New Car? Used Car? Red Car? Blue Car!

Now that you’ve decided another car, new-to-you, is in your future, the next thing to decide is whether you’ll be purchasing New or Used.  Obviously, a new car does not come with the kind of history that used cars do, but you must be careful about scheduled maintenance and mileage to stay within your warranty.  Ebay and out-of-state dealerships are shipping nationally, so that broadens a lot of your used car choices.  See what locals say about their shop, and read reviews if you decide to purchase online.

 Whatever decision you make, remember that once you take ownership of those keys, you are taking ownership of that ride!  It’s true that it’s good to know a car’s history, but this is personal.  Your butt is going to be planted in that seat, logging lots of driving time.  You’ll want to know for sure what kind of ride you can expect before you buy it.  Do your research, and have it checked out by a trusted mechanic.

 Still Can’t Decide?

There is a mathematical formula at Edmunds.com to calculate your estimated yearly auto expenses will be.

Used car buying tips:

Before searching for used cars, consider how long the owner has had the car. The most important thing about buying a used car is that its important to know everything about the history of the car, including the number of previous owners, whether the car was ever involved in an accident, any previous mechanical problems, and the maintenance history of the car. Someone with mechanical knowledge should check out the car, if possible.  Check that the motor, transmission and other major parts of the used car are in fine working condition. You should also inquire about oil changes, the age of the battery, tune-ups and when the tires were last replaced.

There is a wide range of models, brands and colors available for the purchaser to buy a used car. You can often find great bargains by researching used cars for sale online, and then driving to see the car in person. To begin the search, check in the local car classifieds or with pre-owned car classified websites that offer great deals of used cars for sale. Surf car classifieds and use online resources to narrow the search for used cars being offered by individual sellers. There are many opportunities to compare cars on the Internet and car buyers are using these options to the fullest.

Buying a New Car: Have a plan.

Do the research.  It’s easy.  Know exactly what vehicle you want and which options.  Price it on Edmonds or KBB Search!  Add 3% to invoice and that should be a fair deal for any dealer. Unless its the hot car of the moment, then it will be more.  If you can find out how many cars are in supply, this will help your price.  If there are 180 days’ supply of a certain car, the will deal no problem.  But a new model, just hitting the floor will have much less wiggle room.

Try and buy something that has been out for a year.  Look at the problems people have had with them.  Corvettes had ignition lock problems in the late 90’s.  Let someone else find and work out the bugs for you.

Call the bank, or Credit Union, meet with a lender, personally.  They will be on your side and discuss payments and such and interest rates without pressure.  They can track your credit score and you can ask questions galore.  Maybe you thought you wanted the $35,000 Wrangler, now the $25,000 dollar Mazda looks better?  Don’t forget Tag and Taxes!

Ask friends what dealer they use if they have the car you want.  Call that dealer and ask for the guy that has been there the longest and make an appointment to see him, unless you have a referral to another salesman.  It is never wise to show up onto the lot and get “Pot Luck Pete, the guy who started 2 weeks ago and has one car sold, maybe.

The old guy will not be out on the lot, seeking customers.  He can make his own deals without the Manager.  This is the guy to find.  By making an appointment, you immediately bypass everyone that runs up to a car when they arrive at the Dealer.  Just say you are there to meet so and so.  They will leave you alone, or good sales people will take you right to his office.  If he has what you want, go look at it.  Look at the sticker.  Look for add-on options.  You do not want to pay for dealer added options, as it is an overpriced profit for them.  If there is list of stuff, your job is harder, and you might have to order the car.  They will make more cars.  This isn’t the only one!

There should be no extra sticker price, at all, really.  The most you may want to negotiate over is floor mats.  Look the car over checking specifically for paint and dent issues.  Test drive and listen with the radio off.  Don’t talk, and let the salesman do his job.  Towards the end of drive, ask him how close to invoice he can get.  This is neutral territory (not his office) and he will tell you what he thinks.

Do the deal and get the floor mats thrown in for free.  Tell him you really don’t want the Finance & Insurance guy to sell you anything and you have financing, etc.  There may be no way out, but try.

Keep in mind, if you are still not sure at this point, stop and go to lunch or dinner or come back the next day.  He sells 30 cars a month, you buy one every 6 years!   This is a big step.  Take it easy on yourself.

If you have to go to Finance and Insurance, HOLD ON TO YOUR WALLET!  Practice saying no, because you will say it more times than your name.  If there wasn’t a list on the car with dealer added-on options, this is where they will tell you what you really should have, too.  Paint sealant: No.  Fabric Protect: No.  Paintless Dent repair- only 29 dollars a month more: No.  Gap Insurance: No. Credit Life: No.  If you have 4% rate from the Credit Union, the F&I guy may get you a better rate, listen up.  He will make 1% on whatever rate he gives you.  So if he can do 3%, he is getting the dealer at least 1% of that loan money.  You will also become fodder for their loan system and offers will come at you for years to come as they sell your info, too.

One last thing to note:

WARRANTY:  All of this is priced out in plans from factory to dealer.  This means that the price is negotiable, just like the price of the car.  And always make sure it is the factory extended plan, not a third party.  Warranty prices can be found online. Tell them no, even if you want it.  Sometimes they offer a free loaner car if you buy their warranty, try for that.

All new cars sold have a period where buying the extended warranty can be done within a reasonable time – 30 days, at least, with no extra charge, sometimes a year.  If you are going to keep the car 10 years, a warranty might be a good thing, but why pay $3,000 dollars for a plan that may be purchased later for $1,800?

When you get the car home, search forums for your vehicle.  Look at topics for warranties and what people paid for them.  A GM dealer in the Midwest may sell the exact same warranty to someone in NJ for 40% less.  Also, other dealers that sell the same car might make a better deal.  This can be done on the telephone and they will need a VIN.  Lastly, call your F&I guy and see if he will meet your price.

If you do their financing, read over the contract!  A friend of mine had the F&I guy print out same contract 3 different times with 3 different interest rates!

Best tip:  If you do not like what is going on, stop.  Leave if you must.  Don’t get angry.  They will not want you to go and there are always other dealers.  

Don’t be intimidated!  Knowledge is Power!