What is an Auto Broker?

An auto broker is a licensed professional who provides the service of purchasing a car on behalf of their client. In the past, auto brokers had a reputation of being only for the high-end car market. However, today they have more broad appeal to anyone who wants to simplify the car buying experience. In order to understand the appeal of auto brokers and decide whether or not they are a good choice for you, it is important to learn what an auto broker does. Keep reading below to discover how an auto broker works, what kind of broker services are out there, and comparing the buying process between auto brokers and car dealerships.

What does an Auto Broker do?

An individual who wants to buy a car can pay for the services of an auto broker to make the process of buying a car more simple, and in some cases less expensive. When working with an auto broker, they will first ask you what features you want in a car, and what your desired price range is. After analyzing all of your preferences, they will narrow down the best options that meet your expectations. 

The auto broker will speak to the car dealerships and negotiate the best price possible. This makes the car buying experience take much less time, and you can get a much better price than if you had bought the car by yourself. That’s because auto brokers are experienced in interacting with salespeople, along with haggling for the most fair price possible. 

What Kind of Service Does an Auto Broker Provide?

From start to finish, an auto broker will take care of every aspect of searching for and buying the vehicle that fits all of your needs. They will do a thorough and lengthy search of your best matches, and schedule test drives for you so that you can finalize your chosen vehicle. Once the selection is made, the auto broker will negotiate the price and financing, and then purchase the vehicle from the auto dealer. The auto broker’s service is very high-touch and fully inclusive of the entire car purchasing process.

Difference Between an Auto Broker and a Dealer

While auto brokers and auto dealers may offer similar types of services, the full extent of their assistance is very different. Even though they both help with the selection and financing elements, their motivations and level of service are what set them apart. 

Even though a dealership has salespeople onsite to help you select a car, they are only interested in selling you the cars in their inventory. Whereas an auto broker will search through several dealerships and auto brands to find all of the options that are best fit for you. 

A dealership can provide assistance with financing, with many dealers having their own financing office. However, a car broker helps with the entire buying process, including negotiating a good price and finding the most advantageous financing terms for you. 

Overall, a dealership may assist you with some parts of the buying process, but a broker can help you with the full car buying experience. Depending on your preferences in how you want to approach buying a car, you may find one choice making more sense than the other. 

Types of Auto Brokers

Although all auto brokers will provide the same service of helping you purchase a car, there are three different main types that you should be aware of if you are interested in working with a broker.

Car Broker (Auto Broker)

A car broker can come in the form of an individual, a small company, or an online-based service. They may be working for a dealership, exclusively for the customers, or both. Auto brokers are typically former car salespeople and dealers themselves, which gives them keen insight on these transactions. 

Bank Car-Buying Service

These are auto brokers who are employed by banks or credit unions. When a buyer is applying for an auto loan from their bank, the bank may offer their broker services to make the transaction more streamlined. A bank car-buying service will typically have pre-arranged pricing with the car dealerships, which also means they are unlikely to negotiate the lowest price possible.

Car-Buying Concierge

 From beginning to completion, a car-buying concierge will handle the enticing purchasing process for a buyer. Most often, they will charge buyers a flat fee, and also offer signing and delivery services.

Why Should You Hire an Auto Broker?

There may be a variety of reasons why someone who is interested in buying a car would hire an auto broker. Suppose you want to upgrade from your current car and trade it in for a new car. If you were to go to a dealership and trade it in by yourself, it’s very possible you could trade-in your car for too low of a price. Unless you have a lot of experience with cars and the current values of used cars, it’s going to be tough to come out on top against a car salesperson. An auto broker would be able to find the right dealership and use a refined approach that gives you the best return possible. This service, along with the selection and purchase of your new vehicle, shows incredible value in hiring an auto broker. 

What to Consider Before Hiring an Auto Broker

Before you start working with an auto broker, there are some important things to keep in mind that will help you avoid any surprises. It’s important to consider these aspects because many dealers have different payment structures and sometimes may not be impartial in what options they provide you. Here are key factors to remember before hiring an auto broker: 

  • Does the broker have a positive background? For any reputable auto broker, you can often find testimonials online written by past clients. If any broker develops a poor reputation, you can easily find out about it with some online research.             
  • Research on pricing can help. If you are able to familiarize yourself with the pricing of certain cars that you want, you can recognize if the broker is giving you a good deal or not. 
  • What kind of fees are charged by the broker? Auto brokers usually have a flat fee for each transaction. It’s best to avoid those who charge you additional fees based on what kind of car you choose to buy. 

Pros and Cons of Buying Services or Dealerships

Auto Broker


  • An auto broker can often find you the best deal for the car that you want. 
  • They will have the insider know-how and a network of different dealerships at their disposal that allows for a wide selection.


  • Depending on the broker, some may have a pre-arranged commission with certain dealerships. That means they earn a commission with every sale, so they are motivated to only show you cars from certain dealerships. 

Car Buying Services


  • These services can be added to the services you already pay for. You may already pay for a AAA or Costco membership, which also offers car-buying services. 
  • In some cases, you can find a better deal on a car than anywhere else.


  • Depending on the service, you might be on your own when it comes to going to the dealership for the test drive and signing the purchase. You could end up facing the pressure of additional add-ons that can drive your cost up much higher.



  • Dealerships can have their own seasonal discounts and financing specials that you cannot get with a broker or car-buying service. 
  • A wide selection of accessories and warranty options can help you get the most out of your car purchase, as opposed to a car that’s a stock default.


  • Many car dealerships may have a limited inventory to select from. If you have a specific car in mind, you might be disappointed by your options depending on which location you visit.
  • Pressure from salespeople. You could end up getting talked into buying upgrades that you would have otherwise never considered. 

Ready to Hit the Road?

While there are several different types of auto brokers, knowing what the differences are will play a big role in your success. Depending on a buyer’s objectives and what their situation is, they may need to be prudent when deciding if they want to work with a dealership or an auto broker. After you understand  what’s included in an auto broker service, the process of purchasing a car becomes much more approachable and you can decide your best course of action.If you are buying a used car or a new car, an auto broker can provide excellent value by finding the perfect car for you. Learn how you can find the right car for your needs by reaching out to Redline. All the guidance you need for purchasing your vehicle, from start to finish, can be found with us.. If your journey starts today, start with Redline!

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