Buying a demo car
Demo cars are the vehicles dealerships use for customer test drives and sometimes employee commutes. They're often popular models that dealers may sell to interested buyers when inventory is low. Because demo cars typically have a few hundred to a few thousand miles on them, you may be able to purchase one for less than what you'd pay for a brand new car of the same make and model.
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Should you buy a demo car?
Whether buying a demo car is right for you depends on your budget, the condition of the vehicle, and other available inventory. There are pros and cons to buying a demo car:
Pros of buying a demo car
- Lower cost: You may be able to buy a demo car for less than what you would spend on a brand-new car of the same make and model.
- Availability: Demo cars are often popular models in short supply. If your heart is set on a specific vehicle, purchasing a demo car may be the only way to get one.
- Rebates and special financing: Demo cars are considered new because they've never been sold or registered, so they may still qualify for new-car rebates as well as special financing.
- Less fees: The dealer may cover fees on a demo car that you often pay out of your own pocket when you buy a new car, such as shipping and freight, and pre-delivery inspection fees.
Cons of buying a demo car
- Mileage: Demo cars usually have a few hundred to a few thousand miles on them.
- Wear and tear: Because customers and employees drive demo cars, they may have some wear and tear like dents or scratches to the car that a new car wouldn't.
- Lesser warranty: Most manufacturer warranties are good for a certain number of miles. When you buy a demo car, the vehicle's miles get applied to the warranty. For example, if the warranty is good for 60,000 miles, and you purchase a demo car with 3,500 miles on it, the warranty will be good for another 56,500 miles. Learn more about car warranties and extended car warranties.
- Features: If you opt for a demo car, you don't get to choose the trim level, paint color, or other features you want on the vehicle. You buy it as is.
How does buying a demo car impact insurance?
Your rate for auto insurance on a demo car is calculated the same way as with any other vehicle. Vehicles with low safety ratings, high repair or replacement costs, and a propensity for accidents are more expensive to insure, on average. Find out more information about how a vehicle's make and model impacts your rate for car insurance.
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