Whether you’re buying a used or new, a car is probably one of the most significant investments you’ll ever make. It’s likely you aren’t spending tens of thousands of dollars on a single piece of furniture, clothing, or home décor (and if you are, then vehicle price isn’t a significant consideration for you, anyway).
You shouldn’t go cheap unless you have to. You don’t want your vehicle breaking down in the middle of the highway or leaking water on your head every time it rains. If you’re going to be spending more than a thousand bucks on anything, it should serve you well and reliably. Don’t buy cheap— make every dollar of your purchase count.
Here’s how to get the most bang for your buck when you’re buying a car.
Pay as Much as You Can Up Front
Most folks don’t have enough money to pay for their car in full—even when they’re buying a used car. Since a good car costs thousands of dollars, at the very least, you’d have to do quite a bit of financial planning to save up enough money to buy the car in cash. And that ’s what you precisely should aim.
At the very least, try and make a sizeable down payment on the car. If the car costs $30,000, try putting down between $5,000 and $10,000. It’ll reduce the amount of money you’ll have to borrow from a bank or credit union. Loans come with interest, so the less you borrow, ultimately the less interest you’ll have to pay. You can save quite a bit of money by just saving your extra cash and reducing your loan amount.
Buying a used car can save you thousands of dollars. You’re not necessarily sacrificing quality when you buy used. There are plenty of used cars that are in tip-top shape and have many more years of life if they gave the proper maintenance.
Ideally, you’d want to buy a used car that only has no more than 50,000 miles on it, but it depends on how much you plan on driving the car and what the exact build of the car is. You’ll want to avoid buying a used car that has been in a significant collision where the frame of the vehicle was damaged. Significant structural damage is severe to fix, and it could cause the car to suffer catastrophic failure after only a few months. You also don’t want to get a vehicle in which the interior seats and dashboard are damage.
Aside from thoroughly examining the car in person and taking it for a test drive, make sure that you get a copy of the car’s history. These reports will give you the history of the vehicle and will make a note of any collisions in it.
You can always buy a used car from a private seller. But there are also plenty of licensed used car dealerships that have a more reliable fleet of vehicles. You can find used car dealerships for nearly any brand of cars. You can find a licensed off-road dealer if you live in Nevada, a certified Audi dealer in Orlando, or a used convertible dealer in California. Just because you’re buying used, doesn’t mean you limited on your options!
Always Get Financing First
It’s still best to get financing before you buy your vehicle. Dealerships can offer you their funding for a new or used car. But be warned. Dealership loans usually have higher interest rates. You should go to your bank or credit union first to learn about their auto loan offerings. An auto loan from a financial institution will help you secure the best possible rate. It gives you the most bang for your buck!
Don’t be afraid to negotiate, especially if you’re buying a used car. Remember: dealerships are always competing against other dealerships for your business. Most of the time, they would instead take a few hundred dollars less than no money at all. They don’t want that to happen, so that’s why you’ll have to beat them at their own game.
A favorite strategy of car salesmen is the “you need to buy the car today because there are five other interested parties.” They’re not always lying, but don’t let them sucker you in. A vehicle is a big investment. And you should always sleep on it and intensively check your options before you decide to buy. Of course, you can always use the strategy on the car salesman: “I like the car, but there are some other vehicles I’m interested in at the other dealer.” . Sometimes—not always—it might just compel the salesman to give you an additional discount.
Pro tip: if you’re buying a used car. You can use any imperfections (like scratches and dents) as leverage for a lower price.
Buying a car without breaking the bank is entirely possible. Look for low-interest rate loans. You can make a significant down payment. Or a pre-approved loan is another way. You can consider buying used! So long as you check the vehicle’s condition and history. You should be in business for a new set of wheels at a great price.