Even during a global shut-down, sometimes you need to buy a car.
After all, if you have to get from Point A to Point B, you have to get there – and this isn’t a time when a lot of people want to take public transit. Of course, you may have financial reasons for wanting to buy a car now despite the circumstances. There are some pretty appealing offers out there. You can find auto manufacturers offering deferred payments for up to six months – and 0% APR loans for 84 months.
Odd as it may seem, if you feel secure in your job, and you want to find some of the best deals on cars, now might be a fantastic time to make a purchase.
So with that in mind, if you’re thinking of buying a car, what should you expect? And how can you stay safe? After all, it will do you no good to buy a car with the best deal ever — if a few weeks later you’re fighting for your life in a hospital.
Here are a few things to keep in mind:
Visiting a car dealership right now might be difficult, but it isn’t impossible.
Unless it is impossible. In other words, every state is handling this differently. In some states, dealerships are closed, and in others, they’re open.
In other words, before you take a drive to your dealership, give them a call first.
Currently, there are 24 states where dealerships are open. There are 23 states where the showrooms are closed, but you can buy cars online or remotely. In three states, Pennsylvania, Kentucky and Hawaii, all car sales, online and off, have been banned. That said, that could change any day. Legislation is being considered to allow Pennsylvania to do online sales.
New Orleans is a state where you can visit the showroom. That said, Charlie Tatum, a consultant for Superior Honda, a New Orleans car dealership, probably speaks for much of the industry when he says, “For people who want to visit the dealership, for either sales or service, we’re encouraging making an appointment in advance to expedite their visits and to be seen promptly upon arrival.”
But in general, people who work at car dealerships are (hopefully) doing their best to minimize contact. They don’t want to get the virus any more than you do.
“We’ve implemented social distancing measures within the dealership between customers and employees to minimize contact,” Tatum says. “We’re providing hand sanitizer made by a local New Orleans distillery, Celebration Distillation, to customers and staff and have one employee whose sole responsibility is to clean and sanitize surfaces at the dealership.”
In fact, Tatum says that right now, if you so desire, you can buy a car through their dealership pretty much the way you would through an online car buying website.
“We’re offering the ability to handle financing, credit approvals, and paperwork entirely online,” Tatum says. “Alternately, we’re providing the option to drop off documents to our customers. We’re also dropping off newly purchased vehicles.”
What if you need an oil change or the brakes looked at later, and you are still not able to access those services? Tatum says the dealership will pick up your vehicle, take it in to be fixed and return it.
You’re going to need to consider whether you want to do a test drive.
Assuming you have a car dealership that is open, you may want to skip the test drive.
If you feel strongly that you want to do a test drive, and that it’s crazy to not do one, you may be able to do one without being in the car with a salesperson. For instance, some dealerships, like CarMax, will let you do a test drive alone.
Other dealerships, even in a pandemic, will insist that a salesperson is in the car with you.
Tatum says that at Superior Honda, potential buyers can do a test drive – but “for insurance reasons,” a salesperson will be in the car with you.
“Our staff members do wear masks during any test drives,” he says.
If a salesperson is required to be present during the test drive, you’ll have to ponder just how important trying out the car is to you. If you’re buying a new car, a test drive may not matter to you so much. If it’s a used car, that may be another story.
You could opt to buy a car online, without coming in contact with anyone.
Plenty of people use car shopping apps to research cars that they then may buy at a car dealership, but as we all know, there are a lot of car buying websites that allow you to purchase a car – without going anywhere.
As in, you look for cars online, get the financing and order your car online, and the website brings you the car to your driveway.
In the past, these sites promoted the idea that it’s better to go with them because you can avoid haggling over the price. That means you’re locked into their price and can’t get a better deal, which isn’t necessarily a selling point, but a lot of people dread going into a showroom, locking eyes with a salesperson and then feeling as if they’re about to be steered toward a car that they can’t afford.
Now, of course, the car buying websites are promoting the idea that you can buy a car safely from them – and that you’re putting your life at risk if you shop for a car at a conventional dealership. Whether that’s accurate or not is up for debate, given that car dealerships are aiming for as contact-less a buying experience as possible, but these days, it’s a compelling message.
So how do these online car buying websites work?
For the most part, just how you would think. You search for cars in the website’s online inventory. You find one you like. Instead of kicking the tires, you kick around the idea of driving the car. You study the vehicle history report that the online car buying site likely has. You eventually settle on a make and model and either finance through the website or with somewhere else, like your bank. You order the car, and it’s delivered.
With a website like Carvana (and presumably all car buying websites, but Carvana’s PR person sent us information on how their process works), they’ll bring you your car to your home. After the car is unloaded, the Carvana customer advocate will sanitize the steering wheel and keys and then leave the paperwork for you to review and sign.
After you do that, the customer advocate will call you from the car hauler and stay with you on the phone as you look through everything, in case you have questions. Then assuming all is well, the car hauler and driver will disappear into the sunset. (Or maybe the mid-afternoon. It isn’t like there’s a set time for these drop-offs.)
And while there may be no test drive, Carvana – as do many car buying websites – offers a seven-day money back guarantee, and so if you hate the car, you have, in a sense, taken it for a test drive and can return it.
There are, as noted, a lot of car deals to be had.
If you are looking to buy a car, here some of the types of deals you’ll likely find.
- Deferrals. A lot of car companies are offering deferrals on the first payments, usually up to 120 days. That said, it may or may not be a great deal. Interest will accrue during those periods – at least on the car deals we checked – and, of course, if you’re struggling to make a payment right out the gate, maybe now isn’t the best time to get a car. On the other hand, if you just want to manage your cash flow, and you can live with some interest accruing, maybe a deferral is just what you want right now.
- 0% financing. Now this is a great deal. A lot of car companies are offering 0% financing for up to 84 months. For instance, if you’re interested in a car made by General Motors, you may find zero percent interest on loans for up to 84 months on some (but not all) Chevrolet, Buick, Cadillac and GMC models. Spoiler alert: You need really good credit to get this.
- Cash discounts. A lot of car manufacturers are offering cash discounts on cars. For instance, at the time of this writing, Honda Financial Services has been offering $1,000 toward the purchase or lease of some of their new models.
Sometimes you’ll find cars offering multiple deals. For instance, right now, Kia Motors Finance is offering new-vehicle payment deferrals for up to three months on select vehicles as well as 0% APR up for up to 75 months.
So there’s a lot out there for the interested car shopper. On the other hand, if that isn’t you, you may be left thinking, Boy, I wish I could take advantage of these deals, but I can’t really justify buying a car right now, and besides, mine works okay, kind of. If that’s your situation, then look at the bright side, sort of.
With all of this social distancing and sheltering in place, where were you going to drive your new car, anyway?
For more Living on the Cheap articles:
- How to decide whether to buy or lease a car
- Used car shopping? Do your homework
- How to get the best new car deal
- Tips on donating your car to charity
- Shop for cars using an app