Introduction

Welcome to the exciting (and sometimes dangerous) world of online automobile shopping.  You may be dipping your feet into these turbulent waters because you're interested in buying a classic automobile and want to expand your selection beyond what’s locally available, or you may be interested in finding a bargain on a slightly used vehicle and prefer to use the Internet to do your searching.  Whatever the reason, it’s best to be prepared by arming yourself with information that will make your transaction go as smoothly and quickly as possible.

Traditional newspaper and specialty classified ad magazines have been around since the early days of the automobile. They provide a forum where buyers and sellers can meet and begin the process of negotiating for a sale.  These traditional ad sources are limited in their ability to present vehicles that match an individual's taste.  For example, there is no way to search quickly through the classifieds by a number of criteria.  If I'm interested in a 1970 classic car in North Carolina with a price of less than $25,000, I'm forced to scan through all the ads, performing the search manually.  The Internet has changed all that.

Today online classifieds and auction sites can allow each user to tailor the listings presented to their taste.  You can search by a number of criteria and limit your listings to just those that you have an interest in.  And with nationwide offerings, your choice of vehicles is much greater than any newspaper ad or circular.

But with the advent of Internet shopping there is a greater danger of being a victim of fraud during the buying process.  If a local seller lists a car and misrepresents its condition, you'll likely discover this error during your inspection or test drive.  You'll get to physically see the car (and the seller), which greatly reduces your risk.  With an online transaction the seller and car may be half-way across the country, making an initial inspection difficult.  You'll rely more on the seller's ability and desire to accurately describe the vehicle when you make your determination to buy.

Why Buy Online?

As mentioned, one of the best reasons for buying anything online is the expanded range of choices you have.  A web site like eBay Motors can show you cars from across the nation and provide you with cross-selections that may lead you in a new direction when making buying decisions.

Perhaps you started out looking at Ford SUVs, but while searching through vehicle listings you came across a reference to a Chrysler Minivan that fit your needs better.  This ability to analyze the available vehicles in a variety of ways is what makes shopping on the Internet such a powerful resource.

Online shopping also can provide you as a buyer a certain level of anonymity.  Most sellers will list an email address as well as a phone number.  By contacting the seller via email and asking a specific list of questions (we'll cover this later) you can weed out potential vehicles without actually speaking to the seller.  This means you can pose your questions at any time of day, and the seller can respond at their convenience.  Email responses can also be saved, making remembering the responses to your questions that much easier.

In order to make buyers feel comfortable in purchasing vehicles online, big auction sites like eBay Motors offer a "Buyer Protection" service.  EBay's coverage provides insurance on any car purchase up to $20,000.  If the seller mis­represented the vehicle, or doesn’t provide a vehicle at all, eBay Motors will cover your losses.  This is a great selling point to using eBay's services; it also highlights some of the risks associated with online car shopping.

Risk Management

Purchasing any car is all about risk management.  You want to minimize the chances of ending with a lemon; or worse, being outright scammed by the seller.  The best way to reduce your risk is to understand the factors that go into determining it.

Risk Factors:

o        Is the seller a reliable source of information?
o        Is the car represented correctly?
o        What is the long-term maintenance cost related to the car?
o        Does the car come with any service history?
o        Do I understand all the related costs associated with purchasing the car?

Verifying that the seller is a reliable source of information can be difficult.  Use your instincts and ask as many detailed questions as possible to “feel” the seller out.  Also REVIEW the responses carefully.  If a person isn't being honest in their answers to your questions they'll usually have trouble keeping their information consistent.  Be concerned with ANY discrepancies in the facts that the seller states during the transaction.  Of course use your discretion.  People make honest mistakes.  Follow up and get clarification to any additional questions you may have.

Going hand-in-hand with the honesty of the seller is the knowledge that the car is being represented correctly.  Not every seller fully understands what they're selling.  This especially is the case with rare or exotic cars.  Options that are on the vehicle when it's being sold may or may not be original factory options.  If this is important to you it's best to do the research on the car yourself.  Ask for the VIN number and use a reliable source like CARFAX to do your checking.

Maintenance costs for used cars are a huge unknown unless you have the past maintenance history.  A log book or service book being offered with a car is a huge boon to determining risks.  This is very important with rare and exotic cars.  DeTomaso Panteras, for example, can have expensive repair bills down the road if they're not maintained properly.

There are plenty of costs associated with any purchase above and beyond the asking price.  Make sure you understand exactly what you're getting yourself into before you make any bid.  "Read Twice, Bid Once."

How to Shop Online

There are several rules to buying a vehicle over the Internet.  Some of these rules pertain to any car purchase, online or not.  But there are several new challenges that online shoppers must face, and be aware of how to handle.
Have a Budget

Probably the biggest danger in auction shopping is getting caught up in the excitement.  Don't bid more than you are comfortable in paying.  When considering the expense of the car, always remember there are several factors you must include:

o        Cost of the Vehicle
o        Buyer's Fees for the auction (if applicable)
o        Titling Fees and Licensing
o        Taxes
o        Vehicle Inspection
o        Transportation

This means if you're going to buy a $10,000 1965 Mustang, the actual cost might be:

Cost of Car                              $10,000.00
Buyer's Fees                             $0
Title Fees                                  $450.00
Taxes (8.5%)                            $850.00
Inspection                                 $100.00
Transportation (enclosed)          $1,000.00
Total                                         $12,400.00

So in this case, the true cost of the vehicle is going to be over $12,000, 20% more than you might think if you just look at the auction price.

Set yourself a true budget and stick with it.  If you only have $10,000 to spend on the above Mustang, you'll be shocked after winning the auction to discover you still need to pony up another two grand to be able to drive the car.

More information is available in our book: Mastering eBay Motors - How to Get the Max when Buying or Selling Online