We are in the market for a new car. I think we will opt for a SUV, but I have 1,000 questions before doing so. After getting recommendations from family and friends, I also did my research on what to do and not to do at the dealership. With these 5 steps to buying a new car, I am sure we will be better prepared for the day we walk onto the lot.
1. Narrow your selection
Do you know what type of vehicle you want? Are you looking for a car, truck or SUV? Maybe you need a van to fit your family members. Once you know the type, decide on the make and model. Research your options, looking for safety features and inventory in your area.
2. Decide if you’re going for new, used or will be leasing
The best value comes from a used car, though you will have a shorter warranty and won’t know the car’s full history. With a new car, you get the full warranty and lower interest rate, as well as free maintenance and roadside assistance.
3. Determine your budget
Make sure you can afford a new or used vehicle before you make a purchase. The average rule of thumb is to budget no more than 25% of your monthly household income for all of the car expenses within your household.
4. Nail down financing before visiting the dealer
A dealer possibly has two things in mind: selling you a car and making the car loan… both deals they typically receive a commission on. Rather than jump right to the dealer for the sale, nail down your financing from a bank or local credit union, then compare this to the offers at your dealership.
Dealers have a price point in mind, way before you hit the lot. Do your research and find out what that vehicle normally sells for in your area. Fair is the only answer for both parties. In the end, make sure you double check fees, making sure you aren’t paying for things you don’t want. And remember, it’s okay to say “no” to extra options. (You can always add them later!)