Are you looking for a new car? Do you plan on paying in cash or through financing? Purchasing a car in cash is the right option than having it financed. Car financing is resorted by those wanting to acquire a new car but cannot afford to pay in cash. Car companies for wanting to make a sale likewise offer car loan aside from banks. Dealers earn a commission from the sale of the car when a buyer opted to secure a loan and complete payment over a period.
Dealers are less excited if buyers pay in cash for a brand new vehicle. On the other hand, spot cash on car relieves a buyer of high interest rate and the burden of coming up with a monthly amortization.
One buying a brand new car can always negotiate with the car dealer to lower the retail price by several hundred dollars. Aim to get the best deal. There are car buying tips and approaches to get your dream car at a great price.
Smart car buying tips:
1. Short listing the type of car you wish to own.
There are many choices, but the right car is decided only after you compare and look at all the features. Features include color, accessories, and other tangibles meant to improve the look of the car. For instance, there are dealers who offer different car wraps to go with your purchase of the vehicle. However, further research may show that getting a car wrap, like a gloss black vinyl wrap, elsewhere could be cheaper than if the price were added on top of the car’s purchase price. Keep your budget in mind. Consolidate your options to come up with a list of only a few car brands and models. Compare the retail price of the cars on your list. Thereafter, make your final reconsideration for the car that appeals to you and with the price that suits your budget.
2. Have a pre-approved car loan.
Look for car financing before buying a car. Find out which institution offers the best possible interest rate. Stay away from financing options the dealer is suggesting. They have high interest rates and extended period of repayment. With ready approved loan, you can spend for the car upfront, affording you to pay for the out-the-door price and not resort to Installment.
3. Test-drive the car.
Test-drive the shortlisted cars. Read reviews of the cars from the websites of manufacturers and forums among owners of cars that you consider buying. Read more about the engine specs and mileage. Look for any good or bad feedbacks owning the car after their purchase. You are almost reaching a decision.
4. Compare price quotes.
Before doing show room hopping, give time to call several car dealers and request for them to email you a quote of the prospective car. Make a list, with the best quote on top. Call the dealer with the best quote. Ask if they can lower their price to beat a competing dealer. Take heed dealing with quotes that is unbelievable.
5. Visit showrooms on weekdays.
Go on a weekday. There are few buyers and sales persons can attend to you. The agent tries to close a sale. This is your chance to negotiate for the price to get the best deal on a new car.
6. Clarify about out-of-door price.
Out-of-door-prices are additional dealer fees usually added by dealers just when you are about to close the deal. This is a strategy to make up for the profit loss. It is crucial to ask about the exact dealer fees. Included in the out-of-door cost are TT&L (tax, title, and license), and documentation fee. While add-on fees are negotiable, you are not obligated in any way to pay on any marketing charges.
7. Trade-in or trade-off.
During the process of closing the sale for the new car, the car dealer asks about your current car and if you are interested for a trade-in. This can lower the purchasing price of the new car. However, you are cautioned not to get distracted first by a good offer on your trade-in. Finalize the price of the new car first. Then, discuss the price for the trade-in car. Deduct this from the price of the new car. What’s left becomes the basis of the sales tax you are required to pay. You made a saving on sales tax.
Here’s one final tip. Time your purchase during the off-season – winter – when sales are low. Prices are discounted to generate sale. Knowledge of car buying tips makes you smart after all.