How to buy a car: 10 tips for getting the best deal
If you've been looking at a car at a local dealer for the past few months, or if your daily car has reached the final step, it's one of the best time to buy a car in a year.
In mid-December to late, salespeople are looking for clear extroversion and meeting end-of-year sales targets. This saves the buyer a lot of money. However, it is important to spend time researching and planning this major purchase.
Follow these 10 car tips to make sure your new car is affordable and well suited to serve you for many years.
1. Determine your budget
Although you may have confidence in a particular car, if you can't afford it, you can't take it home.
A good rule of thumb is to spend no more than 25% of your monthly family income on all your cars in your home. This number should include not only monthly car loans, but also all other car costs, including fuel and car insurance. According to Edmunds' senior consumer consulting editor Ron Montoya, your goal should be 15% for monthly payments.
If you are not sure how a new car fits your monthly expenses, use a bank rate home budget calculator to help you determine your monthly bill and the necessary savings.
2. Decide: Is the new, certified used car or used car? Buy or rent?
The choice between new or used depends ultimately on what you are looking for. Montoya said: "Used cars will obviously be cheaper, but you must pay attention to the situation. However, a new car, they are in good condition, but the price will be higher."
Also consider certified second-hand options. Montoya said: "Compared to ordinary used cars, these cars are usually better in shape, have less mileage, and have a service life of no more than 5 years."
If you buy a used car, you can buy the most cars with your money. However, your warranty period is short and you may not know the full history of the car. Also, if you have a car loan, you will pay a higher interest rate. If you rent a car, you may use your money to buy a more expensive car, but you will not own the car completely, you need to be careful about the terms of the lease to avoid huge fines. Buying a new car with the same money may be less useful, but you will also have a full warranty and pay a lower interest rate, and usually you will get free repairs and roadside assistance.
For many people, a certified used car is the ideal compromise because they are cheaper than new cars, but they usually have some warranty and must meet certain criteria to help ensure their reliability and condition. .
3. Narrow your choice to a few cars
Once you've determined your budget and the type of ownership you want, start researching the cars that catch your eye and see if they meet your criteria.
Visit the car manufacturer's website and an independent car information website to evaluate features that are important to you, and pay attention to MSRPS (manufacturer suggested retail price) and invoice price. Check your local inventory to see the available inventory in your area.
When you narrow down your choice to a few of the most important choices, don't rush to the dealer to test drive.
4. Assess your cost of ownership
Use your short list of cars and estimate the cost of ownership to determine if each one fits your budget. These should include gasoline, insurance, repair and maintenance. Auto research sites like Edmunds or Kelley Blue Book can provide a total cost of ownership in your area, but these numbers will vary depending on your individual circumstances.
For better accuracy, calculate your own fuel based on the number of miles you travel each year and get a car insurance quote that you think is appropriate for your home driver. Make sure you give the insurance agent an accurate model, including trim levels, engines, and sometimes some additional options to get an accurate quote.
5. Secure financing - before you visit the dealer
Dealers don't just want to sell you a car, they also want to coordinate car loans. This is because whether the loan is from a manufacturer or a local lender, they usually charge a flat fee or commission for a car loan.
As interest rates rise, many dealers offer lower promotional rates to top customers. If you are qualified, these are good ways to save, but you should still get a pre-approved loan offer before you go to the dealer. Montoya said that accepting the pre-approved proposal "is always a good idea", "just look at what kind of approval you can get, know what you can afford, and be able to compare interest rates."
You can find the current interest rate on the bank's interest rate. In addition, it should be verified with local banks (including credit cooperatives), which usually offer an average interest rate of one to two percentage points lower than traditional banks. Many community credit unions are open to anyone in their area and do not need to work in a company or industry to join.
6. Don't think that financing at a dealership is the best deal
Although you may be attracted to a car or a brand because you see low-interest ads, you have no use unless you qualify. These ultra-low advertising rates are particularly attractive as interest rates continue to rise.
However, only a small percentage of car buyers are eligible for low interest or zero interest rate deals offered by car manufacturers. Even if you are qualified, you can take the cash rebate of the car manufacturer and finance yourself at the bank or credit union.
To find the best deal for you, first determine the best rate you can get, then compare the car discount with the bank rate and the low interest rate calculator.
7. Get all pricing information
The research you do on the independent car website should include the invoice price (new car) or wholesale price (used car), as well as the manufacturer's suggested retail price (new car) or the dealer's asking price (used car).
Although invoice pricing on third-party websites is not 100% accurate, it is a good indicator for dealers to pay for car prices and is the best place to start negotiations. The goal is to agree on the sales price close to the number before using the discount, and remember that the dealer needs to earn at least a few hundred dollars in profits to pay the dealer's operating costs.
You will also need to ask the dealer for a detailed price quote. Montoya said: "Whenever you ask for a price quote for a car, you will be asked to list a breakdown of all expenses so that you can clearly see what is there." "If you don't know something Familiar, please feel free to ask. The typical fees you pay are sales tax, registration fee and documentation fee, which is the cost of the dealer's paperwork."
8. Study all possible discounts in advance
If the dealer promotes any cashback transaction, these rewards should be deducted again after you negotiate the price. Remember, many car manufacturers offer discounts to students, military personnel, and even members of certain credit unions. These discounts can be added together and combined with cash rebates on the model. Check out the car manufacturer's website for these incentives.
Check the calendar for additional savings. When a dealer organizes a large sales event, usually in the spring, fall, and year-end, you will see a large number of rental cars returning. Now is a good time to buy used cars and certified used cars, as dealers are in the process of renewing new vehicle deals and re-entering rental end models.
The upcoming model will be reduced to the lowest price at the end of the year, when dealers will seek to clear the new inventory and meet the end-of-year sales target.
9. Take a test drive slowly
Call your interested dealer and make an appointment for a test drive. If you decide to buy after you have a test drive, you can establish a relationship with someone who is unlikely to try to convince you to reach an agreement.
Montoya said that when you take the test drive, "you want to make sure that you drive the car you want." "Do your own investigation, don't always rely on sales people. Over the years, the car has changed so So big that they may not know anything about the car, so you want to conduct your own research ahead of time and use the sales staff to fill the gaps in the information you need."
Because most car buyers now take care of the car for five years or more, take a moment to test drive to make sure you really like the car. Don't hesitate, ask for more time behind the wheel to ensure your favorite driving experience, and spend time adjusting the seat while the car is parked, test control, and determine if the passenger is comfortable and your regular cargo is suitable.
10. Use a wise negotiation strategy
When you are ready to buy a car, don't think about trading with your old car for the time being. If you negotiate separately the sales price of the new car and the discount on the old car, you will live better. Make sure you've investigated the value of your current car online so you know when you're getting a fair price when discussing the discount.
