Car buying and car broker services explained

You can avoid a trip to the dealership by using a car broker or car buying service. These services let you research and negotiate the price of a car in advance so that you can make an informed decision about your purchase. Find out more about how you can work with a car buying service or car broker in Canada to find the best deal.

What is a car broker or car buying service?

Both car brokers and car buying services are designed to help you find a suitable car without you needing to do all the work yourself. There are several different types of car brokers and car buying services and each is a little bit different.

For example, a concierge car buying service does the shopping and negotiating on your behalf while an online car broker offers a virtual platform where you can go to compare cars. The best type of service for you will depend on your budget, time availability and motivation to find a car.

3 types of car buying services in Canada

1. Car concierge

Car concierges are car buying services that provide an agent to shop and negotiate on your behalf. You just need to specify what type of car you want and your car concierge will handle the sale from start to finish.

• How it works. Your agent sources suitable cars with car dealers or a car broker in Canada to meet your specifications. The agent then negotiates a price on your behalf, handles the paperwork and organizes delivery in some cases.
• How much it costs. You’ll usually pay an upfront fee and a percentage of whatever money you save compared to market retail prices for the car you want to buy.
• Example of service. Clutch.ca is a car concierge service that works in BC, Ontario and Nova Scotia. This service lets you buy a vehicle without doing any of the work to search for a car or negotiate your contract.

2. “Build and buy” car buying service

Get special pricing when you build the car you want from scratch and buy it directly from a dealership.

• How it works. You use an online tool to pick a make and model of vehicle, and kit the car out with the features you’re interested in. You then work with a dealership to get the car you want at a lower price (with no hidden fees).
• How much it costs. You may need to pay a membership fee or a percentage of the money you save.
• Example of service. Unhaggle.ca offers a build and buy service that connects you to dealerships to get a custom-built car for less than the market retail price. Dealers then bid on building your car for you through Unhaggle.ca so you’re guaranteed a good deal.

3. Membership-only car buying service

Get exclusive savings and incentives for buying a vehicle through an organization you’re a member of.

• How it works. You select a vehicle from a dealership that’s promoted by the organization you’re a member of. The organization gives you special offers, rebates and the chance to save money on the market value of your car.
• How much it costs. Usually free as long as you’re a member of the club or organization offering the car buying service.
• Example of service. The Costco Vehicle program offers exclusive discounts on vehicles to Costco members who shop with partner dealerships. You may also get incentives such as gift cards from Costco for buying a new car.

2 types of car brokers in Canada

1. Online car broker

An online car broker is a specialized service that lets you compare the prices of multiple cars from different dealerships, all in one place.

• How it works. A car broker will give you a list of cars that meet your specifications from multiple dealerships. This lets you compare prices and other features such as mileage, age and colour before you buy your car.
• How much it costs. Most car brokers are free since they charge a fee to the dealership instead of the customer. That said, you could pay a small margin on top of your purchase price to use a car broker in some cases.
• Example of service. There are car brokers in every city across the country. Nationwide examples of car brokers in Canada include Auto Trader, Car Cost Canada, Car Pages and Canadian Black Book.

2. Pre-financed car broker

Pre-financed car brokers let you obtain financing that you can only spend on a pre-selected inventory of vehicles.

• How it works. This type of car broker will pre-qualify you for financing. With the money you borrow, you can then buy a car from a pool of vehicles that the car broker has in the inventory of dealerships it works with.
• How much it costs. You’ll usually pay a loan fee and interest when you pre-qualify for financing with a car broker and buy a car. You won’t pay a fee to apply for financing with a car broker in most cases.
• Example of service. Nationwide examples of pre-financed car brokers in Canada include Canada Drives, Auto Loan Solutions and Autoloans.ca.

Not sure whether you should use an online service to buy a car? Take a look at our guide on buying a car online versus in person to find out if this option is right for you.

Compare car loan brokers in Canada

Whether you’re looking for a good deal on your next car loan, or pre-financing with dealers across the country, browse through the Canadian car loan brokers in the table below to compare your options.

Do car buying services or car brokers provide financing?

You usually can’t access financing through a car broker or other car buying service unless this is a built-in part of its service. Your best bet to get financing is to either apply with a pre-financed car broker in Canada, or get separate financing through your bank, credit union or an online lender. We’ve curated a list of car loan brokers in the table above where you can get financing, and in some cases, browse vehicles from across Canada.

A good approach to be able to shop with a price in mind is to get pre-qualified for a loan. This will let you know how much money you have to spend and you’ll be able to find the car you want without breaking the bank.

Benefits of using a car buying service or car broker in Canada

• More convenient. You can easily access a car buying service or car broker online in a matter of minutes (with no pushy salespeople to bother you).
• Saves you money. You’ll usually save money by comparing different vehicles and getting a full picture of how much you should reasonably pay for a car.
  Less work. You can access a pool of vehicles online and you may even get help from a customer service expert to find and buy the perfect car with some services.

What to watch out for

• Less control. You won’t have as much control over which dealerships or vehicles you want to shop from when you use a car buying service or a car broker in Canada.
• Potential for fees. You could end up paying an upfront fee or a margin off your savings to pay for using the car broker or car buying service.
• Not guaranteed. The car you get won’t be guaranteed in many cases, which means you could still end up with a lemon.

Is using a car buying service actually worth it?

It can be. Some people find that the money they save counterbalances the fees that brokers and concierges charge. Others enjoy the fact that they don’t have to deal with persistent salespeople during the negotiation process.

If negotiation isn’t a hassle and you don’t want to pay extra fees, then you may want to avoid certain car buying services (such as high-end concierge services). However, you can still use a free car broker in Canada to compare deals.

Bottom line

Using a car buying service or car broker to find the right vehicle for you can save you time and money. There are several types of services to choose from and each one comes with different features, depending on your preferences. Use this post to find out more about which car buying service or car broker in Canada could be the best fit for you.

Frequently asked questions

• Are my vehicle options limited if I use a car buying service or car broker in Canada?

  That depends. Your options may be limited if your car buying service or car broker only works with specific dealerships. This will mean you could miss out on better deals elsewhere.

• Can I get a used car through a car buying service or car broker?

  You’ll usually be able to access used cars through select car buying services and car brokers in Canada. However, some programs, such as the “build and buy” program, will only offer new cars.

• Do car buying services and car brokers offer financing?

  Not usually, unless you’re using a pre-financed car broker. Most car buying services and car brokers in Canada will expect you to have financing in place before they help you to find a vehicle. You can usually source this through your bank, credit union or a private lender using a separate application.

• How do I get my car once I purchase it?

  Many services will deliver your car to your home for a small fee, or you may need to go in to pick it up at the dealership. Just remember that if you get a car delivered between provinces, you could run into issues with licensing and registering your vehicle. You could also have problems returning it if there are defects.

• What's the most popular car buying service in Canada?

  Unhaggle.ca is one of the most popular car buying services for new cars because it lets you price match and get dealers to compete for your business. Unhaggle.ca also allows you to “build and buy” a new car from scratch.