How to Purchase a Car

Buying a car can be very daunting if you aren’t prepared. Here are some tips to make sure you’re successful.

1. Do your Research
   • Knowledge is power. Utilize the internet to research cars in your price range.
   • Use trusted websites such as Kelley Blue Book (KBB), Consumer Reports, or Auto Trader.
   • Look into Pre-Financing Options
   • Check with your bank or credit union because most of the time, their interest rates are lower than dealerships.
   • Get your quote in writing and present it to the dealership to negotiate.
   • Shop Around and Negotiate Terms
   • It’s important to shop around before you settle on a purchase price. Dealerships price their vehicles differently depending upon their location. Visit a few different dealerships to get the best quote.
   • Negotiate the purchase price down and be prepared to walk away.
   • Start with a ridiculous number and work backwards.
   • Buy based on purchase price, not your monthly payment.
2. Look at New and Used Cars
   • New cars depreciate considerably the moment they are taken home from the dealership.
   • Always test drive your vehicle before your purchase.
   • If you’re planning to buy a used vehicle, it’s important to have the car thoroughly checked out by a mechanic before you finalize the purchase. The mechanic will inspect the car and look for unusual signs of wear and tear as well as items of potential concern.
3. Don’t Purchase Unnecessary Add-ons or Warranties
   • VIN etching and a dealership maintenance plan are add-ons that you don’t really need.
   • If you purchase an extended warranty, pay cash for it to avoid interest fees.
   • If you’re leasing a car, don’t buy any warranties because you’re going to turn the car back in at the end of the lease.
4. Insurance
   • Make sure to obtain a quote from your insurance agent on the car you’re looking to purchase. Feel free to shop around for the best quote.
   • You have to be able to afford the car with the insurance payment. Keep in mind; sports cars have higher premiums than conventional cars.

Author Rich Heinrich,

Master Instructor, Emeritus