This Is the Cheapest Place to Buy a Used Car

Photo by RomanR / Shutterstock.com

If you are looking for a great deal on a used car, check out the inventory at a local car rental agency.

Rental car dealers typically offer vehicles at 1.6% below their market value, a better deal than you will find at dealerships, according to an analysis from iSeeCars. On average, buying from a rental agency will drop your purchase price by $303.

In compiling its numbers, iSeeCars looked at more than 8.5 million used car sales across three dealer types:

  • Traditional brick-and-mortar dealerships
  • Virtual dealerships
  • Rental car companies

The car search engine found that you actually will pay 0.2% more — about $31 — at a traditional local dealership, and a whopping 2.4% more — or $444 — at online dealerships than you would at a rental car agency.

Karl Brauer, executive analyst at iSeeCars, says there are a couple of reasons why rental car agencies tend to offer better deals:

“Because rental car companies buy their cars at a high volume and at a discounted rate, they’re able to sell these vehicles for less to consumers, and they price the vehicles to sell in order to move their inventory quickly. Additionally, rental car companies are also more likely to discount their vehicles given the financial hardships they are facing from the COVID-19 pandemic.”

In fact, rental car agencies offer the biggest savings on 13 of the 25 most popular vehicle models. However, as iSeeCars notes, more than 98% of the inventory at rental car companies is no more than 3 years old. So, if you are shopping for an older model, you will have to look elsewhere.

Getting a great deal on a used car

Shopping for used cars is usually a good idea, as you avoid the nasty depreciation that occurs in the first few years of a new car’s lifespan.

However, simply buying used does not guarantee you a great deal. As with any major purchase, you must do your homework and avoid key mistakes.

For example, many buyers fail to zero in on a car’s total cost. As we have reported:

“One of the most serious errors car buyers make is to concentrate on monthly loan payments instead of the total cost of the car. It’s possible to negotiate your monthly payment to suit your budget and still end up spending more than you had planned — or could afford — to pay.”

For more on preparing to buy, check out “5 Steps You Must Take Before Buying a Used Car.”

Once you have purchased a vehicle, increase your savings by getting a deal on auto insurance. Third-party sites such as Gabi or The Zebra can find the best rates for you if you don’t have time or patience to call around to insurers for quotes.

Money Talks News founder Stacy Johnson details his own experience using Gabi in “How I Found $546 in Car Insurance Savings in Under 10 Minutes.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
Beware These 5 Common Work-From-Home Scams

You can spot scammers and con artists with a little know-how.

8 Amazon Picks Under $30 for Coffee Lovers

We’ve brewed up a list of amazing Amazon products that are sure to perk you up.

The Best and Worst States for Raising a Family in 2020

There are trade-offs no matter where you live. However, some states have big advantages when it comes to choosing a home for your family.

6 Investing Tools That Help You Diversify

Here’s how you can lend to startup businesses, fund social causes or get in on investments once available only to the very rich.

14 Service Providers Most Likely to Lower Your Bill If You Ask

With these companies, it might be easier than you think to negotiate your monthly bill down.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Am I Eligible for My Mother’s Social Security Benefit?

Can an adult daughter tap into her late mother’s benefit?

9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

This Surprise Factor Can Raise Your Risk of Dementia

Nearly half of U.S. residents may face this threat.

Organize Your Home With These 10 Thrift Store Finds

Resolve to be clutter-free in 2021 with these secondhand purchases.

11 Laws You Could Be Breaking Without Knowing It

Seriously? Fibbing about the weather is a crime? This and other little-known legal traps await the unwary.

Is This Treatable Condition Causing Your High Blood Pressure?

Researchers say too many doctors are overlooking this potential source of hypertension.

13 Things Seniors Can Get for Free — or Almost Free

There are many ways to get cheap or free services and goods after reaching a certain age.

These Are the 3 Best Used Cars You Can Buy

These vehicles boast reliability, safety and long-lasting value.

21 Items to Cut From Your Budget That You Won’t Even Miss

Start off the new year by implementing these small-but-smart savings strategies. They’ll soon add up.

Internet Providers Can’t Charge You for This Anymore

Starting this month, your ISP no longer can bill you for this fee.

Taking a Multivitamin? Here’s Why You Should Reconsider

A new study has bad news for the millions of Americans who spend money on multivitamins.

15 Painless Ways You Can Cut Costs in 2021

Follow these tips to save, so you’ll have money for things that really matter.

9 Small Expenses That Are Bleeding Your Budget Dry

Keep more of future paychecks by eliminating these budget-busting unnecessary expenses.

11 Huge Retirement Costs That Are Often Overlooked

Does your retirement budget account for all of these costs?

7 Tricks to Cleaning Your Bathroom Faster

These tips can get your bathroom sparkling with little time and no elbow grease.

20 Amazon Purchases We Loved in 2020

These practical products made everyday life a little easier last year — and will do so in the new year, too.

10 Times You’re Right to Be a Cheapskate

Clever shoppers can save money without sacrificing quality. Here is how to do it.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.