Tuesday, October 2, 2007

7 Insider car-buying tips

1. Financing
It's always good to be pre-approved by your bank or credit union, it helps you negotiate a better rate when you get to the dealership. If you qualify, the dealer can sometimes offer a better rate than your bank or credit union.

2. Leasing
Leasing can also be an attractive option by getting more vehicle (equipment) for a smaller payment than financing and less out of pocket cash. But beware of the restrictions with leasing, i.e. mileage constraints, wear & tear costs, higher insurance rates and many have a disposition fee at the termination of the lease from $250 to $400.

3. Look to buy your car on the last three days of the month
Dealers need to make their quotas for the month, which has them pay less on floor plan dollars and allocates more vehicles to the dealer (the more vehicles sold, the more the dealer gets in return from the manufacturer). Dealers must sell their oldest inventory to avoid paying interest on the new cars they have in their inventory. Ask how long the car you’re buying has been in their inventory, you may even get a better deal if it has been in their inventory over 90 days.

4. Know what you want
Narrow your choices to a particular make and model. Don't buy options you don’t need, such as a 4X4 when you drive mostly in the city and your vehicle is never used in off road or in extremely bad road conditions.

5. Negotiate
Always negotiate. Before you arrive at the dealership, know the incentive programs available for the vehicle you’re interested in (if any are available) — even with less than desirable credit you should still negotiate the price.

6. Read the fine print on your warranty
It may NOT cover you bumper to bumper. They are usually a limited bumper to bumper and in some cases non- transferable.

If you follow these car buying tips the sales manager will always take your deal and you’ll leave with a new vehicle.