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Buying a new car without getting taken for a ride


Car dealership and cars

May 10, 2021

The process of buying a car doesn’t have to be a losing proposition. With a little help and a lot of preparation, you can slide into the car you want at a price you can afford. We’ve put together some ideas to help make your dream machine a reality.


Do your research

Some people careen into a dealership armed only with their need for a new set of wheels. Information is one of the most valuable tools you have when buying a car. So, before you get behind the wheel, get behind the keyboard, and see what you can uncover.  Online investigating can uncover anything you’d ever want to know about any car on the market before stepping foot into a dealership—the features you want, whether you want new or used, and the hidden costs associated with each.  

Here’s a step most people skip: To know what kind of deal you’re looking for, head to Edmunds.com (not yet, but after you’ve read this whole post) to find a vehicle’s True Market Value. TMV uses actual sales figures to determine the average price buyers are paying in your area. This is important, as you want to Run the Numbers, before you buy.


Run the Numbers

Determine how much you can honestly afford to spend. And more importantly, stick to it. The floor model may look nice; however, browse some car dealer sites and see which models and options are available that would meet you and your family’s needs. This will at least give you a ballpark estimate of what kind of cash you’re looking at.  

And don’t forget about insurance. Ask your insurance agent about premiums for your new ride so you can factor payments into your purchase decision. Sometimes they’re so steep you’ll want to find an alternative model.

Check out our auto loan calculator to help you do the math before you buy.

Did you know: You can ask for a dealership to email you a quote before you walk in? It’s true and it can help eliminate the stress of negotiating on the spot. With services like truecar.com you can obtain multiple quotes and even see what others paid for a similar model to your dream car.


Pre-Approve the Funds First

Now that you have determined your price range, the next step is funding. Sure, the dealership can help you find the funding, but remember, most dealer commissions come from the in-house financing and extras sold with the vehicle. Dealers don’t just hand out low financing to anyone. Read the fine print and you’ll notice these deals are reserved for those who have excellent credit. So be ready with a pre-approval from ECCU!

Get pre-approval on low auto loan rates before you head out to the dealer.  


Be ready to walk away

Vehicle shopping can be a high-pressure process, especially if you are alone. Having a friend with you can reduce the chances of your rushing into a decision, and it helps keep the salesperson accountable. If you just don’t have it in you to hold a steely-eyed stare down with a salesperson, ask someone to go with you who does.

Now, the pressure of on-site negotiation can seem tense, but remember, grandma said it best…be kind. If you come crashing into the dealership with an abrasive attitude, you’re not likely to get what you want from a salesperson. With a little courtesy and respect on your way to the negotiating table, you’ll be in the driver’s seat.

Nerwallet.com provides some great tips for negotiating. And the key tip is to walk away. Seriously. If you feel like you are not getting the deal you want or just don’t like the tone of the salesperson, walk away. Chances are the dealership will change their tune, as they don’t want to lose a sale to the dealership down the street.


Nothing wrong with used

There’s nothing quite like the feeling of owning a new car, but it comes at a price. Cars depreciate as much as 20-25% within the first two years. You may want to find one of last year’s models with low miles. This way the original owner absorbs most of the depreciation while you drive away in a near-new car that’s still covered under a partial warranty. It may be considered “used”, but it still is new for you.


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Category: Common Cents