Common Mistakes to Avoid When Buying a Car

Have you decided to buy a new car or do you feel sick after buying a new car? Why is buying a car so complicated? It shouldn’t be and we’ll tell you a few things to look out for to avoid all that stress. Well, is it going to be a brand spanking new car or is your frugal mind telling you to get a used car? Should you buy a gas or an electric vehicle? Will you be able to outfox the car salesman or will you come out of the dealers lot wondering if you got taken? So many uncertainties…so much of stress. Car buying should be a fun and exciting adventure and we’ve a few precautions you can take to avoid making mistakes.


Are you ready to have a great experience and not have anxiety after buying a car? So, here goes…


Don’t fall in love at first sight:

You’ve to go into a car-buying process with clinical precision and a heart of stone. You’ll need it especially when dealing with car salesmen. So, don’t fall head-over-heels in love with a car model. It’s easy to overlook some of the key features of a car and convince yourself that you can do without them. So go in with a list of things you need in a car, rather than a car brand and model. If you’re single, perhaps a two-seater coupe would be the way to go. If you’re married with no children, maybe a more spacious car and if you do have children, then think long term and go for a van maybe. A 4WD for the adventurer in you. A convertible for that wind-in-the-hair feeling.


And, remember that ‘stone cold heart’ that you came with to buy a car. That will come handy when you get into serious negotiations with the car salesman. Showing your weakness for a car make/model is like losing the battle even before it started. So, leave your emotions outside when you step into a car dealer’s showroom. Go get ‘em, Tiger!


Take the car for a spin:

If you’re a patient person with a lot of time on your hands, take all the test drives you can before buying a car. If you’re a busy person, then research all the cars that match your requirements and then shortlist a few of the cars and dealers before you take a test drive. Whatever else you decide to save time on, don’t you dare avoid a test drive. Take it for a spin…check out its external appearance, the interior space, gadgets, trunk space, leg space, headspace, etc. Feel comfortable? How does it drive? Is it low on the road or high up in the clouds? And, of course, take your family along for a ride. A couple of heads is better than just yours alone. Don’t let the salesperson push you into committing until you’re well and ready.


Negotiate till the cows come home…or not:

There are two types of car dealers. One, that has haggle-free pricing and clean operation, where you don’t have to worry about negotiating. Two, and the more stressful dealer, is the dealer where negotiation is everything.  That’s where you stick to your guns and be prepared to walk out to prove your resolve! The secret to good negotiation is spending time to research car prices before you enter a car showroom. You never pay sticker price unless you’re buying a Tesla Electric, where there’s no negotiation. Decide one thing when you go to buy a car…that you’re NOT going to pay a car’s sticker price!

The best way to negotiate is to email a bunch of dealers and ask them to quote you a price and all that it comes with. Question everything. There are multitudes of taxes and charges on the car that a dealer will add even after the negotiations are over. Don’t let them! Check for discounts online or get a deal from your local AAA. Then, renegotiate with a select few of the dealers and give them counter offers from your side. Once you make a final deal, go in, take a test drive, check/sign all the paperwork and get the car home!

A surefire way of avoiding all this stress…go to a haggle-free dealer, where the prices are competitive and they won’t take you for a ride.


Get smart…financing:

Again, there are luxury car dealers who are sincere and want to help you get good deals on financing and there are dealers that will commit highway robbery to sell you a car and get the financing for you. The former kind are genuinely trying to help. The latter is where the tricky part is. So, you do this…

The search for a good deal starts with finding a bank or financial institution that has the best interest rates on car loans. Do this before you visit dealers to buy cars, but don’t reveal to them that you’ve secured financing for the car. If not, the dealer will use their own affiliated bank or financial institution that may end up charging you a much higher interest rate or otherwise include unnecessary fees and charges to increase their own profits. Remember, the financiers have to pay the dealer some commissions for getting you to them.


Accessories! Accessories!! Accessories!!!

You might be a big fan of Vin Diesel in ‘Fast and Furious’ and may want your car to look like his in the movie. Be wary though…every little thing that you decide to add-on to the car increases the price of the car. Dealers may have other means to lure you into buying more. Rear spoilers, bodypaint / corrosion protection, window etching, fancy external stickers and decals, etc. It would be prudent to remember that you can always add some of that fancy stuff for much cheaper outside the dealer. So, stick to the essentials on the car you’re interested in. Once the deal is final, ask for add-ons like free oil changes, free car washes, discounted/free maintenance, etc. That way, they won’t secretly tag the price on to your monthly payment.


And…there you have it…

In conclusion, it helps to keep some of the things, mentioned above, in mind when you are ready to buy a car. Negotiating with a car salesperson is tough, but if you stand your ground and ensure that you don’t show them what you’re thinking about, you’ll come out winning every time. Essentially, you need a poker face to beat the odds.

Good luck!

Pros and Cons of Buying a Used Car

Buying a car is exciting and strenuous. There are a lot of parameters that need to be factored in before making a decision. It helps to make a list of everything you want in a car to make an informed decision on the make and model that best suits your purpose. 

While buying a brand-new car is very enticing, there are a lot of licensed pre-owned cars at much lower prices. You also get good warranties on certified used cars. Read on to find out more…

The pros of buying a used car:

Depreciation on new cars

Depreciation is the amount by which your new car loses value with time. Your new can depreciate as much as 10% in a month of buying it and by as much as 20% within the first year. So, essentially, if you were to decide to return the car to the dealer in 1 month, the dealer will buy it back for 90% of the value you paid for it last month.

You buy a car for $50,000 and decide to return it in 1 month. You’ll end up losing approximately $5,000. In a year, about $10,000. That’s not a comforting thought, is it? After the first year, the car depreciates at approximately 10% every year. so, in just 5 years, the value of this car will be roughly about $20,000, down to 40% of its original value.

On the other hand, if you decide to buy a used car, the depreciated would be much lower depending on the years the car has been running. If the used car is at least 5 years old, it will lose approximately about 10% of its value or $2,000 per year if you bought the car in the example above after 5 years. 

Reliability of the car

Cars have come a long way. Nowadays, cars are more dependable and reliable than ever before. Car companies conduct reliability tests and offer continued performance for about 200,000 miles provided, of course, they are properly maintained.  

Financing availability

There are a lot of financial institutions readily available in the market that offer great deals for financing a new car. Such institutions incentivize buyers with flexible payment options and cash rebates among other things. Interest rates are also much lower for new cars. Used cars also get financing but at slightly higher interest rates as compared to new car rates. But, it’s a trade-off as you’re financing a much lower amount as the car is used.

Certified pre owned cars

If possible, always go for certified pre-owned cars with proper licensing and certifications. These cars also come with extended warranties and a lot of added incentives. While the cost of such cars is relatively higher than the used cars bought without certification, they offer more reliability and peace of mind. 

The cons of buying a used car:

They don’t come with latest features

New cars come with newer technologies and latest modifications that make your driving them safer and more enjoyable. Pre-owned cars are older than the latest new cars and may not have that latest auto parking feature or heated seats etc. Of course, you could install some features that may be available in the off market.

Finding the right pre-owned car

Finding a new car is relatively easier but a used car may not be as easy to find to your specifications and likes. It could be as easy as going to a trusted used-car dealer and finding what you wanted, all in one showroom, but if you decide to go it alone, you may be faced with the harrowing task of going through multitudes of ads and visit to check out the car. Even after you choose a used car, you’ll still have to get a mechanic to check out its condition and ensure that everything is good. 

Maintenance

A used car’s regular maintenance cost will be more than that of a new car. Additionally, the new car warranty covers a lot of the cost but the same might not be true for a used car, unless it is bought from a certified dealer. It would be better if you weave in the maintenance cost into your monthly payment to be prepared for it. 

Conclusion

The pros and cons of buying a used car are listed in detail above. The final decision rests on you. Weigh your options carefully before you make your decision. Happy car buying!

Buying Car For Teen Driver

Teenage is the period of the adrenaline rush. It is also the period of busy lives due to continuous hopping between school or college, sports center, work and get together of friends and family. Having a car that can take your teen to places will ease out a lot of things and cut down the hassles involved in commuting from one place to another.

As a parent, there are a lot of considerations that you must be considered before letting your lad drive a car on busy routes. Safety, reliability, finances, license, etc. are some of the top considerations that would be popping up in your head in addition to the peace of mind. You’d want to make the most effective decision about the car you should buy whilst teach your teenager a wee bit about the responsibility involved in driving a car. So here is a checklist of all the things that you can keep in your mind while purchasing a car for your teen driver that will help in narrowing down your options:

1. Get an idea of the upfront expenditure

Buying a car involves a good amount of expenses to be made. A little advance financial planning for the same will ease you out with the mammoth of a burden that can follow otherwise. You can always pay the entire cost of the car by using your savings in one go. In such situations, if your child is below 18 years of age, you will be the legal owner of the car. Once your child attains the legal age of driving, you can always transfer the ‘Owner’ title onto him.

If you are seeking a loan to make the purchase and your kid is under 18 years of age, the loan will be sanctioned and approved in your name. All the payments will be taken care of by you. In fact, even at the age of 18, you will be signing the binding contract for car loan since in most cases the 18-year-old lads do not have a credit history that can help them in seeking a loan from banks and other financial institutions. One thing that you need to bear in your mind is that you will be in charge of all the payments involved and any failure in the same can hamper your credit score.

2. Finding a Car for the Teen

The first thing that you should consider during the process of buying a car for your kid is deciding whether you should buy a new car or a second hand one. Well, there is no right answer to this! It all boils down to a few factors like the amount that you are willing to shell out for the purchase of the car, the likelihood of your child taking care of the car he possesses, etc.

Before making a choice, one needs to weigh the factors involved in purchasing a new car or an old one. A new car is relatively expensive with higher insurance rates. However, the reliability of a new car is uncompromised and the maintenance costs are also low. On the other hand, a used car can save you quite a fortune. The maintenance costs are relatively higher and the prior performance of the car needs to be checked with. It is an important indicator of the reliability of the car.

Once your preferences align with the factors discussed above, you will be able to zero down on the right car for your teenager. If you decide to buy a second-hand car, make sure you purchase a certified pre-owned vehicle. It might be a bit more expensive but will also come with an extended warranty period.

3. List Down the Driving Rules for Your Teen

One of the major causes of accidents and eventual deaths on roads is the driver’s decision of not abiding with the driving rules. No matter how safe the roads are, if your child does not stick to the rules, he can also become prey to motor crashes. This is why laying the driving rules in front of your child is imperative before letting him get his hands on the car.

Tell your child to wear seat belts and ask him to ensure that every other person with him in the car wears a seat belt. Drinking while driving is a big No-No and make sure your child abides by that. Also, it is very important for children to know that using mobile phones, eating or applying makeup while driving is prohibited under law.

There are a lot of listed driving schools that can help the child in learning about the Dos and Donts of driving. If possible, you can also send your child for driving lessons. Additionally, consider sitting besides your child when he drives during the initial few months. This will help you in getting an idea of his driving style and you can also help him with a few driving tips on the go!

4. Buy a Right Sized Car and Get it Insured Before the Child Starts Driving

Children don’t really need giant SUVs right at the start of the driving experience. A medium-sized car or a hatchback is the perfect car to start with. These sedans are neither too small nor too big and also offer good safety features, so why not opt for them?

After having purchased the car of your choice, get in insured. If you already have an insurance policy in the name of your child, adding car insurance can lead to increased annual premiums. The premiums also increase as you buy him the car and add it to your insurance policy. However, the latter is a relatively cheaper way of getting the car insured.

5. Fix the Fuel Expenses Initially and Monitor the Car Performance

As it is the first time that your kid will get his hands on the car, you can always monitor the way and number of miles he drives by keeping a check at the monthly fuel expenses and car’s performance. This will help you to know how responsible your child is when he drives on the roads. There are a lot of mobile applications as well that can help you in tracking how the car treads on roads. Sometimes, technology does help in a big way!

Getting your teenager his first car can be the most exhilarating yet a daunting experience where you do not want to go wrong at any step. With the factors discusses above, you will be able to make the right choice of car for your child and later set out for a drive with him for an enjoyable experience.