First-Time Car Buying

12:42 PM, Sep 02, 2020

An active lifestyle depends on motivation and efficiency. Car ownership may be the next big step to provide you with the lifestyle you deserve. With many makes and models to consider, it is normal to experience uncertainty when buying a new car but establishing a budget alongside your transportation needs can help ensure you make the best purchase possible.

1. Establish a Realistic Budget—Cars cost more than the asking price. Typical expenses include annual fees such as car insurance and registration, maintenance, and fuel costs. A realistic budget accounts for all of this on a monthly basis. When selecting a car, establishing the overall price and expenses into a monthly breakdown of costs will narrow your options and keep you safely within your budget.

2. Determine Your Needs—Transportation needs vary on an individual basis. Maybe you would love a truck to haul your furniture for next month’s move, but it would remain idle the rest of the year. Take an inventory of your primary needs. Realistically, a car that serves your day-to-day lifestyle will be the best option.

3. Identify Your Wants—This may sound contrary to the previous suggestion, but a car is an investment that will serve you for years to come. As long as it remains in your budget, a car should satisfy your individual taste. Buyer’s remorse shouldn’t leave you unhappy for the next several years. Assess your spending to identify any expenses, such as restaurants or Friday night Happy Hours, that you’re willing to forego to buy the car you really want.

4. Do Your Research—Spend time doing online research to compare and contrast similar makes and models. Discovering that the car you really like has terrible reviews can save you from making a huge mistake. You may find a comparable model with better reviews. Ask someone you trust, or even a stranger, who drives a specific make and model about their experience. Use this information along with your gut instinct to determine which car is most suitable for you.

5. Test-Drive—Spend at least thirty minutes test-driving the car. This will give you ample time to assess the car’s features, response, and comfort. Include stoplights and freeway time so you have an idea of how it maneuvers under various speed conditions. Note whether or not the car’s visibility, control panel, and other variables feel comfortable while driving. Time should be at the buyer’s discretion. If the sales rep doesn’t have thirty minutes, schedule to test-drive another day, or find another dealership.

6. Determine the Proper Purchase Price—Price-gouging and sale commissions can send a buyer down an uncomfortable path. The Kelly Blue Book Fair Purchase Price gives you an indication of typical prices for similar cars in your area. When discussing the purchase price, don’t reveal your monthly payment budget, and wager below what you’re willing to pay. You can easily offer $20,000 for a $25,000 car and work up from there.

7. Secure Your Financing—Bank loans vs. dealership loans can make or break your financial goals. If you lack a credit history, or have marginal credit, it is best to talk to your credit union, bank, or insurance provider in advance about financing your car. Many dealerships offer loan programs, but you never want to act like they’re the only loan option available. When you walk into the dealership with a firm price and a pre-approved loan, you decrease the chances of being haggled out of your comfort zone.

8. Enjoy the Buying Process— When you’ve done the work of establishing a realistic budget and understanding your daily transportation needs, car-buying should be an exciting experience. Cars are a lifestyle, and you deserve the make and model that enhances your individuality. Reward yourself. With realistic financial goals armed to suit your lifestyle, you will feel confident when you drive off the lot.

When you’ve done your research, test driven your dream car and have decided it’s time to put the pedal to the metal make sure you’re all set to go with an auto loan from First Security Bank. Give our Consumer Lenders a call at 406-728-3115.

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