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Educational Consumer Tips

Buying a New Car

Author: Rachel Gelb
Category: Auto

Buying a new car is the second biggest purchase, after a home, a consumer will make in their lifetime. Consumers spend a number of hours in their cars commuting to work, running errands, and driving to visit family. It is important that you purchase a car from a reliable dealership based on your needs. Researching will help you to find a dependable vehicle and allow you to negotiate on an agreeable price.

Tips for Buying a New Car:

Create a Budget.  Before searching for a new car, decide on an appropriate budget you will be able to spend. Factor in the cost of the car, the down payment, any loans, taxes, and fees. This will provide an idea of the maximum price to spend when negotiating with the dealer. Determine whether buying or leasing the car provides the best value for your money. A lease offers lower monthly payments, little money upfront, and restricted mileage. At the end of the lease the car is returned and the process is repeated. Buying a car requires monthly payments and more money upfront, but once the loan is paid off you own the car.  

Choose a Car Model.  Ask yourself what options are needed in a new car. Is four-wheel drive needed, how many passengers, what safety features are desired, and will the car be used for long trips? Answering these questions will narrow down the options to a car that is best suited towards you or your family’s specific needs.

Compare Prices Online.  Look up the prices of different cars online at Kelley Blue Book and Edmunds. By doing a side by side comparison of a few models, you can see what each car has to offer for what price. It is important to know the difference between the invoice price (the price the dealer paid for the car) and the sticker price of the car (the desired price the dealer wants you to pay).

Choose a Dealership.  Ask friends and family members for dealerships they trust that provided a pleasant experience. Check out a dealership at for its Accreditation standing, ratings, reviews, and complaints. The dealer should not be pushy, rather they should make you feel comfortable and informed with all of the available options.  

Take a Test Drive.  Test drive the car according to the conditions the car will be driven in once the car is purchased.  If possible, drive through traffic, on the highway and on backroads. Turn off the radio when test driving to listen to any sounds the engine makes and carefully evaluate its features.  Don’t forget to test all controls and accessories. Always use your instinct. Since it is a large purchase be confident in the car you choose.

Negotiate With the Dealer.  Use the invoice price to bargain. This will get the dealer to sell the car for the lowest price they can while still making their needed profit. If another dealership has offered a lower price go to the original dealer and ask if they can make a better offer. Be patient when purchasing a new car. If the first or second offers are not desirable, you must be able to walk away.

Trade in the Old Car.  Only discuss trading in your old car after the price of the new car has been negotiated.  Before trading in your car, research the value on Kelley Blue Book or Edmunds. Make sure the dealer is not offering a low price on the new car because they are not giving the appropriate value for the trade-in.  

Sign the Contract.  Understand all components of the contract.  Know what the warranty will cover.  The salesperson will try to sell extra items, it is best to turn these down or negotiate the price. Double check that all costs are correct and have the salesperson breakdown all of the items listed before signing the contract.

About the Author: Rachel Gelb is Communications and Marketing Manager for BBB serving Eastern Massachusetts, Maine, Rhode Island and Vermont. Find Rachel on Google +.

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