What is an Auto Broker?

One alternative to buying a car from a dealer is using an automobile broker. Brokers act as intermediaries between you and the dealer. They contact dealers directly and come back to you with the best price. Often, their price will beat what you could get yourself from a dealer, since brokers have the leverage of buying large numbers of cars every year.

Brokers come in several varieties. They range from American Automobile Association (AAA) affiliates to used car dealers who become brokers of new vehicles as a sideline.

Some brokers act solely as a referral service, putting you in touch with the dealer who offers the lowest price. In return, the broker receives either a commission from the dealer or a fee from the customer.

Other brokers will find the car you want at a franchised dealer, formally take title to the car, and then sell it to you. Because these brokers are licensed as new-car dealers, the car is still a new car when you buy it. A handful of brokers buy cars in advance and display them in warehouse-type showrooms.