditional option for buyers since the invention of the automobile.

When you buy from a dealership, you have access to a wide selection of vehicles, and you’ll be greeted by a salesperson who can help you navigate the process. While this can be helpful, it can also come with unwanted challenges. The dealership may not have the exact make and model you want, or the salesperson might be more aggressive than you appreciate.

When it comes to financial considerations, dealerships typically offer financing options and warranties to give you peace of mind about your vehicle purchase. Dealerships can also be a helpful option if you already have a car, since they accept trade-ins for cash value. The downside of buying from a dealership? The potential for higher prices and the need to negotiate.

• Why choose a dealership?

If you feel more comfortable buying a car in person, from a sales team who can walk you through every step of the purchase process, a dealership can give you peace of mind. You’ll also have a single point of contact for all your car ownership needs.

Buying a car from a broker

The idea of a car broker is something many prospective vehicle buyers aren’t familiar with. Brokers are independent car buyers who assist clients in finding and purchasing cars. They may partner with one or more dealerships or work independently, acting as a connection point between private buyers and sellers.

Brokers can be especially helpful for buyers who are looking for a specific make or model. They check different networks and buying channels to find exactly what you’re looking for and can even help facilitate the purchase. In fact, this is one of the best reasons to work with a broker. You can take advantage of their car-buying expertise to navigate the process of finding the right car, negotiate a fair price and complete the transaction.

The downside of working with a car broker is that there’s usually an extra expense to consider. You’re paying someone to do much of the legwork in finding the car and facilitating the purchase, and that service comes at a cost—usually paid by you.

• Why choose a broker?

If you’re looking for a specific make or model and don’t want to deal with the hassle of checking out multiple dealerships or sellers, a car broker can do the work for you. Just make sure you know their fees upfront!

Buying a car from a private seller

Purchasing a used car from a private seller is another option for car buyers. Private sellers may offer lower prices than dealerships, and negotiations tend to be less formal. It’s a great avenue for buying older or specialty vehicles that might not appear on a dealer’s lot.

That said, buying a used car from a private seller comes with certain risks. Without a dealership to vouch for the history of the vehicle, you might not actually know the true condition it’s in. Additionally, you may have little-to-no legal protections or warranty in the event something goes wrong. The onus of the buying process is completely on you.

If you decide to work with a private seller, take some critical precautions. Always meet in a safe location and bring someone with you—especially someone who’s knowledgeable about vehicles. Ask to see any documentation they might have about the vehicle before negotiating anything.

• Why choose a private seller?

If you feel comfortable handling a vehicle transaction by yourself, engaging a private seller can save you quite a bit of money. Just make sure you have all the information you need to make a confident purchase.

Create your own car-buying experience

When it comes to buying a car, there’s no one-size-fits-all experience. Some people prefer the traditional experience of a car dealership, while others want the freedom to work with a broker or handle the transaction all by themselves. No matter which route is most appealing to you, remember that buying a car is a major transaction—you need to get your money’s worth out of it.

If you’re getting ready to buy a car, Navy Federal Credit Union is here for you every step of the way. Check out our Car Loan Calculator to help you figure out how much car your budget will allow, or you could get preapproved if you plan to finance your next vehicle.