Get pre-approved for a loan before you set foot on a dealership lot. Keep it simple at the dealership. Don't buy any add-ons in the. A better way to do this, Reed says, is a five-year loan for a new car and with a used car you should finance it for only three years, that is, 36 months.
One reason that makes sense, he says, is that if your used car breaks down and it's not worth fixing, let's say the transmission goes completely, you're more likely to have repaid the loan by that time. The easiest and most economical way to buy a car is to buy it directly with cash. Buying a car directly from an owner can be one of the best ways to buy a car. However, there are a few things to keep in mind.
After you've established your budget and determined the type of property that's right for your driving habits, start researching the vehicles that have caught your eye. First, visit car manufacturers' websites and independent automotive information sites to evaluate the features that are important to you. Consider MSRPs (Manufacturer's Suggested Retail Prices) and invoice prices. Next, check the local inventory listings to see what's available in your area.
Many car manufacturers offer discounts to students, members of the military, and even members of certain credit unions. These discounts can be cumulated and combined with any model cash back, which must be deducted after negotiating the price. Check the automaker's website for these incentives before entering. When it's time to sit down and talk about pricing, be prepared with the research you've done.
Check to see if other dealers offer better deals for your vehicle and look for a price match with your seller. If you want to change your current car, save that conversation for after negotiating the sale price of your new car. Having those conversations separately will help you get a better deal on your current car, and you'll do even better if you've researched the value of your current car online. Lower monthly payments and little or no down payment can make car leasing seem like a great deal.
The truth is that leasing offers convenience, but only if you're willing to endure restrictions. Rental restrictions include mileage limits of 12,000 miles per year or sometimes 10,000 miles per year, diligent vehicle maintenance and care, and, in some cases, early termination penalties. You are a good candidate for leasing if you prefer to have a new car every few years and put limited miles on your car. Another advantage for some is when you can cancel your car lease as a business expense.
If you want a lease simply to reduce the amount of your monthly payment, consider that it may be beyond your realistic ability to make payments. Try to think seriously about selecting a less expensive vehicle, if that's the case. Buying a car for the first time can be a daunting prospect at first, but taking a methodical and strategic approach will pay off for all the years you own your car.