Here are the steps, know your shopping style, narrow down your shopping list, calculate a price you can afford, research, know when the price is right, leasing vs. Buy, find financing, guarantees and insurance, sell or exchange your current vehicle. Founded in 1976, Bankrate has a long history of helping people make smart financial decisions. We have maintained this reputation for more than four decades by demystifying the financial decision-making process and giving people confidence in what steps to take next.
The key to a successful purchase is to first determine how much you can afford. Your credit score, monthly income, and the type of car you want should be factored into this decision. The key is to find a balance between adjusting to your budget and finding a car that is right for your needs. The down payment for your future vehicle is the initial lump sum you pay for it.
Try to cover at least 20% of the purchase price, which may take some time. If you can't wait, you can make a lower down payment. However, you may not get a good rate with your lender. In this case, consider a less expensive vehicle.
The less you pay overall, the less you need to save for a down payment. If you plan to get a loan through the dealership, you'll definitely want your most recent paystubs. Ask if the dealer also wants you to fill out any online forms in advance. If you don't have a good credit score, you can also bring a list of references that can answer for you, some recent utility bills in your name to prove your current address.
You'll probably need proof of insurance when buying a new car. After all, it's mandatory in most states. Speed up the buying process and avoid dealership delays by calling your insurance agent beforehand. Ask them how you can prepare to remove your old vehicle and add your new vehicle to your policy.
Be sure to also bring your current proof of insurance card to the dealership. If you plan to get a loan through the dealership, you may be asked to show proof of your recent employment. Bring a couple of your most recent pay stubs just in case. It's best to aim for an aggressive repayment program to keep up with depreciation.
Try to pay for new cars in 60 months and do your best to target around 36 months for used cars. State and local taxes and registration fees will not be negotiable. Taken together, these costs can add up to approximately 10 percent of the total cost of your car. The first step in the process should be to research each and every car model that interests you.
In the beginning, you need to cast a wide net and look at as many car brands and styles as possible. Many buyers are surprised to discover suitable vehicles in brand selections that they would otherwise never have considered before. After launching your initial network quite wide, narrow your search down to a short list of just a handful of vehicles, maybe 3 at most. It's quite common for people to prioritize car features over pure aesthetics or brand recognition.
The ideal approach is to reflect on how a car's features benefit your particular lifestyle. For example, if you have long trips to work and high annual mileage, fuel efficiency is the most important thing. If you have a large family, lots of children's bags, sports equipment and other daily luggage, then cargo space is important, etc. While some choose to take a risk with the dealer for a financial deal, others first get an auto loan pre-approved by a bank or credit union.
This way, they can set a budget cap that helps them negotiate without straying beyond the boundaries of affordability. You should also research and get insurance policy quotes for your pre-selected cars that you could accept when the time comes and make your decision. Most new cars have a defense-to-defense warranty that covers at least three years and 36,000 miles, along with a powertrain warranty that typically lasts up to 60,000 miles. The powertrain warranty covers all parts that make the car drivable, such as the engine, transmission and suspension.
Here are our 10 steps to buying a car. Many automotive sites and car buying apps have a car search tool to help you identify strong candidates, as well as detailed rankings and research guides. It also allows car buyers to focus on negotiating a good price for a vehicle and making the car-buying process less stressful, reports the Consumer Financial Protection Bureau. If you're going to change your current vehicle when you buy your new car, you'll need a little extra paperwork and preparation to make sure everything goes well.
This step is vital to saving money and giving you control when choosing the best financing option available. While the dealer will be able to get your credit score and history, verify it yourself, review it, and take it with you when you plan to buy your car. Buying a new car can be a daunting process, from trying to get the best deal to avoiding unwanted upsells. There are other costs involved in buying a car, including financing charges and optional add-ons that should be considered, such as extended warranties.
Since they are more likely to buy the car with financing or a lease agreement, the buyer realistically calculates how much they can afford each month. If you moved in the past year, you'll need to provide proof of current residence to purchase a car. It's a good idea to really mark how you plan to pay for the car before you go to the dealership to buy a vehicle. You can really save money if you arm yourself with what you should know when buying a car from a dealership and you can save yourself a bundle by doing so.
To avoid common car-buying mistakes in today's market, there are some proven steps you'll want to take, such as determining how much you can spend, what car you want to buy, and the true market value (what other people are paying) for that car in your area. But trust is based on preparation, so take some time before going online or to a dealership to understand the key steps you need to take when buying your first car. . .