Used Auto Buying: Seller Types - Franchised Dealer, Independent Dealer, and Private Party
It’s important to note that three types of sellers can potentially be selling a used auto: Franchised Auto Dealers (a dealer licensed to sell new and used autos), Independent Dealers (a dealer licensed to only sell used autos), and Private Parties (a consumer selling their own auto).
Franchised Auto Dealers
A Franchised Dealer tends to be a more established dealership since they are a franchisee of a major manufacturer which means they sell both new and used vehicles. Buying from a franchised dealer has unique advantages, including: they have usually been in business for many years, they have more sophisticated operations including servicing departments, they have a large selection of inventory to choose from, and they have unique access to high quality used Autos (lease returns, etc.). But, franchised dealers also have overhead costs to maintain a large dealership, and therefore may have higher auto prices.
If purchasing from a franchised dealer, one important piece of advice is to always ask for the Internet Manager at a auto dealer, this individual usually seems to understand that buyers that use the internet are prepared and have done auto research online regarding pricing and features.
Independent Auto Dealers
A Independet Dealer is a dealer that is licensed by your state to sell used vehicles. There is a specific process that a independent dealer must go through to become licensed, but for the most part, anybody can become a licensed independent auto dealer with some time and small investment. So, as a auto buyer you want to be a little more cautious when buying from an independent.
Although their dealership and inventory size may be smaller, there are plenty of high quailty independent auto dealers that can provide a fair deal. In addition, if you have credit problems, many established independent Auto dealers specialize in trying to help poor or bad credit buyers purchase a older model and cheaper Auto.
A private party is an individual that is selling a Auto that they actually own. Although you may not have some of the same options that you get buying from a licensed dealer (dealer warranty, finance programs, etc.), buying from a private party is often the best way to get a specific auto at the lowest possible price. In addition, it can be a great advantage to buy from a private party that you know or feel comfortable with if you trust that they have done a good job maintaining and driving the auto.
You can potentially save a lot of money by purchasing a auto from a Private Party or since they have no overhead costs, but take the time to have the auto inspected by a mechanic to protect yourself. Also, contact your local DMV to find out the costs and process associated with registering a private party purchased auto with your state.
Make sure you run or receive a auto history report on any used auto, and investigate your finance, insurance, and warranty options before you visit the seller.