buy a car online

How To Buy A Car Online in 7 Easy Steps

Chris Carter

Chris Carter

Are you curious how to navigate the process of buying your next car online? Read this article to learn a step by step process to save time and money the next time you are shopping for a new vehicle.


Buying a car online has grown in popularity over the past few years. Online retailers such as Carvana, CarMax, and Vroom have spent millions of dollars on marketing their offerings to the public. Also, more traditional brick and mortar dealers are getting in on the online shopping push by offering services like digital retailing and free delivery.

With high-resolution photography, video walkarounds, and instant communication with the sales staff, buy a car online has never been easier. With the recent developments of COVID-19, shopping for your next car online can save you time and money, but also keep you safe! Read on to learn more about how to buy a car online in 7 easy steps.

1. Know Your Budget

Nothing is more disastrous than finding a car that you love and then buy a car online, only to find out that you can’t afford it. That is why starting out with a written budget for your next car is essential. I recommend using popular budgeting apps like Mint or Dave Ramsey’s EveryDollar to get a written budget. Pen and paper work well too if you aren’t so tech-savvy! 

With a written budget in place, start to examine how much you could comfortably spend on a car payment every month. Be sure to include other expenses like gas, insurance, taxes, and maintenance, on top of the car payment. Having a car that you are proud of is great, but it is more important to have a car that you can easily afford. Cars are depreciating assets at the end of the day – so don’t spend too much of your hard-earned money on something that is going down in value.

2. Get a Pre-Approval Letter

After finding out how much car YOU can afford, it is time to approach a lender of your choice to get pre-approved for your car loan. This will allow you to be an informed and protected consumer when you actually go to purchase the vehicle. It will also prevent you from being taken advantage of while at the dealership through dealership markup.

There are a number of online services available that offer quick and affordable automotive loans. LightStream is one of my favorites and one that I’ve personally used in the past to make improvements to my home. They offer a quick application process, and you can get your funds the next business day if you are approved.

Even if you choose to get your next vehicle online, don’t forget about the numerous banks and credit unions that are in your local area. These organizations tend to offer extremely competitive rates, and it always adds a little peace of mind to know that there is a local branch if you run into an issue.

3. Research Popular Models

Now that you know your budget and are preapproved for your loan, it is time to narrow down the list of available vehicles. This is a step of the journey that should not be taken lightly. My advice is to spend the necessary time on this stage so that you can get the vehicle that best matches your needs.

YouTube is a great place to start when narrowing down the list of available vehicles. The following YouTube channels offer informative and entertaining content:

  1. Redline Reviews
  2. ThesStraightPipes
  3. carwow

Feel free to browse popular consumer guides, like Consumer Reports, to gather more information about the reliability and reviews of the vehicles that you are considering. Simply Googling “[year] [make] [model] issues” is also a good way to find out if there are common issues with a used vehicle you are interested in.

Another thing that you can do is go to a local CarMax to sit in several vehicles in one day. This will help you learn about the ergonomics of each vehicle to make sure that it will be a good fit for you. You can also explore key items like the infotainment system, the trunk space, and the overall feel on the interior of the vehicle. These are highly personal items, and hard to learn about without firsthand experience.

4. Research Local/National Dealers

Now that you have 1 or 2 key models in mind, it is time to determine what dealership you want to purchase the vehicle from. When buying a pre-owned vehicle, your choices can be boiled down to three categories. They are:

The Franchise Dealer

A franchise dealer has new vehicles on the lot, such as Chevrolet or Toyota. These are commonly thought of as your larger and most reputable dealers, as they have to meet strict franchise standards to sell new vehicles. They also tend to have the nicest facilities and a fairly straightforward purchase process. The amount of the transaction that you can do online will vary greatly depending on the individual store.

The Traditional Independent Dealer

This is the traditional brick and mortar used car dealership. Whether it be a small neighborhood dealership or a large operation, these dealerships do not sell new vehicles and specialize in pre-owned vehicles. With any non-franchise dealership, be sure that you carefully read reviews of the dealership before choosing to do business with them. Again, like their franchise cousins, the amount of the purchase that you can do online will vary greatly dealer to dealer.

The New Independent Dealer

This category is composed of several “technology” car companies like Carvana and Vroom that offer a seamless online shopping experience for your next vehicle. This type of business explicitly encourages you to shop online as they have limited facilities. Be sure to carefully research the business that you are considering to learn about common issues and things to look out for.

5. Start Communication and Negotiation

At this point, you should have 1 or 2 models in mind and have no more than 3 dealerships that you are interested in purchasing from. Start by reaching out to the dealerships. Be sure to give accurate information and set a realistic timeline. You’ll be amazed at how responsive most stores are when the internet salesperson thinks that they are talking to a real person!

If you are inquiring about a vehicle at a franchise or traditional independent dealership, be sure to ask about how much of the process can be completed online. It is also good to find out if the dealership offers at-home test drives or at least video walkarounds with a salesperson. 

If you are working with a new independent dealership/technology company, their process should be clearly outlined on their website. However, don’t be afraid to get a customer service representative involved early in the process. They are very familiar with the process within their company and can help you navigate the entire car buying process.

If negotiation is an option on the vehicle that you are shopping for, don’t be afraid to haggle! Use tools like Kelly Blue Book to get fair market value for your vehicle of interest and start 3-5% lower with the goal of meeting in the middle. The number one thing to remember when negotiating is to be respectful – and remember that the salesperson only gets paid if they are able to sell you a vehicle.

6. Select Your New Vehicle

Congratulations! You have almost purchased your new vehicle. Now it is time to look at your available vehicle options, purchase options, and financing options and select the best fit for you. Be sure to evenly weigh all possible options and find the best combination.

There is no rush so take your time and carefully think through the purchase! Be sure that you will be happy with the vehicle you have selected and that you are getting the best possible financing rate. The goal with purchasing a vehicle is to drive it for a long time, not trade it after a few years. This means to take your time and be sure that you’ll be happy with the outcome. 

At this point, let the dealer you selected know that you would like to move forward with the purchase of the vehicle. It is also courteous to let the other dealers know that you will not be moving forward with their vehicles. This allows them to remove you from their customer management tool and not to continue to reach out.

This is the time to schedule delivery, learn about what paperwork and documents will be required and to fine tune any last details of the transaction.

7. Complete the Transaction

The only thing standing between you and your new vehicle is a stack of paperwork! This means that you have successfully made it to the end of the online car purchasing process. Be sure to celebrate your new ride and treat it well so that it will transport you for many years to come.


Buying a car in person, let alone online, can be a scary and daunting process. However, by following the steps outlined above you can save time, save money, and have a better overall experience. 

Please feel free to leave a comment below if you’ve purchased a vehicle online. I’d love to hear your feedback on the experience. And remember, I’m here to help if there is anything that I can do to assist you in any part of your car buying journey. 


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buy a car online

How To Buy A Car Online in 7 Easy Steps

Are you curious how to navigate the process of buying your next car online? Read this article to learn a step by step process to save time and money the next time you are shopping for a new vehicle.