The decision to buy a new car often accompanies positive life changes; graduating from college, having a baby, or receiving a promotion are all great reasons to upgrade to a new vehicle. However, you must be careful to avoid these five mistakes that could put a damper on this exciting time in your life.
- Deciding too quickly
You see it there on the lot: your dream car. The perfect vehicle. It has everything you want, and for a great price, too! However, this vehicular fairytale can be dangerous. Car salesmen will try to convince you that they have the best deal you could possibly get, but chances are they’re lying. You can always negotiate. Bargain and haggle hard, and don’t settle until you’re satisfied with the price.
- Using dealer financing
Obtain a loan for a new car from a bank or other trusted source, not from the car dealership. The amount you’d pay in interest could possibly buy you another car; dealer premiums are often high-interest with harsh penalties for missing a payment, so avoid them at all costs. Get preapproved from another source before you begin shopping.
- Skipping the test drive
Even if you feel that there is nothing wrong with a car, take it for a test drive. Make sure everything is in working order and that it like the way it feels; the moment you buy a car, it depreciates in value. There are no returns. Take it for a drive on the open highway and through heavy traffic, testing out the brakes, steering, and all other relevant features.
- Negotiating in person
The dealership is the salesman’s home turf. Do your comparison shopping online and find out where you can get the best deal. Keep an eye on the average price for the model you are looking for. If you can negotiate over the phone or through email, you remain in control of the conversation, rather than running the risk of being caught up in a salesman’s charisma and charm.
- Buying "because you can"
Just because you can afford a $500 per month car payment doesn’t mean you should. Shop conservatively; find a car that suits you, even if it is under your estimated price. This just means you can put down more money towards the initial payment and have it paid off sooner.
Purchasing a car is a big decision and an even bigger commitment. Payments will come out of your bank account each month, so make sure you are smart when you make the purchase. If at any point during the transaction you feel like you are being cheated, question the salesman. Negotiate the price down or walk away. You are in no way obligated to make a purchase.