Car buying is, or ought to be, a calculated decision. A new car is a major purchase, one that can be fraught with mistakes should you don•t research your options ahead of time. Prior to you heading to the showroom, make certain you•re prepared.
Top 9 car-buying mistakes
Buying a car can be a tricky process; to get the best deal, avoid these common pitfalls.
1. Buying the wrong vehicle
It•s rarely smart to purchase a car solely according to its price or available rebates. When the vehicle is not good quality, or does not meet your way of life needs, then it•s not a classic good deal and will likely cost you more income in the long run.
“Getting a great deal starts with picking the right vehicle to begin with – one that matches your lifestyle, budget and personality,” says LeeAnn Shattuck, creator of The Car Chick website and Car Chick TV.
How to avoid: Research vehicles online before setting foot on a car sales lot and create a thorough knowledge of what you need, are able to afford and could be happy driving. Websites like Edmunds and Consumer Reports make it simple to compare vehicles and see vehicle quality and reliability ratings, and a loans calculator will help you evaluate monthly costs.
2. Mixing your feelings as well as your money
If you fall in love with an automobile, don•t overreact; instead, give yourself serious amounts of relax and ensure that it•s really the car for you. In short, don•t enable your heart rule your head, as doing this could cost you.
“Every decision we humans make is definitely an emotional one, whether we understand it or otherwise,” says Shattuck. “But a car can also be the second priciest purchase many people will make in their life, so an emotional decision will set you back money.”
Also, keep a grasp in your budget. If you can afford $20,000 and also the object of the affection lists for $30,000, negotiation probably won•t cut down more than, say, $3,000.
If the automobile you would like is out of your budget, consider purchasing a gently used type of exactly the same car instead, Shattuck says. It•s usually easier to purchase a used model of a car which has a history of quality and reliability rather than buy a new type of another vehicle which may be less reliable.
How to avoid: Never purchase a car impulsively or even the same day you test-drive it; instead, have a couple of days to rest on it. It•s also a wise decision to look around at multiple dealers and compare quotes. Prior to you making your final choice, look at all of the numbers in the security of your own home, where you can create a more rational, analytical decision.
3. Selecting a dealer by location
Dealers aren't all the same, not even for the similar exact car makes and models. Many people begin (and end) their car shopping in the dealer nearest their home or office. Yet choosing a dealership based solely on convenience can cost you money and create a bad car-buying experience.
Instead of sticking with the dealer nearest home, check around, study from friends• experiences and research each dealer•s Customer Satisfaction Index (CSI) score. These scores are developed according to customer feedback and satisfaction and are used by auto manufacturers to stay abreast of how good dealerships are handling the sales process. What•s more, a dealership•s CSI scores lead to the inventory they receive from a manufacturer. Dealers with the best CSI scores have a tendency to get the most widely used vehicles from auto makers.
You can also check a dealership•s complaint record with the Bbb.
How to avoid: Before setting out to test-drive cars, investigate the dealers in your area. Check out their websites and browse reviews to find a dealership with a decent reputation.
4. Talking trade-in too early
Don•t jump in too fast when it comes to trade-in chatter. Evaluate the true value of your car before mentioning trade-ins.
“Most dealerships prefer to negotiate the sale cost of a car and also the shopper•s trade-in price simultaneously. Doing this can add confusion to the process, and shoppers rarely benefit,” says Matt Smith, deputy editor of CarGurus. Negotiate a satisfactory price for that new car first, then bring up your trade-in afterward.
How to avoid: Savvy shoppers will request to negotiate the sale cost of their potential purchase first, then talk trade-in.
5. Going alone when you need a helping hand
If negotiation tactics are outside your wheelhouse, transform it over to a car broker or consider purchasing through a service like the AAA Endorsed Auto Buying Program, which nets members special pricing through authorized dealers.
“Whether you•re a first-time car buyer, you•re uncomfortable with the negotiating process, or you simply realize that you•re an impulse buyer who needs anyone to refuse for you, it•s ok to people for assistance with car shopping,” says Shattuck. “It•s a significant purchase, so it•s important to make a good decision and also to get a good deal.”
How to prevent: Bring a friend or relative who•s knowledgeable and comfortable using the car-buying process and can be your advocate, or consider getting a professional. Some car-buying services offer discounted pricing on vehicles through dealers in your town, and others offer more personalized service that can help you thru the whole selection and purchasing process.
6. Forgetting that it•s not over before the paperwork is signed
You might think that you•ve bought your vehicle once the sales director shakes your hand and lets you know exactly what a good deal you simply got. But watch out for the business office, known as the finance office. The finance manager•s job is to sell you soft add-on products, such as extended warranties, wheel protection, interior protection and more.
Dealers often make just as much profit this room because they do around the showroom floor. Dealer add-ons, late charges, insurance and rate of interest changes tend to sneak up on you once the signatures begin.
“Each product on their own doesn•t seem expensive however these add-on products can substantially boost the price of the automobile,” says Scarlett Steuart, lemon law attorney with Burdge Law Office.
How to prevent: Keep your budget in mind when entering the finance manager•s office. And don't forget, it's perfectly okay to consider a break from this final step in to go run the numbers by yourself and ensure that you•re still in a position to pay the vehicle with any add-on products.
7. Being afraid just to walk away
Many shoppers make the mistake of feeling like they need to close the offer the day they enter a dealership. The truth, however, is that shoppers who keep their options open and visit multiple dealerships before making your final decision have been in a far better negotiating position. Looking around may ultimately make you feel more comfortable walking away if a deal goes poorly. Additionally, if you can show a car salesperson another vehicles you•re considering, you should use those alternatives to strengthen your negotiating position.
How to avoid: When searching for an automobile to purchase, do not settle on only one option. Instead, identify as many as 2 or 3 are eco-friendly that fit your needs and budget.
8. Letting the dealership determine your purchase financing
For many car buyers, financing • or how you will pay for the vehicle purchase • is something they leave towards the dealership. However, dealerships might not provide you with the best deal on an auto loan. While it•s convenient to let another person get quotes for you, the casino dealer may present you with higher rates of interest than you could find by yourself. Higher interest rates might cost you 1000s of dollars over the lifetime of the loan.
How to prevent: Look around for automotive loans with banks an internet-based lenders that provide competitive car loan rates for the credit range before going into the dealership. If a dealer can beat the best rate you•ve identified, then great. Otherwise, you•ve saved a little money.
9. Forgetting that it•s not only the sticker price
The sticker price you see on the showroom floor isn•t the end-all of the purchase. In reality, that price is only a jumping-off point for you or perhaps your trusted negotiator to lower your final cost. Known as the manufacturer•s suggested retail price (MSRP), it's simply a suggestion the salesperson follows.
Also keep in mind that your final price might be greater than the MSRP should you include add-ons, fees and much more. Some of these costs may not be negotiable, and dealerships might be less willing to negotiate on MSRP when the vehicle is brand-new.
How to prevent: The MSRP is a good benchmark for how to start your negotiations. The vehicle dealer is expecting you to push for any price decrease, so remain steadfast in haggling for that price that is best for you.
How to better get ready for buying a car
Car buying can be an exciting and emotional process. But obtaining the best deal and also the the most suitable vehicle for the lifestyle, needs and budget requires removing emotions from the process whenever possible, whilst arming yourself with plenty of information and research.
Before putting the important thing within the ignition, consider multiple vehicle options, research reviews of dealerships and compare quotes from auto loan lenders. The greater information you have when you need it when doing test drives, the greater.