Most car shoppers still prefer to buy cars the traditional way—visiting a dealership, inspecting the vehicle on-site, and negotiating the price with a salesperson. But a growing number of consumers prefer the convenience of using online platforms to find and purchase vehicles. A recent JD Power survey found that 16% of new vehicle buyers moved to online ordering in 2022.
Digital car-buying platforms make it easier to search for, finance, and purchase a vehicle without leaving home. Learn how to shop for a car online and secure the right financing and price on a new vehicle.
Setting a budget is the first step in purchasing a new or used vehicle. Buying a car usually involves the following expenses:
To set a budget, use an app like YNAB (You Need a Budget) or Rocket Money to determine disposable income that can be used toward a vehicle purchase and monthly payments. Then, use an online loan calculator to estimate the total cost of different vehicles based on prices, interest rates, and loan terms.
These steps give a realistic breakdown of the total cost of a new vehicle and help buyers determine what they can afford when shopping with online dealers.
It is important to check credit scores and history before applying for a car loan. Lenders use this information to determine loan terms, which can affect the total cost when buying a car online.
Higher credit scores, typically 740 and above, can make it easier to secure financing and lower interest rates, reducing the total cost of the vehicle. Buyers can visit sites like Credit Karma or Experian for a free credit check and to learn their score.
AnnualCreditReport.com can supplement that information with free credit reports. While these don’t include credit scores, they contain detailed information on credit accounts, payment history, inquiries, and pre-approvals. Reviewing this information can help car buyers address potential problems that can lower loan rates, such as outstanding debt or inaccurate details.
After setting a budget and sorting out credit information, it is time to research vehicles online to find the right makes, models, and trim levels. Sites like JD Power offer a convenient way to research vehicles and pricing and find real-time deals in a buyer's specific location.
Not sure what type of vehicle to purchase? Use the site’s search tool to browse options by body style, like coupe, electric, SUV, or luxury. It also offers lists of popular and trending cars for sale and top cars for sale by city to help buyers find the right vehicle. Ask questions like the following to narrow down possible options:
JD Power offers an instant compare feature for those with a specific car in mind. Enter information like the make, model, year, and zip code to receive live quotes and begin purchasing. These online features also allow buyers to discover vehicles for sale outside their immediate area, which can help them find the best deal available.
In 2024, 80.11% of customers used financing to purchase a vehicle in the U.S. Getting pre-approved for a loan can streamline the process and help a buyer secure financing more quickly for an online purchase. Typically, buyers can apply for pre-approval through their bank, credit union, or an online lender.
Auto dealers may also provide pre-approved financing plans to customers, often with manufacturer-specific incentives and promotions. While they may not offer the best rates, buyers can benefit from approval at the time of purchase for a faster sale and more convenient experience.
Online car shopping platforms like Carvana offer auto loans and online financing plans. Although usually reserved for the vehicles they sell, they often provide pre-approval to all customers, including those with bad or no credit.
After narrowing down the options to a few models within budget and a reasonable distance, car buyers may want to inspect the vehicle in person or request a test drive. Depending on where the vehicle is selling from, there are various options:
However, these companies do typically offer a money-back guarantee period, such as Carvana’s 7-Day Test Drive, during which the customer can return the car for any reason.
After seeing and testing the vehicle, the shopper can decide whether to purchase it. Depending on the seller, negotiating or requesting price matching may be possible. Before closing a deal, all shoppers should review the purchase agreement’s terms and conditions and be prepared to provide all necessary documentation.
If the price is right and the terms and conditions are satisfactory, all that’s left to do is sign, take delivery of the vehicle, and register it.
Today, buyers have several choices for buying a car, truck, or SUV online. With helpful sites like JD Power, shoppers can complete the vehicle-buying process online, including comparing prices, finding deals nationwide, and purchasing a car from the comfort of home.
Corentin’s passion for the automotive world started when he was just seven years old, during a life-changing visit to an auto museum. Now a seasoned writer, Corentin channels that early fascination into every piece he writes, whether he’s exploring the latest car trends or automotive history. But his expertise doesn't end there—he also brings his insights to topics like home improvement, the boating and yachting industry, personal finance tips, and cutting-edge tech.
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