Everything You Need to Know Before Buying a Car Online

By the Mercury Team

These days, almost every want and need is just a click away; so it’s no surprise that consumers looking for a new or used vehicle do most of their research from mobile devices or computers. And, increasingly, these same car shoppers are also skipping the hassle of the dealership in favor of the online car buying experience. What was once a stressful, time-consuming process involving multiple trips to dealerships can now be accomplished from the comfort of your couch.

However, before you purchase that new-to-you electric vehicle or shiny new truck, make sure you’re doing it safely and checking all the right boxes.

The Rise of Online Car Buying

The automotive industry has seen a significant transformation over the past decade. In 2020, according to Consumer Affairs, the online car-buying market was valued at $237.9 billion. That number is expected to grow to $722.8 billion by 2030. Today, more people are turning to the internet to explore, compare, and purchase their next ride. A growing number of buyers are able to complete the entire transaction online, from financing to delivery, without ever stepping foot into a showroom. Why? It’s super convenient to shop or research your options from home. If you’re going to a dealership, you’ll only have select makes and models available, and buying a car online means you won’t have to deal with pushy salespeople or the back-and-forth haggling.

How to Buy a Car Online

Ready to get started? You may have your mind already made up on a make and model, but make sure you’re taking the following steps before you enter into any agreement.

Get Pre-Approved for a Loan

Getting pre-approved gives you an idea of how much you can afford, and it gives you leverage when negotiating.

Set a Budget

Read reviews, check safety ratings, and compare prices across various platforms. If you don’t have your heart set on a particular model, find the features that matter most to you in a vehicle that’s within your financial reach.

Know the Value of Your Trade

Even if you’re trading in that trusty Honda Accord with more than 200,000 miles, make sure you know the value ahead of time to ensure you get a fair offer. Use Kelley Blue Book to help determine your vehicle’s value. If you’re wondering how does trading your car in work, the process typically involves getting an appraisal from the dealership, which is then applied as credit toward your next vehicle purchase.

Online Car-Buying Process

So you’ve got your financing in order, and you have some idea of the type of car you want. Now, it’s time to officially start the search.

Find the Right Car

Use filters to narrow down your search by make, model, year, price, mileage, and other nice-to-have or non-negotiable features.

Contact Your Local Dealerships for Price Quotes

Consider reaching out to several dealerships to get written quotes. You may find that they can come in lower than the online price, but at the very least, you’ll have some leverage when it comes to comparing deals and initiating negotiations.

Negotiate Online

The site on which you’re shopping may not advertise it, but you can, in fact, negotiate prices via email or chat. Don’t accept the first offer, and do ask for extras like free delivery, discounts, or upgrades.

Schedule a Test Drive

Some platforms or dealers offer at-home test drives. Take advantage of this to ensure the car meets your expectations.

Sign and Drive

When you’re satisfied, sign the paperwork digitally and upload all the required documents. Some services will even deliver the car right to your doorstep — and haul away your trade-in.

Is It Safe to Buy a Car Online?

Yes, it’s safe to buy a car online. Just make sure you do your due diligence before you enter into any agreement.

Inspect the Vehicle

If you are purchasing a pre-owned vehicle, request a full inspection and have a vehicle history report run using the Vehicle Identification Number (VIN). If you’re wondering what is a VIN number, it’s a unique 17-character code assigned to every vehicle that provides information about its history, ownership, and manufacturer.

Read the Fine Print

Understand all terms before signing. Look for hidden fees, return policies, and warranty coverage.

Be Aware of Fees

Online purchases may include delivery fees, document processing charges, or sales tax. Factor these into your budget.

Check Online Reviews

Research sellers on review platforms and in forums. A good reputation is a strong indicator of the seller’s reliability.

Best Place to Buy a Car Online

The best place to buy a car online depends on your priorities—whether you’re looking for new or used vehicles, financing options, or delivery convenience. For pre-owned, Carvana stands out for its seamless, end-to-end online experience, offering a wide selection of vehicles with seven-day returns and home delivery. Similar in model to Carvana, Vroom has slightly different inventory and pricing. For those wanting more flexibility or a private-party deal, Cars.com and Autotrader offer extensive listings from both dealerships and individual sellers. If you’re focused on new cars with manufacturer-backed incentives and certified, preowned programs, TrueCar and Edmunds are excellent for comparing prices and securing deals from certified dealers.

Don’t Forget Car Insurance! Protecting Your New Ride

"Buying a car online offers convenience,” says Justin Yoshizawa, Director, Product Management State, for Mercury Insurance. “But protecting your investment with the right amount of car insurance coverage starts the moment you plan to own that vehicle.” In fact, once you’ve found the vehicle you plan to purchase, you must have car insurance in place. You’ll need to provide proof of insurance before the dealership finalizes the paperwork. Many online platforms allow you to upload proof of insurance and other documents directly.

Mercury provides flexible coverage options and quick online quotes tailored for digital car buyers. Whether you’re getting a brand-new SUV or a used sedan, we can help you find quality, cheap car insurance that meets all your needs.

Final Checklist Before Clicking “Buy”

You’re about to make a significant purchase, whether for yourself or a family member. So before you dot those i’s and cross those t’s (electronically, of course), go through this quick, final checklist:

• Confirm that the VIN, the car’s mileage and condition all match that of the original listing.
• Review the return policy of the online platform. Carvana, for instance, offers a seven-day money-back guarantee.
• Make sure you understand all the contract terms, including financing, delivery, and warranty.

Conclusion

With countless platforms, large inventories, and digital convenience, the car-buying journey has never been easier. By following a structured approach, from budgeting and research to insurance and signing, you can master buying a car online with confidence.

Contact us today for a fast, free quote!