Purchasing a vehicle is one of your most important financial decisions. It’s a significant investment that requires careful consideration. Comparison shopping is essential for such a large purchase, because no one wants to find out they have overpaid after signing on the bottom line!
The first step in the vehicle buying process is deciding on your budget. Analyze your income and expenses to figure out what kind of monthly payment you can afford. When constructing your budget, consider the costs of insurance, maintenance, and gas, as well as up front costs like registration or warranties.
Begin this part of the process early, so that you can save money for a down payment. There are many auto loan calculators online that can help you compare different down payments and loan terms. There are even loan calculating smartphone apps that you can use while you are out car shopping.
You will often get a better deal, and have a more pleasant buying experience, if you secure a pre-approval for an auto loan through your bank or credit union. Many dealerships have finance departments that can help you secure a loan, but you may get a better rate by using a lender you have a previous relationship with, or the same institution that handles your mortgage.
Be sure to check your credit report and correct any errors on it before applying for an auto loan. Next, make a list of the features that are most important to you in a new vehicle. Consider who the primary drivers and passengers will be and how the vehicle will be used. Decide what features are most important to you, and what features might be nice, but are truly optional.
Use independent sources to compare the fuel economy, safety, performance, and maintenance requirements of different makes, models, and years. Sources like Consumer Reports rank car models according to different criteria and collect the results of comparative tests as well as user reviews.
Once you have selected a couple of models that will fit your needs, a critical part of your car buying process is figuring out what a fair price for the vehicle is before you head to the dealer. One powerful comparison shopping tool available online is TrueCar, a platform that connects car buyers with a network of 6,000 certified car dealers to help consumers compare prices across a wide range of sellers and against what other buyers in their area paid for similar vehicles.
Buyers receive an online price estimate that they can then take to a local certified dealer, where a trained sales professional completes their purchase. Online price comparison services like these help car buyers expect a fair price and experience no-haggle car buying.
The car buying process can be involved. Investing time in making an informed decision will help ensure that the car you end up with is the car you really want.
Understand your finances, choose the car that best fits your needs, and buy smarter by comparing prices. Following these steps will ensure that you drive away happy with your purchase!