By Hometown Insurance
No matter who you are, when it comes to buying your first car, you’re going to have questions. Whether you are a recent graduate, starting your first real job, or someone whose hand-me-down car has finally failed; you will embark on the journey of buying a new car. The most important thing to do is to prepare yourself. The more prepared a person is, the easier the process will be.
Below we have created a list of our top ten tips for a first time car-buyer.
- Create a realistic budget
The budget created is typically based on how much you can afford to spend each month. Although cash is always king, many times in the world of car buying, financing is the true reality. When determining what payment you can make, take into account other expenses. For example, rent/mortgage, groceries, health insurance, and others. It is also important to consider auto expenses such as gas, car insurance, and maintenance.
- Know what you can afford to spend monthly
This might seem oddly similar to tip #10, but this is another piece of the financial puzzle. A persons level of “indebtedness” is different than their monthly financial commitments. If you’re financing, figure $25/month for every thousand dollars that you borrow for 48 months, and $20/month on 60-month financing. It follows that every $10K borrowed is $250/month for four years, and $200/month for five. This is the base of obligations: insurance, gas, and occasional maintenance are above this.
- What to do with your old car.
When it comes to your old car, there are many options for finding it a new home. Many individuals opt to sell their old car themselves, but you may also trade it in to a dealership. There are many websites and facilities that can help in your quest to offload your old vehicle (AutoTrader and Carmax).
- Measure your wants versus your needs
When buying your first car, being realistic can go a long way in finding something affordable. Make a list of things that are needed (i.e. power windows, power locks, power mirrors). Every vehicle has a different price, gas mileage, monthly parking fees (if applicable), and even different insurance costs. Once you figure out the must haves, then you can begin the search to find the car that is right for you. Although you have your set list of things that you need in your first car, it is okay to look for a car that might have some of your wants as well. If you have to shell out a few more dollars for a certain feature, and you can, then it might be a good idea. You don’t want to regret your brand new purchase and you’ll be using it for a while so you should have a few things for yourself. However, it is important to not stretch your budget too far.
- Do your research
Make sure to get the important details on the candidates for your new car. There are many reviews on the internet that provide details, opinions, and facts about the car that can be important when searching for a new one. Car dealerships can be very helpful, but they do want to sell cars and might not describe the car in a way that an online user might. Doing your research can even help you find the dealer that is right for you. There are many review websites that post reviews for the dealerships.
- Find your dealership
There are many car dealers that have the customer’s best interest at heart, but there are others who try and disguise a pebble as a diamond. You want to find a dealership that is close to home and that has a solid reputation. Having the dealership close to home will allow you to take advantage of the car care services the dealership has to offer.
- Test drive before you commit
Even though you may think that you have found the right car for you, it is still important to take a test drive. The test drive can change your perception of the car and you learn more about the car beyond the looks and reviews that attracted you to it. Take 30 minutes, and try the car out in similar conditions to your daily drive. Take the car out in regular stop and go traffic or cruise along the freeway to try and merge into traffic. When test driving the car make sure to adjust the seat, steering wheel, and mirrors so that it feels like it is your car and you can get a true feeling for how it would drive day to day.
- Decide the proper purchase price
Here you are; you’ve found the prefect car, test driven and come up with a budget that will work, now you need to decide the purchase price. Many lending institutions, such as a credit union, could help you find some perspective on the appropriate purchase price. Also, you should get a referral before talking with another salesperson because they often work on commission. When discussing your budget with the dealer, don’t let them know what your “per month” number is. For example, if the car is $25k give them an offer for $20k and work from there. It is easier to work the price up then to work that number back down.
- Secure financing, or know the options
There has been a large increase in the number of resources that allows customers to find financing. It is important to remember that items such as a low credit score or lack of credit history, can impact your options. As a customer, it is wise to have financing lined up prior to speaking with finance representatives from the dealership. This will allow you, the customer, to have more control of the situation. It is wise to speak with a credit union, bank or insurance provider beforehand to have your financing ready to go.
- Take pleasure in the process
Buying a new, or your first new car, can be a stressful process. However, you don’t do it often and next to a piece of property, this is one of your largest investments. This car will be the vehicle that you are driving everyday so it is important to make sure that it is something you want to be driving every day. This list can help you feel comfortable and confident in this process. This process should be fun and even those who have limited interest in cars can find joy in getting their first new car.
Call your Hometown Agent today at 1-800-568-SAVE (7283) or email email@example.com to discuss your auto insurance coverage options! We have discounts available for firefighters, EMTs and more!