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Used Cars Are Going for a Steal

15:30 June 01, 2020
By: John Glover

Few archetypes say "untrustworthy" like the used-car seller. We're all familiar with the fast-talking, cheap-suit-wearing devil who sells the customer a flashy car that runs on sawdust and falls apart faster than you can say "charlatan." Believe it or not, then, CNN Business says that rental car companies offloading their used fleets are the "it" dealerships right now.

With the coronavirus pandemic having depressed business trips and tourism alike, the travel industry has run into considerable trouble. That sector includes the big three rental car companies: Hertz, Avis, and Enterprise. Hertz recently declared bankruptcy. Their going-under means potentially lightly used cars at clearance-sale prices.

The surprising thing is that experts say the rental car companies were already offering good deals for purchasing vehicles, before quarantining turned the country's airports into veritable ghost towns. The big three companies routinely downsize their merchant fleets to make room for new additions. Enterprise apparently offloads a million cars a year on the market.

In 2017, an analyst with the auto sales website edmunds.com compared prices between big used car company listings and the market at large. Direct purchases from used car companies yielded dramatic discounts of 5 to 15 percent. For anyone who finds the idea of bartering with a salesperson stressful, the rental car companies often have no-haggle listings as well.

Other convivences include more generous test-drive opportunities. Customers report being able to take the cars out for hours, and in the case of Hertz, the company will actually bring the car to where you live, if the location doesn't exceed 75 miles' distance.

Another unique feature of the rental company car sellers is their "rent-to-own" feature. Shoppers can rent prospective vehicles for a period of days before either purchasing it or returning the car for a $200 restocking fee.

For people duly scared of the old sawdust trick or what have you, it generally behooves them to examine the car first or take it to a trustworthy mechanic. Some customers could be wary at first because of previous drivers. The idea is that people are less kind to a car that they rent than one that they own. The extended tryout period comes in handy here.

Some rental car companies offer convenient financing options. Hertz reportedly offers sellers an option that's 0 percent down plus no payment for 45 days.

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