When you look on the Internet for new-car buying tips, there is universal agreement on what the first or second step should be: Obtain pre-approved financing from a credit union or bank. This article will take you through some steps that you should consider before buying a new car. If you are smart, diligent and do your research, you could potentially save thousands of dollars!
Starting the car buying process by getting pre-approval from a credit union or bank will give you the parameters of what you can afford. Driving a Lamborghini sounds like a wonderful idea, but it isn’t a practical or realistic purchase option for 99.9% of American car buyers. But, by working with your financial institution at the beginning of your search, you’ll have a much better understanding of what kind of car you can comfortably afford.
If you are a member of Truliant, you can make an appointment to visit a branch and speak with one of our financial experts. After looking at your finances – monthly salaries, debts, other obligations and credit score – Truliant will offer pre-approval for the maximum that you will be able to spend on a new car.
With a firm amount that you can spend, now you can start the fun part: shopping for a new car.
Start with research
Cars are everywhere. It’s easy to discover a few that you like and also meet your needs. Once you have two or three models in mind, the next step is to turn to the Internet. You can research features, reviews, recalls, prices, insurance costs and safety issues. If you’re not interested in doing a deep dive online, another great place to start is with the annual auto issue of Consumer Reports – an independent source of consumer product information.
The magazine, which hits newsstands each April, provides reviews of all makes and models of cars, trucks and SUVs, and gives a comprehensive list of their recommended new car buys for each year.
Besides understanding the best car for your needs and budget, solid research puts you in a much better position to negotiate with a salesperson. According to AutoMD.com, the average person buys a car every 10 years. Without some extra preparation, buyers may not know all of the pricing, features, warranties, etc., and will be at a disadvantage when working with a dealership. A car salesperson knows what the dealership “invoice” price was for the car, and not just the manufacturer suggested retail price (MSRP), and they know the value of “extras” on each vehicle on the lot, giving them a much better negotiating point to begin from.
However, by doing your homework, you can improve your odds of getting a good deal on your new vehicle.
This is a key piece of information. It’s much easier to find the MSRP, but the invoice price will tell you what the dealer paid the manufacturer for the car. Several websites – Edmunds.com, KBB.com and NADA.com – have tools that will help you obtain this number. Once you have this price, it becomes your “basement” – or your starting point – when negotiating with a dealer.
Time to shop
One nice advantage of shopping for a new car – versus a used car – is that multiple dealers will have access to the “same” new car. Their lot availability in terms of colors and some features may vary, but the basic car is the same. With so much available inventory, you as the buyer have the advantage of being able to walk away from a dealer – refusing their offer if you don’t like the terms – because you know there are other dealerships that have the same car. This also gives you the ability to get exactly the car you want – at the price you want – as you know you can work with multiple dealers in your area.
Always take a test drive
Most people – 90% – drive a car before they purchase. Make sure you are one of them when shopping for a new car. There is important information to be gained at this point in the process:
• How comfortable are you in the car while driving?
• How are the views through the front, back and side mirrors?
• Are the controls on the dashboard easy to use?
• How does the car handle during acceleration and braking?
• Finally, if you have kids, take them. This will give you a good idea about the vehicle’s accessibility.
Don’t forget about the trade in
It’s also important to factor in your trade in when shopping for a new car – and do your research on the car’s value before you go to the dealership. Sites such as KBB.com will allow you to input your car’s make and model, mileage, features and overall condition to give you an accurate range to expect for a trade in. This information can be critical to helping you get the maximum value for your can and can reduce what you pay for your new one.
Truliant can help
Truliant has a variety of vehicle loan options and services that are available to all members – all at competitive rates. Please call us at 855.293.2957 to speak with one of our representatives or you can make an appointment to visit one of our branches. You can also visit Truliant.org/AutoLoans to schedule an appointment, get more information or apply online, anytime.