Auto-Dealer vs Private Party

We Help You Choose: Auto-Dealer vs. Private Party 

From the car loan, warranty , selection and financing, there’s a lot behind buying a car. See if buying at a car dealer or through a private party is the best choice for you and your budget.

Let's consider your two options: 

Car dealership: an official business that should be backed by a better business bureau and may even offer return options should the car end up a “lemon.” At a dealer, you'll find easier access to warranty and repair packages, and often have the ability to special-order a vehicle to your specifications. However, with a dealership, the price of your car includes costs to run the dealership. Thus, there is less negotiation room on the price of the car. 

Private sale: typically a purchase from an individual A private sale is usually final sale, and most likely a used car. Used cars come with additional risk. You'll want to secure documentation (such as a CARFAX ), maintenance records, and ask questions regarding the vehicle's usage and care before you drive away. Despite the private sale offering less in the terms of choice – what you see is what you get – it may offer more in the terms of price flexibility. The private party may hope for one price but be willing to settle for a far different one, and one that may favor you, the buyer.

Service Contracts 

A service contract (formerly known as a warranty) helps pay for repairs when your vehicle breaks down. The right contract can be the answer to paying for necessary repairs, and different providers will offer different options of covered options. This is where a service contract can provide that peace of mind.

How to Shop for a Service Contract 

A little-known fact about service contracts: They have an MSRP (Manufacturer's Suggested Retail Price). Yet, just like a pair of sneakers that may have a suggested retail price of, say, $60, you could find the  same  shoes at five different shops for five different prices. The same is true with service contracts. Shop around and find the best price. Be sure to compare the same service contract. For example, ask what a 5-year, 75,000 mile contract is (on the same model car) so you're comparing the same product.  Be prepared with this information when you come to the negotiation table or researching after-factory contracts. Ensure that you are not only comparing price, but the coverage that suits your future vehicle's needs.

  • Dealer – A dealer usually offers multiple choices when it comes to purchasing a service contract, particularly with a new vehicle. A warranty may even be tossed in with the car as an incentive. An additional advantage when buying a warranty at the dealer is being able to bundle the price of the warranty into the price of the car – however, remember to ask as to the cost of the warranty.
  • Used – If buying a used vehicle, you have the option of buying an after-factory warranty. You can even purchase a contract extension of already existing warranty agreements. Click here  to explore one of many options.

Price Negotiation 

Understanding the value of the car that you seek is a mixture of Kelley Blue Book, your area's economic climate, the vehicle's history, and you. Can you walk away from it if the price isn't right?

  • Dealer – A dealer has overhead that it has to pay: You'll often find yourself negotiating price within a limited, pre-agreed figure. However, with a dealer you also may be able to negotiate upgraded features, add-ons, repair packages, unlimited car washes or repair services.
  • Private Party – The only individual benefitting from the used-car sale is usually just the individual. This may net you more or less wiggle room. Either way, you know that you are speaking to the “boss” – they have the final say when it comes to the sale price.

Be prepared: Whether it's a dealer or a private party, research the car's value  so that you know if you are getting a great or poor deal.


We can't always get what we want … or can we? It may be possible when shopping at a dealer, but not when choosing to buy from a private party.

  • Dealer – A dealer has the luxury of choice: selection abounds when at a car dealership. You may even find a car that you want in several different color options to choose from. Or, pay only a little more – or a little less – and pick the same vehicle just a year or two older or newer. A dealer also is often connected to a network of other dealers or even individuals who they can contact to find the car you seek. Was it the right truck but without the right sound system? Have them make a call. The choice is yours. 
  • Private Party – You are buying one vehicle from one person. What you see is what you get. If, once you test-drive it, it doesn't feel or drive right, then know to walk away, even if the price seems perfect, the seller wonderful, and the color options just the ones you always wanted. Get back to the hunt – there's always more showing up in car search engines every day.


Buying a car is generally not a quick errand no matter who you buy from – there's a test-drive, signing of paperwork, obtaining money. If you are acquiring a car loan, you have more paperwork to sign, either at the financial institution or in the dealership. See how it all breaks down.

  • Dealer –A dealer's sales office, negotiation table and finance office takes time, but is all conveniently located in one building. You may even find children play areas to help distract the kiddos during the long process, plus on-site snacks to keep you caffeinated and fed. BECU financing is available onsite with hundreds of car dealers in the Pacific Northwest and South Carolina. The dealer takes care of a wide variety of minute details that would otherwise be time consuming: transferring ownership and title, ensuring new plates are sent your way.
  • Used – Purchasing a car from a private party is a bit of a chicken-egg situation: Do you go in pre-approved before looking at the car, or do you look at the car and then become pre-approved? The good news is that once you are pre-approved, you have 30 days for any additional pulls on your credit score – it all counts as the same “pull.” 

Once you've found a car you are serious about test-driving, choose a safe, well populated public place for you and car owner to meet. Bring someone with you for a second opinion. Ready to sign? Consider the legwork involved: You'll eventually have to visit the Department of Licensing (DOL). This is an errand you'll need to do on your own, with the correct paperwork: transfer of ownership, titling, plates, etc. You'll want to head to BECU (you can make an appointment ahead of time) and get everything you need done for your auto loan. A member advisor walks you through the entire process – from what signatures are needed to how the loan is finalized – so you can go from car shopper to car buyer with ease.