purchase a car

How To Confidently Purchase A Car

I know the sound of approaching a car dealership is overwhelming, but it is something we all have to face if we ever want to purchase a car. You might be uncertain with the buying process, or think you don’t know the proper information. Or even worse, knowing that the salespeople are taking advantage of you. Have no fear ladies! You’re in control. With investigation and preparation, you can approach a car purchase with ease. Here’s a how-to guide for buying a great car, talking to salespeople, and showing them you mean business.

Tips To Follow That Will Help You Purchase A Car

Nab a notebook

Designate a notebook for documenting the process. Label it “Tips On How To Purchase A Car” to better organize yourself. It isn’t easy to remember details. Maintaining a record of each step will keep you organized.

 

Make a list of must-haves

Think in terms of practicality rather than pizzazz. Bear in mind not only the present but also future needs. Be sure to list all the items you want. Heated seats, on-board vacuum, all wheel drive. Writing these down will remind you when discussing terms with a salesperson.

 

Cozy up with your calculator

Before you purchase a car, it is vital to pinpoint the price you can afford. There are three amounts to consider:

1. Down Payment- This is the money you will pay out of pocket via cash, a trade-in, or both.

2. Monthly Payment- To calculate the amount, follow this sequence by Consumer Reports:

Figure out 36% of your gross monthly income. Total you monthly expenses. Subtract this amount from your 36% figure. The balance is the monthly payment you can reasonably afford.

3. Loan Amount.

Determine the number of years you are willing to make payment and the current interest rate. To obtain this, contact your bank or credit union, or visit bankrate.com

Calculating the down payment, monthly payment, and loan amount will give you the price you can manage. Then you will need to add sales tax, registration fees, and insurance premiums. Contact your insurance agent to find out what your premium will be on autos you are considering. Knowing what amount you want to pay, and how to pay it before approaching a dealership will help you to discuss payments with the salesperson and the exact amount you can afford. But bear in mind, do not discuss payments until the dealership has proven they are worthy of your investment.

 

Apply for a pre-approved loan

Depending on how you want to pay, you might want to be pre-approved for a loan. Loan pre-qualification enables you to go to a dealer with a check for a specific amount. You can then compare this with dealer financing and choose the best deal. To acquire a pre-approved loan, contact your local bank, credit union, or auto insurance company.

 

Know your credit score

A dealer can say you do not qualify for a prime rate due to low credit score. To avoid this, know your score beforehand. You can obtain free copies of your credit report from www.annualcreditreport.com. For exact scores, order reports directly from Equifax, Experian, and TransUnion for a small fee.

 

Assess the value of your trade-in

If you have a trade-in, you’ll want to know it’s value before you purchase a car. You can obtain a Black Book appraisal at newcars.com. Submit your auto make and model, condition and features, and contact information. You will receive an estimate of the price range at which your vehicle is valued. Bring this with you when discussing payments with the salesperson.

 

Beware of dealer games

Studies show that some dealers practice price discrimination. They may give women price quotes that are 40% higher than those rendered to men. Salespeople can readily identify women who aren’t well-informed. But luckily for you, you are a very well-informed woman! Sidestep the following tricks of the trade:

Bait and Switch- You are treated like a fish with this tactic. You’re reeled into a showroom with a tempting bait only to be switched to a higher-priced version of the offer. It could be a low advertised price, dollars-off coupon, free feature, or trade-in value. But, once you’ve made you decision and are about to sign the paperwork, you’re told that the offer has changed or expired. This obviously makes you mad, but you just fantasized about that car and are pretty determined in owning it. That is the whole point behind bait and switch. Stand your ground and remember, car salespeople need your business.

Finance Schemes- A finance manager earns a commission based on how much you pay. You may be introduced to this person early in the negotiation phase. Watch for an offer of a lower price with a corresponding increase in financing. As a counter move, tell the salesperson you’ll meet with the manager later, after receiving their best price. You can even inform them that you are shopping around for the best loan agreement.

Padding- Salespeople may push you to purchase add-ons or pay additional fees. This practice increases their commissions. According to MSN Money, you should pass on the following snags…

  • Features: Extended warranty, fabric paint, wheel protection, rustproofing or undercoating, VIN etching.
  • Fees: Advertising charge, credit insurance, customer service fee. Along with dealer prep, document preparation fee, delivery charge, and loan acquisition fee.

Pricing Pitfall- The “4-Square Method” is a ruse to confuse you. Salespeople will illustrate the components of a transaction in a form, divided into four sections. These represent the down payment, monthly payment, trade-in value, and purchase price. After you’ve marked your consent, the form is taken to a back office where a manager changes the numbers. Then you and the salesperson haggle over all the figures except the price, which won’t be shown to you. The salesperson will shift your attention among three of the boxes, distracting you from the fourth one, the final price. You’ll end up agreeing to the negotiated changes, as well as that hidden price. You can avoid this by keeping your eyes on the paperwork.

Conditional Offers- Lastly, be on your guard when you hear a salesperson say, “I have to check with my manager.” A conditional offer is likely forthcoming. An example is when a sales rep returns, saying “my manager has authorized me to include floor mats and a cargo cover if you commit to buying now.” A manager may put pressure on you to force a decision. Stay cool as a cucumber and stand your ground. If you don’t want to purchase right away, then walk away!

 

Study the contract

Carefully examine the paperwork to make sure all verbal agreements are in writing. Be sure the financing and price are not inflated above the original terms. Take loan paperwork home and read it before signing. If a salesperson refuses to allow this, tell them you won’t complete the deal.

 

Pick up the vehicle

The last tip to help you purchase a car is to pick your car up from the dealership. Check the car to ensure all promised features are present and intended work has been done. Make sure any dealer financing is finalized. If you see the words “contingent” or “conditional” do not accept the terms. They could change later, putting you in a bind. Also, check your gas tank. You should drive away on a full tank. They just got your business didn’t they? Good dealerships should end every car purchase with a full tank and a happy customer.

Following the above steps will make your trip to the dealership much more satisfying. And always remember to drive a hard bargain. Use your womanly wits to your best advantage. Do the above research, stand your ground, and follow these tips the next time you think about purchasing a car. You’ll be the queen of the car-buying scene. And remember, they need your business!

 

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