Read these 14 New Car Tips tips to make your life smarter, better, faster and wiser. Each tip is approved by our Editors and created by expert writers so great we call them Gurus. LifeTips is the place to go when you need to know about Car Buying tips and hundreds of other topics.
According to Bankrate.com, used cars outsell new cars three to one (probably because used cars run about half the cost of a new car). Both new cars and used cars have their pros and cons. If you are just starting to shop for a car and you aren't sure whether you want new or used, visit Bankrate.com and use the auto advisor interactive tool for guidance.
Bankrate.com asks you a handful of questions and, based upon your answers, makes a recommendation as to whether you would do better buying new or used. Bankrate.com has pages upon pages of information. If you can't locate the auto advisor easily using the navigational menus, simply search on the term "new vs. used car," and select the first item in the search results.
It's easy to find a new car review on just about any make and model you like. You can turn to the Internet to find reviews at sites such as AutoWeek's, Car and Driver, Epinions, Motor Trend, and Road and Track.
If you'd rather have something in your hands that you can mark up with comments and questions, you can pick up a car buying guide at your local book store.
Consumer Reports, a publication of the Consumers Union (a nonprofit organization devoted to providing unbiased reviews of consumer products to the public) publishes an annual new car buying guide that is chock full of good advice on negotiating the best deal, financing, and reviews.
The best way to negotiate with a dealer over the price of a new car deal is to first determine how much the dealer paid for the car or the invoice price.
Instead of negotiating the retail price to buy the new car, bargain using the dealer's invoice price. The dealer's price is usually below invoice of the retail price.
Let's say that you have a new car deal on a Saturn Sky and $1500 was marked
off the retail price. However, the car dealership's invoice price is $3000 less than the new car's retail price.
Solution: Determine the dealer's invoice price compare it to the new car's retail price. If there is more than a 50 percent discrepancy, either haggle a $200 to $300 or walk away from the new car deal.
When you take a new car for a test drive, take your time. Don't let the salesperson rush you. A thorough test drive should take at least 20 minutes. During the test drive, make note of some important things, such as:
• How does the car fit you?
• Can you adjust it comfortably?
• Can you reach and adjust all controls easily?
• Is there enough legroom for passengers?
• Does the car accelerate fast enough for you?
• Is the level of interior noise acceptable?
• How does the car handle when you round tight corners quickly or shift lanes abruptly on the highway?
• How does the car responding to hard braking?
• How is the ride quality?
• Are you being jolted when you pass over the slightest bump?
You should test drive several cars in the same class to give yourself something to compare each car's performance to. Chances are, any new car you test drive will be an improvement over your old car, but that's not a fair or rational benchmark.
If you can help it, don't buy a new car or a used car under duress. Try to plan your purchase in advance so you can take your time finding the right car for your needs and budget.
The Federal Trade Commission's booklet "Understanding Vehicle Financing" is a good resource whether you are a first-time car buy or have a car collector. The free downloadable PDF version is available at the Federal Citizen Information Center's Web site. In it, you'll read about how to get the facts on dealership financing, including what it is, how you apply, special financing offers, and cash back and rebates you may be eligible for.
*You can also order a copy of the 10-page print version from the Web site for $1.00.
*If you are looking for new car reviews, check out NewCarTestDrive.com.
NewCarTestDrive.com claims to be the world's leading provider of automotive reviews. While that may or may not be true, the site does include reviews of most major makes and models of both new and used cars, plus a host of other terrific information and tools (including a car quote service, a car comparison tool, and tips and advice on financing and insurance).
When the interest rates are low, it is better to buy a new car; however, when interest rates are high, savvy auto consumers prefer car leasing to avoid hefty interest financing fees. Consumers lease new cars for two reasons:
• To be under warranty without having to worry about serious maintenance repairs
• The ability to drive a fully-loaded luxurious vehicle without making the long term commitment of a regular new car purchase
Any new car sold in the United States is required to post vehicle information on a side window. The details are designed to disclose specific manufacturing and price data regarding the vehicle. The document is a window sticker referred to as a Monroney sticker. Although the law applies to automobiles, it is not applicable to light trucks, the vast majority of sport-utility vehicles (SUVs) and passenger vans. However, here four add-on stickers generated by auto dealers to boost their sales commission:
- Additional Dealer Profit (ADP)
- Currency Valuation Fee
- Import Tariff
- Market Value Adjustment (MVA)
When negotiating a new car deal, be sure to base the negotiated price of a new car on the deducted cost of the ADP and MVA because they are superfluous charges. As for the Currency Valuation Fee and Import Tariff, these are dealer created charges that depict unsavory sales tactics.
If you're in the market for a new car, but you aren't sure if you want a Chrysler 300 or a Pontiac Solstice, check out the new car comparison tools at any of the reputable car pricing Web sites.
Kelley Blue Book's Web site lets you compare data on up to four different vehicles, including pricing, general information, powertrain, safety ratings, crash test results, dimensions, warranty, features, and specification. Other sites that offer similar comparison tools include Autosite.com, Edmunds.com, Intellichoice.com, and J.D. Power & Associates Web site.
Most auto consumers are drawn to car leasing because it means that they do not have to pay for the new car or finance it. With leasing, the consumer is paying for the cost to drive the vehicle for a period between two to six years. (The term of a new car lease varies from contract to contract).
To evaluate the cost effectiveness of a new car lease calculate the following:
• The total initial payment (includes the down payment (Capital Cost Reduction) and extra fees
• Monthly payment amount
• The number of months in the lease's term
• Any additional charges at the conclusion of the lease
Review a monthly Automotive Lease Guide because it will depict charts on the Residual Percentage Guide, detailing an approximated value on various car models. In other words, these charts identify which vehicles are forecasted to maintain the best value. As a result, new cars with low residual value are more apt to be costly because they will drastically depreciate upon the end of the lease. Try to avoid low residual value new car leases.
Next, calculate the cost of financing a new car, down payment, monthly payments and any maintenance requirements.
The next best alternative to buying a new car is the purchase of a certified pre-owned (CPO) automobile.
Since, certified pre-owned vehicles are marketed as the top echelon of used-cars, they are touted as “closely inspected” for maintenance problems. Many CPOs come with a warranty that extends coverage from three months to a specified term.
The window stickers pasted to new car windows are designed to provide consumers with an ample amount of information. With the exception of light trucks, passenger vans and most sport-utility vehicles (SUVs), new cars sold in the United States are required to post a window sticker called the Monroney sticker. The window sticker was named after the congressman who introduced the legislation.
The details of the Monroney sticker must include the following:
- The manufacturer's suggested retail price (MSRP) for the new car as well as all the factory-installed options
- A destination charge (the cost of shipping the new car from the final assembly point to your dealership's location) is added to the MSRP to calculate the total price
- Environmental Protection Agency (EPA) fuel economy estimates
- The vehicle's parts - content information
- Other information regarding a list of standards and extra/optional equipment
- The total price
To negotiate like a professional, use the above prices to calculate the dealer's invoice price and your discount.
If you are shopping for a new car deal, do not expect to pay for each charge on the window sticker.
While the details of the Monroney sticker are actual costs, many car dealerships add a second window sticker. It includes a list of accessories installed by the dealer, and other miscellaneous charges. The options and prices on the added sticker are deemed as negotiable and optional.
In example, if a dealership adds a paint sealant to a Saturn Sky, the consumer is not required to pay even though the sealant is already on the new car.
Sophisticated automobile shoppers will invest the time to shop around to buy a new car calculate a new car deal down to the dime. It can serve as negotiating leveraging power. Use these new car buying strategies to buy the new car you want for your dream price:
1. Be decisive. Buying a new car requires the tenacity to be decisive yet flexible enough for a little bending room. Narrow your list to two or three models that best suit your needs and income.
2. Do the research. Research the dealer invoice prices of the new car models you desire Remember to included the delivery charge in your price calculations.
3. Try to find new car deals with a manufacturer's rebate. Remember to include the deduction in your budget.
4. Obtain financing approval. Try to stay away from dealership financing because it may tack on excessive expenses.
5. Tests drive your favorite models and request a copy of the inspection or certified checklist.
6. Conduct your own background check on the car by asking for the Vehicle Identification Number (VIN) and running it through CarFax.com, vehicle-history-report.info, or another online car checking site.
7. Once the vehicle checks out, begin the negotiations.
8. Avoid any extras. Car dealers have a way of adding unnecessary extras such as fabric protector, paint sealant, rust-proofing, or theft protection.
9. Do not sign-off on any sales agreement with out reviewing the fine print.