Buying your first car is a rite of passage for any young adult. But as exciting as this transitional period may seem, it’s fraught with potential pitfalls.
It’s never easy to buy a car, whether it’s your first time or the twentieth. After all, there’s a lot of money on the line. Without the right advice, you could pay too much for a vehicle or end up buying one with serious mechanical problems.
Don’t get taken for a ride. Here are 7 essential things every first-time car buyer should know.
1. Research Is Everything
The process of buying your first car starts way before you arrive at the dealership. Research is essential when it comes to landing a fair deal and choosing a make and model worth its price.
What sort of details are you looking for? As far as models are concerned, you’ll want to know the fuel economy and reliability. Once you’ve located a few attractive options, head to Kelley Blue Book to discover their fair market price.
It’s not just about cars, either. You’ll want to choose reliable and well-rated car lots once you set out for your first vehicle. Take the time to find the best dealership near you.
2. The End of the Month Is the Best Time to Buy
Many dealerships, if not all, enforce a sales quota for all their workers. This could go month to month, quarter to quarter, or year to year.
You can take advantage of this situation by shopping for a vehicle near the end of these timeframes. Salespeople will be more likely to sell you the car for less if it means making a sale. This is even more useful for the first-time car buyer since you have limited negotiating experience.
3. Deny Expensive Add-Ons
So you bought the car. Great! You should know that the dealership will try to convince you to sign up for some of their add-ons.
These usually come in the form of service warranties or upgrades. It’s okay to say no. In fact, you should deny most if not all of these add-ons, as you can get the same services from other venues for less.
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That said, sometimes dealerships do have a system in place to automatically register your vehicle and get you a license plate right away. For some, it’s worth the price.
4. Have a Third-Party Inspect the Vehicle
You took the vehicle for a test drive and love it. The problem is, you’re not sure if everything is in good condition under the hood. Since the dealership is trying to make a sale, you can’t trust that they’re being entirely truthful.
Thankfully, you can get the car inspected from an independent mechanic of your choice. They’ll let you know if everything is in great shape after the inspection. If it’s all clear, then you can proceed with the purchase.
Are there red flags? Pursue a different vehicle. Or better yet, search for a different dealership since they may not be as trustworthy as you’d like.
5. You Don’t Have to Get a Loan From the Dealer
During the final sale, you’ll have to get an auto loan to make the official purchase. Most dealerships have their own lenders available. They’ll ask you to go through their lender as they get a cut of the proceeds.
It may be convenient just to go with their retained lending institution. But the momentary convenience will cost you. It’s oftentimes cheaper to grab a loan through your own lender.
In fact, your current bank likely offers auto loans. Bring their number along with you to the dealership. As long as you’re pre-approved, you can easily finalize the sale by grabbing a loan with a quick phone call.
6. Leasing is the Most Expensive Way to Own a Car
You have two options when it comes to “owning” a vehicle. The traditional method is to buy it yourself with the help of an auto loan. However, leasing may tempt you with its promise of drastically lowering your monthly car payments by up to 60%.
If you’re buying a car for the first time, the prospect of paying less is tantalizing. Unfortunately, leasing is actually the most expensive way to own a car.
That’s because you don’t “own” the vehicle. You’re paying to borrow it. At the end of the lease, you’ll have to return the car to the dealership or take out another loan to extend its duration.
Although buying a car is more expensive on a per month basis, you’ll start cultivating huge savings once you’ve paid off the loan. If you go with the leasing option, you’ll be making payments in perpetuity.
7. It’s Okay to Walk Away
Of all the tips for first-time car buyers, this is the most important: It’s okay to walk away. You’ve found the car of your dreams, tested it, and inspected it. Now you’re at the negotiating table, but something isn’t sitting right with you.
Maybe you’re uncomfortable with the current price, or you feel the salesperson is pushing something on you. Whatever the case may be, always trust your gut.
You can get up and walk away before signing any paperwork. It’s their job to pressure you into a sale. Don’t let them push you into something you’re not comfortable with.
It’s your money.
Finding Success as a First-Time Car Buyer
It’s easy to become overwhelmed as a first-time car buyer. Many dealerships would try and use your inexperience against you. But with these 7 tips in your toolbox, you’re prepared to stand your ground and get the best car at the best price.
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