Buying a Used Car – Dealer or Private Seller?

Ready to buy a used car? You have a choice – you can buy from a used car dealer or from a private seller. Here’s some information to help you decide.

Buying from a dealership

used cars on a rack stacked 4 high
Used cars on a rack stacked 4 high

There are a number of differences between buying from a dealer versus a private seller.

  • Financing. Let’s look at financing.  Dealerships offer a variety of payment options, including in-house financing and leasing, which means you can avoid going to the bank.  Because there are a variety of price points on a variety of vehicles, it’s easy to find a vehicle that fits your budget.
  • Paperwork. Typically, when purchasing a vehicle through a dealership, the dealer handles all the paperwork, including title transfer and registration. Some dealers will also contact your insurance company on your behalf.  And sometimes dealerships offer warranties on their used cars.
  • Certified Pre-Owned. Many dealerships offer Certified Pre-Owned, which means the used car has been inspected and repairs completed, if needed, and comes with a special warranty.
  • Trade-in. If you already have a vehicle, you can use it as a trade-in, which could be part of your down payment on a new car.
  • Legal Protection. There’s also more legal protection when buying from a dealership in case you end up purchasing a vehicle that ends up having major problems.

Buying from a private seller

keys being handed over for a car purchase
Keys being handed over for a car purchase

If you’re shopping privately, you’re shopping for a used vehicle. Many private sellers use the Canadian Black Book to determine their asking price so sometimes, you may have more negotiating room with private sellers. However, buying from a private seller can have its risks.  For one, they are not bound by provincial regulations.

  • No Warranty. For one, you won’t get a warranty and most vehicles are sold, “as is”, which means you’re stuck with any problems.
  • No Trading. In a private sale, you must pay with cash up front, so trading in your current vehicle is not an option.
  • Limited Choice. It can be a challenge to find the right vehicle you want if no one is selling it locally. You’ll spend a lot more time finding the right vehicle unless you’re lucky. Then, if you do find one you like, it may not have some of the accessories you want, so you’ll have to upgrade on your own.
  • History and Inspection. It’s hard to know what you’re getting yourself into without an accident history or inspection. It’s always a good idea to get the vehicle inspected by a trusted mechanic but that may be on the seller’s time, not yours.  You should also check to see if the vehicle is listed as stolen or if there are any liens on it.
  • Paperwork. Then there’s the paperwork, such as the Bill of Sale, transferring registration, Safety check, taxes, etc. that will be completed between you and the seller.

It’s Your Choice

It appears that buying from a dealer is the way to go but that’s not to say that buying private doesn’t have its perks. You have to consider your budget, your time and your comfort level, then make your choice. If you’re ready to search, you can browse vehicles in your area on, and sort them to find the perfect vehicle for you.

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