Should I buy a rental car?

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In a Nutshell

If you want to buy a rental car from a rental car company or public car auction, be sure to consider the potential benefits and risks first. You may be able to get a newer-model used car at well below market value. But the vehicle’s wear and tear could make it difficult to sell or trade in down the road.

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Buying a rental car may allow you to buy a newer-model vehicle at a reduced price, but you’ll want to carefully weigh the pros and cons before you buy one.

Each year, large car rental companies like Avis, Enterprise and Hertz put thousands of rental cars on the market as they prepare to refresh their fleets with newer models.

You might have concerns about a rental vehicle’s mileage or how well it’s been maintained. But buying a rental car could come with benefits that outweigh some of the drawbacks.


Who sells rental cars?

Well-known car rental brands like Avis, Enterprise and Hertz provide a couple of ways to find rental cars for sale. You can typically browse and shop their inventories online or head to each rental agency in person to check out available vehicles. In some states, Hertz Car Sales even delivers your new car to your home.

Car rental companies may also provide auto financing if you don’t have the cash on hand to buy the car outright. But it’s always a good idea to shop around and compare auto loans.

As part of your car-loan shopping, consider applying for preapproval. If you’re preapproved, you’ll know how much you’re conditionally approved to borrow and what your estimated interest rate and loan term will be before you buy. This can make it easier to stick to a budget and allows you to shop like a cash buyer. Note that even if you get preapproved for a car loan, you’ll need to submit a final loan application to know if you’re approved.

If you don’t find what you’re looking for with a rental agency, some public car auctions and dealerships offer rental cars for sale.

Is it a bad idea to buy a rental car?

It might make sense for you to buy a rental car, but you’ll need to consider several factors, including your financial situation and your vehicle needs and preferences. Here are some potential benefits and drawbacks of buying a rental vehicle.

Pro: Rental cars are priced below market

Buying a rental car may help you save some cash — rental cars tend to be priced below their fair market values. And as an extra bonus, some rental companies offer no-haggle pricing which can remove the stress of negotiation.

Once you find a car you’re interested in, use a pricing tool like Kelley Blue Book or Edmunds to see its estimated fair market value. This can help you determine whether the rental car’s purchase price is a good deal.

Con: Rental cars can have high mileage

According to the U.S. Department of Transportation’s Federal Highway Administration, drivers typically rack up an average of about 13,500 miles per year. Even though rental companies tend to sell newer vehicles, these cars often come with higher-than-average mileage.

Since mileage can be a major factor in depreciation, this could affect the vehicle’s resale value down the road when you’re ready to sell or trade in the car. And if you get a loan to buy a rental car, you may even end up upside down on your loan. If you find yourself owing more on your car than it’s worth, you’ll most likely have two choices: continue making regular loan payments or sell the vehicle and pay off the rest of the loan.

Con: Rental cars have more wear and tear

The former rental car you’re considering may be a newer model, but it has probably already had many different drivers. Renters may not be as careful with a rental car as they are with their own vehicles, or they might have different driving styles.

Pro: Rental cars are well-maintained and clean

You can typically expect that a rental car has been regularly maintained, serviced, cleaned and inspected by the rental company and its certified mechanics. It may even come with a limited powertrain warranty that can provide some added protection.

Avis and Hertz even let you test drive the vehicle for a few days. These companies encourage you to have your own mechanic inspect the car for your own peace of mind, which is a good idea any time you’re considering buying a used car.

Con: Limited inventory

When you buy from a rental company, you’re limited to the cars it’s selling. Although you may find that the company offers many makes and models, you won’t be able to “build” a car from scratch or customize it with add-on features like you can with a new-car dealership. And in some cases, the make or model you have your heart set on may not be available in your area.


What’s next?

Whether you should buy a rental car or not comes down to your individual needs. If you have a particular make, model or feature in mind, or if you want a car with low mileage, you may not be able to find exactly what you’re looking for at a rental company. And if you plan to sell or trade in the car in the future, its lower resale value could be a challenge.

But if you’re looking for a newer car at a competitive price, buying a rental car may be a good option. Just make sure you get a vehicle history report on any rental car you’re considering. Take advantage of test drive options, and get the car inspected by a trusted mechanic before deciding which car is best for you.