Buying a car is perhaps as overwhelming and as buying your dream home. As expensive as it is many people still make costly mistakes that end up wreaking havoc in their finances. Remember if you are buying a car on a loan, you are probably going to pay for at least four or five years, you don’t want to commit to something that will cause you sleepless nights. The process of buying a car can sometimes be tricky—from a pushy, overbearing salesperson to grappling with high-interest loans and insurance, the entire process can be extremely frustrating. But since you’ll want to buy a car at some point, you will have to deal with all of these things. Fortunately, this article has been designed to give tips to people like you and help them avoid the amount of stress involved in a car purchase, save lots of money, and hopefully get the best deal.
Do Your Research
Since you already know that knowledge is power, it can be the worst mistake to walk into a car dealership without having some finder details about the car you are looking for. The internet is replete with information about just any car you want. From Edmunds to Consumer Reports and Kelley Blue Book, you have lots of sources of information that will be great places to start when comparing prices and car efficiency. It is also recommended to ask for the “invoice” price as opposed to the MSRP since this is the price the dealer paid for it. If you are planning to go for a used car, you want to be aware of the most current prices for the model. Having this ammunition in your arsenal will give you a headstart during the bargaining process. For those wanting to trade in, it is wise to find out the true resale value of your car to know if the trade-in makes financial sense. But first things first—ensure to bargain for the best prices before you slot in the aspect of the trade-in as this will make you reap the best.
Getting Your Car Loan
You can finance your car from your savings or look for a financier to help you buy your car. From finance companies to credit unions, banks, and car dealerships, there are many places you can seek help. However, not all of these places are good for you. While many people choose to finance from dealerships, this option often isn’t fiscally viable. Often, dealership interest rates are typically higher than ordinary bank financing or credit unions. Obtaining a car loan from your banker is perhaps the best option since you can access “relationship discounts” for being their customer. Being pre-approved for a loan by a financial institution is usually the best bargaining card you can flash when you approach a dealership since you can use it to negotiate a lower interest rate from the dealership. Speak to Awesome Car Loans for help getting pre-approved. However, you need to know your credit score upfront before you approach the bank for a loan. Remember credit ratings are crucial in determining auto loan rates dealerships will be willing to offer. If your credit score is below the desired one, it is advisable to boost it through making timely payments of your utility bills and clearing all your credit card debts.
Shop Around for the Best Price
Since you have already made up your mind to buy a car, you probably have been checking around for the best deal. Whether it is the car model, the best dealership with affordable prices, you certainly don’t want to settle on a deal that will make you pour your money down the drain. It can be tempting to spot a car you have been craving and want to buy it right away. You need to walk through several dealerships whether physical or online so you can compare prices. You will be surprised just how cheaper your dream car can be in your subsequent auto shops than the initial quotation you got from the first dealership. Unless you have an emergency, it is always advisable to shop around before you finally buy a car. It can make a lot of sense to visit out-of-town car dealerships, as the prices tend to vary significantly depending on where the dealer is located.
Negotiate for the Best Terms
Some people have equated buying a car to a chess game. Since it is a decision that comes with a huge financial implication, you’ve to let the dealership know upfront that you are out to get the best prices. You want to use all your skills to negotiate the car loan and try as much as possible to knock down the prices. Do this with confidence and hold onto your guns until you get the best.
Buying Insurance Coverage for Your Car
Insurance coverage is another mandatory requirement for any car owner. However, do not allow yourself to pay higher insurance costs, especially if you are buying a new car. Ordinarily, extended warranties from some of the dealerships are expensive, and even more, the coverage is not substantial enough to cover some of the mechanical issues you are likely to encounter. Therefore, it is good to avoid similar plans, after all, a new car comes with a manufacturer warranty that is enough to cover basic mechanical issues for your vehicle. You also want to avoid costly extended warranty plans, especially if they are included in the price of the loan. This is because the total cost of the warranty also attracts interests, hence the overall cost will be damn high
Buying a car is certainly a major decision you are going to face, and it is important to have information on virtually every aspect that goes with buying a car. Ensure to research and arm yourself with details before you walk into a bargaining room with a salesperson. By following the above tips, you can be sure your next car purchase won’t prove a headache.