Is CarGurus Legit?
With the rise of second-hand car purchases and an uptrend in online car buying, it's only natural for the two to meet in online services like CarGurus. As a car shipping company, we’ve helped a lot of retail and wholesale customers move cars bought and sold on CarGurus, and we often get asked if it's a legit service. In short, our findings are that “Yes, CarGurus” is a legitimate automotive marketplace that acts as a middleman between retail customers and dealerships. Its main draw is its deal rating, which indicates whether a certain listing is a good deal or not.
Who should use CarGurus?
CarGurus is a marketplace, and it is used both by dealerships to list their offers and by private citizens who are looking for an easy and safe way of finding a suitable second-hand vehicle. If you are in the market for a brand-new-to-you car, then this marketplace will give you plenty of choices. If you are looking for a specific type of vehicle, trim level, or even color, chances are you’ll find at least one model here. If you are looking to buy a used car, then this is the right place for you.
Who should avoid CarGurus?
Most of the offers on CarGurus are second-hand vehicles since it is a used car marketplace with many different car listing choices. If you are looking to get a brand new vehicle, then going the CarGurus route might not be the best solution for you. If you are looking to buy from a private seller and not a dealership, then we recommend going elsewhere, as CarGurus mostly works with certified dealers.
What Is CarGurus and How Does It Work?
In short, CarGurus is an online car marketplace that hosts and evaluates car listings for dealerships. It offers some financing options to customers that do not affect your credit score for just checking, as it would do if you were to check with a bank Its main draw is its deal rating systems which check to see if the price of the car is fair compared to other offers on the platform. It takes into a scout the market value of the vehicle. In other words, by using CarGurus, you can check if an offer is a fair price or not.
Buying a Car Through CarGurus
Buying a car through CarGurus ultimately involves directly communicating with a dealership. CarGurus itself does not host the sale, nor are they financially responsible for the vehicle. They, however, have an abundance of dealership options with a vast inventory and dealer reviews. As a car-buying platform, CarGurus makes it easy for customer reviews to dictate whether a dealer has a high rating or not.
Selling a Car on CarGurus
In order to sell a car online through CarGurus, you have to be a licensed dealer who is allowed to operate in a certain state. This platform allows private customers to contact authorized dealerships and browse through their inventories, but does not ultimately allow private sellers to post on their website, either out of safety concerns or as a way to moderate their platform more easily.
How CarGurus Makes Money
CarGurus is very transparent about what its finance model is, as it mainly focuses on dealership subscription models. It makes money by delivering targeted digital ads on its website. It also collects a small fee when any sort of transaction is made through the platform. Their main breadwinner is their dealership subscription and lead generation funnel, which has dealerships paying monthly subscriptions to be able to post vehicle listings on their website. The pricing of a subscription is based on the size of the dealership and the size of their inventory, as well as their targeted geographic locations.
Pros of Using CarGurus
CarGurus deal estimations are fair as the service is not incentivized to subvert consumers but rather to showcase the best deals on their platform. Since they do not take a cut from the profit of the sale from the dealership, they can focus on showcasing the true information regarding the fairness of a deal. You can trust that estimation to be truthful and insightful, which means that dealerships will be much more selective and careful with the prices of their listings. This means wasting less time on searching through overpriced listings and more time spent negotiating with dealerships on fairly priced deals.
Large Selection of Vehicles
One of the main draws to platforms like CarGurus is the large selection, an often overwhelming number of vehicles available. Since CarGurus is an online-based company that holds no inventory, it has a nationwide reach, and therefore, it can host any number of listings, regardless of geographic restrictions. It also has a robust filtering system which allows customers to quickly locate the type of car they are looking for.
CarGurus Deal Ratings
As we’ve already mentioned, CarGurus offers deal ratings automatically for each listing. This means that customers can easily see if a certain listing is a fair price or not. This saves both time and money for dealerships and customers alike, making the platform a preferred way of streamlining sales and customer acquisition for dealers.
Easy Price Comparison
It's easy to compare prices of multiple listings and see which one best fits your budget. You can save and favourite listings, allowing you to check a listing’s fairness level and compare it to other old or new listings at any time.
Dealer Reviews and Transparency
One of the most important aspects of using CarGurus is that it has built-in dealer reviews, which help customers determine whether a seller is trustworthy or not. It also showcases the quality of their selections, and it helps customers find better, more suitable deals based on their location and preferences. This is one of the main reasons the platform is trusted and is used by so many private buyers and is the go-to place for authorized dealers.
Cons of Using CarGurus
Just like with anything in life, CarGurus, too, has cons that can offset the benefits of using the service. Here’s what our research has discovered and what you should be cautious about.
Not Every Listing Is Verified
One of the biggest drawbacks is that, despite the website's desires, not every listing is verified to be present or available. This means that customers can find a car they like from a dealership nearby that they trust, but the car can no longer be available.
Limited Control Over Dealers
While CarGurus has guidelines in place and does police the dealerships, it cannot control exactly what sort of cars they post, nor can it control the communication or provide monitoring once the customer contacts the dealership. This means that customers have to be advised to be careful when selecting a dealership. That is why CarGurus has left the power in the hands of the customers and opened its customer reviews and dealer reviews.
Vehicle Condition May Vary
Its important to note that while dealerships are obliged by the “Lemon law” to disclose the condition of each vehicle, and with the advent of vehicle history report services like CarFax, that the condition of the cars on the website can vary greatly. Customers will be aware of the condition of the car, but it will vary depending on how the previous owner has looked after it - these are the risks of buying a second-hand car online.
Financing Depends on the Seller
CarGurus does not offer financing, but rather facilitates the connection between the seller and the buyer. This means that the financing will depend entirely on the seller and what sort of options they have available. Unless a customer is buying out of pocket or is already pre-approved by their bank for a car loan, they will have to deal with the dealership’s financing options.
Common CarGurus Complaints
Some issues with CarGurus need to be disclosed before we can continue with the next segment. Customers need to be aware of certain complaints that users have expressed over the years. That being said, the website is optimized in its current state and is a good source of information and research.
Misleading Listings
Some listings can be misleading in terms of the price or the condition of the vehicle. While CarGurus does police dealerships to some extent, the majority of customers have to do their own research on the used vehicle listings they prefer. Online car shopping hides risks of not getting the full picture of the condition or the history of the car.
Dealer Communication Issues
One of the most prominent issues and concerns that CarGurus users have spoken out about are the communication issues they are having with dealerships. Some users are reporting they are waiting days or weeks to hear back from a dealership about a certain listing, which slows the entire process down.
Pricing Differences
There might be a pricing difference between what is listed on the website and what is available on the lot of the dealership. This is quite unfortunate and CarGurus have reportedly started policing dealerships who do not disclose the exact price of a listing. Dealerships, on the other hand, cite the reason for the price difference being the changing state of the market and technological delays on updating the price on their CarGurus listing.
Frequently Asked Questions About CarGurus
Is CarGurus legit?
CarGurus is a legit way for dealerships to sell a car online. It also provides private car buyers some protection and a way to determine whether a deal is fair or not. Due to their main income model, they are not compromised and seem to be a fair arbiter between buyer and seller.
Is CarGurus safe to use?
Yes, CarGurus is safe to use in terms of informational protection, as long as you are not prying through the service. It is also safe in terms that dealerships that are posting have to be licensed at least in one state and have a history in that state to begin listing cars, which means that there is a vetting process.
Does CarGurus sell cars directly?
No, CarGurus does not sell cars directly. It is a marketplace for dealerships to post their offers and listings and to reach out to individual private car buyers. It does not hold any sort of inventory, nor does it take a cut from the sale.
How does CarGurus make money?
The main way that CarGurus makes money is through subscriptions for auto dealerships and sellers. It also serves targeted ads to its visitors and does collect some fees from certain transactions on the website as well.
Can you negotiate prices on CarGurus?
You can negotiate the price of a car through the dealership that has made the listing. CarGurus does not own the cars that are being sold on the website and therefore cannot assist with the negotiation.
Are CarGurus Deal Ratings accurate?
Most of the time, CarGurus' deal ratings are accurate, but they do depend on the transparency of the dealership. If a dealer posts a low price on CarGurus and then posts a different price on their website, the fairness of the deal will differ.
Is it better to buy from CarGurus or Carvana?
It depends on what sort of deals and cars you are after. Most customers prefer to check on both websites and make a decision based on the price and the condition of the car.
Does CarGurus offer financing?
No, CarGurus does not offer financing. It’s a middleman and a marketplace for dealership listings.
Can you sell your car on CarGurus?
If you are a private citizen and a private seller, you cannot sell your personal car on CarGurus. You can do so if you are a dealership.
How long does it take to buy a car through CarGurus?
The buying process can take up to 1 or 2 weeks depending on the dealership and the type of car you are looking for. Rare models and makes are difficult to source which can take you even longer, but if the dealership that is publishing the offer is streamlined, then you can finalize the deal within days of finding it.
