Pay attention...by avoiding the mistakes
below, you can literally save thousands of dollars on your next
Purchasing new as opposed to pre-owned/used is a
New vehicles depreciate anywhere from $2,500 -
$6,000 the instant you drive them off the lot into the street.
Therefore, utilizing any auto loan on a new automobile purchase
will equate to you owing more than your car is worth
almost instantly (more commonly known as being 'upside-down'). A
new car does have lots of appeal. However, is said appeal worth
instantly losing all that money? We suggest that instead of
buying new, purchase the same make and model, just one year
older. Not only will you avoid the impact of the instant
depreciation associated with new cars, your purchase price will
be significantly cheaper and your car will also come with all
the warranty perks as a new car. Learn more about the
benefits of buying used.
Not doing your due diligence!
Nowadays, with the advancement of the Internet, car buyers have
an amazing amount of resources for doing research for a new or
used car purchase. Cars.com,
Kelly Blue Blook all
offer free info about all makes and models of new and used cars.
This includes owner ratings, pricing, features, reliability,
suggestions, and a whole lot more! Prior to even looking at
cars, a good idea would be to visit the above sites and compare
several different cars that fit in your price range, determine
what vehicle is best for you and your needs as well as what
price you should expect to pay.
Even more important is to make sure any car you are considering
buying has a clean vehicle history report. Eliminate the
possibility of buying a lemon or a car that has been in
accidents. You are going to want to take the VIN (vehicle
identification number) and run it through
Carfax's system. New
automobiles need to have their history's checked as well. You
don't know what happened in between the factory and the dealer.
It is also common for dealers to attempt to sell a used car as
new. In addition, new cars are always getting damaged by
hurricanes, floods, etc..
Don't get hustled by dealers and the
price of your car!
One of the biggest dealer hustles is for them to work off the amount you
want to spend each month for your car loan as opposed to what
you want to pay for your car. The dealer will compute your
payments with a really long loan term. The longer the rate, the
lower your monthly obligation will be but the more you are going
to pay for your car. For example, a $30,000 vehicle with a five
year loan term will have close to the same monthly payment as an
$18,500 auto with a three year loan term. The major difference
is going to be that you will wind up paying more than $3,000
additional in interest costs for the $30,000 vehicle. Some
people don't care and would rather pay more and get more car. A
good idea would be to ask for a complete breakdown as to what the
price of the vehicle is and what you can expect in terms of
monthly auto loan payments and total interest costs. Determine
much to spend on your car purchase.
Do not buy dealer add-ons!
Optional features that can be added to a vehicle are
called dealer add-ons. Some of the more common types of dealer add-ons include
stereos, alarms, window tinting, chrome tires, etc.. Dealer add-ons
are a tactic of adding overpriced features for the purpose of
increasing the final sale price of the car. It is important to
note that add-ons should not be considered investments for
increasing the cars worth since almost all add-ons do not add any
long-term worth to the automobile. In fact, add-ons can damage
the re-sale value of your car since your tastes may be unique
and not the same as the majority of consumers. We suggest that
if you are looking to tint your car, improve the stereo, etc. that
you research outside sources that can likely provide the same
service and merchandise for significantly less than the dealers.
Avoid dealer financing offers!
Car loans being offered by dealerships almost always
have a few extra points tied to them than if you were to obtain
your loan from your credit union or online lender. Therefore,
you should do some research prior to hitting the dealers to
see what types of rates are being offered and learn
how to get
the best auto loans rates. Obtaining a loan at
4% as opposed to 9% will save you a tremendous amount of money!
BUT, dealership financing can also be the best available deal
for you! If you have stellar credit, you may be able to take
advantage of those 0% offers you see on television all the time.
0% offers are difficult to qualify for, but if you do, you
should take advantage of them. Also, if you have poor credit and
are unable to achieve financing from any outside source, and the
dealer can get you approved, you will need to utilize them for
your financing. Therefore, to ensure you get the best deal for
your wallet, determine and assess all of your options prior to
selecting what type of financing you are going to proceed with.
more about the variety of auto loans for people of all good
and bad credit types.
Getting a Car Loan With No Credit