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Car Buying Tips

Car Buying Tips - Page 3

• Should you buy this years model or last years model? If you plan to keep the vehicle for only a couple of years, you will probably be better off with this years model. You will pay more for the new model, but 2 or 3 years down the line it will have a substantially higher resale value than last years model. But, if you plan to keep the car 8 or 10 years, then last years model may be a better bet. You will pay a lower price for last years model and 10 years from now the difference in resale value between the new model and last years model will be small. The best decision depends on how much less you can pay for last years model than for this years model and whether this years model has new features that are important to you.
• Be cautious of Buy Here, Pay Here car lots. If you decide to buy a car from a used car lot, be sure to read all of the papers before you sign, and don't sign contracts that allow the dealership to change the finance rate AFTER you leave the lot.
• Call your insurance company first to make sure they will insure the car you are thinking of buying and also for a price quote what coverage will cost you for the new car.
• Never leave a deposit without getting proof of receipt stating full return of the deposit if the deal falls through.
• If you are going to finance a loan through the car dealership, discuss the financing AFTER you have set a price (in writing) for the car, and always read the fine print of the loan contract.
• You do not have to buy the Life Insurance (in case you die) or Disability Insurance or the Extended Warranty on the car as a condition of getting a car loan. Insert N/A (not applied) or put a cross through any blanks not applied to you.

• Watch out for 0 percent financing and no payments for a year. When your payments do begin, your car will have depreciated in value even more, which doesn't match up to the amount you still owe.
• You should consider buying Gap Insurance. Buy Gap Insurance through your auto insurance agent. Gap Insurance is less expensive through your auto insurance than the car dealership.
• Make your payments on time. Late or missed payments incur late fees, appear on your credit report and impact your ability to get credit in the future. Be aware that repossession (the creditor takes possession of your vehicle) can occur if you fail to make timely payments. It does not relieve you of your obligation to pay for the vehicle. The law in some states allows the creditor or assignee (bank, finance company or credit union) to repossess your vehicle without going to court. Talk to your creditor or assignee if you experience difficulties making your monthly payments to see if a repayment schedule can be worked out.
• If the dealer won't negotiate on price, leave. There are many more dealerships down the road.
• If you are buying a car based on the invoice price, and freight is already included in that price, make sure freight isn't added again to the sales contract.
• Negotiate, negotiate, negotiate.

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