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10 Steps to Buying a New Car |
The following is an overview of the
new-car buying process.
- How Much Of A Car Payment
Can You Afford? Begin by deciding how much you have to
spend on a new vehicle. Your monthly car payment should be no
more than 20 percent of your monthly net income.
- Will You Get A Car Loan Payment?
Decide whether to pay cash, finance or lease your new vehicle.
Each method offers different advantages for different budgets
and lifestyles.
- What is the Right Car for
You? What are your needs in regard to size, performance,
safety or styling? Research cars that meet your needs-and are
in your price range-by using multiple sources. Choose at least
three "target cars" to consider buying.
- Setting Your Price. Find the market value price for your target cars. Add the cost
of options and subtract rebates and incentives. This is a good
deal for you and a fair profit for the dealer.
- How to Test Drive a Car. Make an appointment to test-drive the cars you are interested
in. This is a chance to evaluate the salesperson too. Drive-then
leave!
- Should You Trade in Your Used
Car? A dealer will rarely pay what your trade-in is worth.
Still, some shoppers like the ease of a single transaction.
Here's how to do it.
- Beginning Negotiations. Be prepared to visit three or more dealers. Make your opening
offer several hundred dollars below the market value.
- Closing the Deal. Don't
let yourself be trapped by verbal games some salesmen play.
Raise your offer to market value but not above. If negotiations
stall, go to another dealer. Play the dealers against each other
until you get your price.
- In the Finance and Insurance
Room. You will move to the Finance and Insurance (F&I)
room to sign contracts. Review the contract carefully and avoid
high priced extras like rust-proofing, and road safety kits.
Check your new vehicle for scratches and dents before taking
delivery of it.
- Alternate Buying Strategies. Consider using Internet buying
services or faxing your offer to local dealerships for competitive
bids. This can save you money and avoid the hassle of going
from dealer to dealer.
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