As much as everybody loves owning a new car, sometimes shopping for one can be a little intimidating. Here are some tips to ensure your new-car buying experience goes smoothly.
Do your research online ahead of time. Before you even go to the dealership, learn as much as you can about the car you're interested in buying, including its features and trim levels. Knowing the cost of each trim level, as well as additional options and packages, will help you narrow down what features you want and how much you are willing to pay for them.
Do know how much you can afford. The rule of thumb when buying a new car is to put about 20 percent down, try not to finance for more than four years (48 months), and keep your monthly payment below 10 percent of your income. Remember to account for car insurance and fuel expenses, as well; especially when gas prices are high or if the car you're shopping for is considered an insurance risk.
Do run your credit report ahead of time and prequalify for a loan with your own bank or credit union. This helps you know exactly how much car you can afford, and allows you some flexibility to choose between your bank's or the dealership's financing offer.
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. Save the trade-in until the end of your purchase process; determining the value of your used car is a separate transaction from finalizing the price of your new car.
Don't base your purchase solely on monthly payment. Instead consider the total purchase price after sales tax and fees, and then evaluate the monthly cost. Focusing on only the monthly payment might add more months to the life of the loan–increasing the long-term financing costs.
Want to reduce the amount of time you spend in the dealership and save on your next car? At O.co Cars, you can see what others paid for the car you want, see all available incentives, and get a price and your guaranteed savings off MSRP (see site for details) from multiple local dealers. You'll no longer have to drive from dealer to dealer and you can be confident you?re getting a good deal.
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