Handy Car Buying Tips
Thinking about getting a new vehicle? Here are a few tips on how to get a good deal and how to avoid some common financial mishaps along the way.
Research, research, research!
Arm yourself with knowledge before you hit the dealership. If you have a particular vehicle in mind, there are several internet sites that can give you an idea on what a good deal looks like. Check several of them (Cargurus.com; KBB.com; TrueCar.com; Edmunds.com) so you can see what they’re selling for in your area and use this information in your negotiations.
Have a clear budget in mind
Make sure you know what you can pay and stick with it! Many dealerships will ask how much you can spend or what you want your payment to be and will then use this information to adjust or extend your loan repayment terms which may not be advantageous to you. A much better option is to meet with one of our bankers to secure an auto loan with the exact terms you want ahead of time to give you control and leverage over the dealership.
Buy a ‘slightly used’ vehicle
As soon as you drive a new car off the dealership’s lot it is considered a “used car” and, as such, the vehicle’s value drops immediately, sometimes by as much as 15-20%. Skip this immediate depreciation hit by buying a low mileage used car with 2-3 years on it. Some of the best used car deals come from leased cars being returned to the dealership, and most have been regularly maintained per the terms of the lease contract.
Don’t focus on one vehicle
Even if you know exactly which vehicle you want, keep this information to yourself and instead negotiate on 2 or 3 vehicles that might work for you. Use the other vehicles in your negotiations to get the best deal you can on each one, and then make your final selection.
Skip the dealership add-on’s
Don’t fall for the many extras the dealership adds to the cost of the vehicle unless you really want them. Examples like rust-proofing, clear-coating, VIN etching and window tinting are typically added by the dealership at high margins and are not necessary. If you don’t want the option, tell them to deduct it from the price of the car. If they refuse to do that, see what they will offer as a concession, or go to another dealership.