Car Buying Do’s and Don’ts: Be Prepared Before You Walk Into the Dealership.

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Although everyone enjoys owning a new car, buying a new car can sometimes be an overwhelming experience. We’ve compiled this list of car-buying dos and don’ts to help you improve your new-car shopping experience.

Do know what kind of vehicle you are shopping for! PenFed suggests you should educate yourself about the vehicles you’re interested in, and know what kinds of options and trim levels are available. Knowing the cost of each trim level, options and packages is very important because depending on the car, these add-ons can add up to the cost of a whole other new car. PenFed’s Car Buying Service is a great tool to price your vehicle because our pricing guides allow you to configure a vehicle you’re interested in buying by make/model/trim and down to the options and packages giving you an idea of what the final cost of the vehicle will be (subject to availability and based on dealer inventory).

Do your research ahead of time! To get the best possible price, you need to learn as much information about the vehicle you are shopping for before you ever enter the dealership. Consider several vehicles and research the accessories, features, and trim levels available on each one ahead of time, so you know what trim levels interest you, and which ones you would not want to pay extra for. Keep in mind that most vehicles are packaged according to specific trim levels, and can’t always be purchased to specific requirements without a special order.

subaru-legacy-epa-fuel-economy1Do know how much you can afford. Don’t shop for a luxury car if you’re living on a small-car budget. The rule of thumb when buying a new car is to put about 20 percent down, try not to borrow for more than four years (48 months), and keep your monthly payment lower than 10 percent of your income.

Don’t forget to factor in such things as fuel costs and annual maintenance. If you know your average commute, you can figure out in advance what you are likely to spend on gas by comparing your mileage to the EPA Fuel Economy Estimates on the window sticker.

Don’t base your purchase on monthly payments: instead consider the total purchase price after sales tax, and then evaluate the monthly cost. Once you know your total price, financing the car should cost about $20 a month for 60 months for every $1000 financed (for buyers with good credit), so keep that in mind when you’re looking at the bottom line.

Do contact your insurance agent to get an idea on rates ahead of time. It might seem backwards to check with your insurance agent before you actually purchase a new car, but if you knew the premiums were going to be sky-high for a certain vehicle, would you be inclined to choose a different vehicle or trim level? For example, you might discover a significant difference in the premium between the two- and four-door versions of a specific model, or that one trim level might cost less to insure than another. Would it affect your purchase?

Do check your credit rating in advance so you won’t be surprised by high rates when you reach financing. Before you walk onto a dealership lot and fall in love with a shiny new car, it’s important to know your credit score; otherwise, you risk the potential heartbreak of being told you don’t quality to finance your gorgeous new ride.

Don’t let your excitement over a specific vehicle make you a victim. Be prepared to walk away. There is no such thing as “now or never,” and it’s likely you can find a similar car on another dealer’s lot. If you don’t think you’re being treated well, leave and find another dealer. Be reasonable: the dealership needs to cover its costs and pay the salesperson’s commission, but if they’re not being fair to you, you will most certainly find another car on another lot on another day.

Don’t trade in a car that is worth less than you owe on it. When that happens, the balance of your old loan will be rolled into the new car’s loan amount, combining the debt of two cars into one, larger, loan.

Don’t talk about trade-ins until the end of your negotiation process. The price of the car should not be determined by the vehicle you have to trade in; consider that a separate transaction. Only after you settle on a purchase price should you start negotiating the terms of a potential trade.

Don’t forget that you can skip haggling altogether by using PenFed’s Car Buying Service. See how much money you can save on your car in your local area, and get PenFed’s outstanding rates at the same time. Check it out!

Posted in: Cars
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One comment on “Car Buying Do’s and Don’ts: Be Prepared Before You Walk Into the Dealership.
  1. Definite emphasis on knowing how much you can afford. It’s happened to me many a time when a pushy salesman has steered me onto a bigger or newer model, stretching my budget way out of the water. Don’t be afraid to say you want to leave, have a think and come back to it at a later date.

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