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8 Car Buying Tips

by Ryan Guina

My wife and I are looking for a more family-friendly vehicle. We currently drive a 2 door Honda Accord and a 4 door Mazda 3. The Mazda 3 is currently our family car, but it is a compact car, about the size of a Honda Civic. It doesn’t give us much room for long trips or hauling passengers, luggage or other  cargo. So we are in the process of researching larger vehicles that will give us more flexibility for both passengers and cargo. I thought I’d share a bit about what we have learned so far, and the process we are using to narrow our search.

8 Car Buying Tips

1. Set a budget. Before you ever go car shopping you need to know how much car you can afford. Don’t let the dealerships trick you into thinking you can afford more car than you really can. Run the numbers in your budget and decide on a final vehicle price, not a monthly payment. A common dealership trick is to get you focused on the monthly payment, not the total vehicle price. It’s easy to make a vehicle appear affordable by stretching payments out over 5, 6, or even 7 years.

2. Decide which vehicle type fits your needs. The next major consideration is vehicle type. It will be helpful to examine your needs and how you will use your vehicle. Consider how many passengers you will carry, how much cargo you need to move, your commute (frequency, duration), how often you will use the vehicle for long trips, weather, special needs, and other factors. Narrow your list down based on the criteria that are most important to you and then drive a few styles of vehicles before trying to narrow it down by make and model.

3. Research vehicle make and model. Once you know the style vehicle you want, start researching makes and models and narrow it down to a few choices that meet your needs. There are dozens of places to research both expert and consumer vehicle reviews. Some of the best places I’ve found include Consumer Reports, Edmunds.com, Car & Driver, and Yahoo Autos.

4. Decide on a new or used vehicle. There are benefits to buying new cars, but they aren’t always the best deal financially. I am a big fan of buying used vehicles if you can find the right match of price and quality. But be prepared to put in a little more work if you plan on buying used. Used car prices are not quite as easy to compare as new car prices and you may have to drive to multiple dealerships to find the right match. You may also need to be more flexible regarding color and options. That said, the savings is usually worth the added effort.

Tip: Look beyond CarFax. CarFax is a great place to start, but you should do more research than just reading a CarFax report. Here are some additional tips for going beyond CarFax.

Car Research and Pricing at Edmunds.com5. Get multiple vehicle price quotes. There are several ways to get new and used car quotes. One of the quickest and easiest is to use a quote service like those found from Edmunds.com, Automotive.com, and Yahoo autos. Simply fill in your information, click submit, and you will be contacted by dealerships in your area. Another way is to contact the individual dealerships via phone or e-mail. The least effective way is to visit the dealerships in person, as it may take hours of negotiation and sales pitches to finally get a final price quote.

6. Trade in or sell on your own? Trading a vehicle in is usually the easiest way to get your old car off your hands, and your trade in can often be used as a down payment. There are also tax benefits of trading in your vehicle; it reduces the tax you pay on your new car. However, you can usually get a better price if you sell your car to a third party. It takes more work, but could net you hundreds, or even a couple thousand dollars. Make the decision before you visit the dealership.

7. Get your own financing in advance. You can save a lot of time and money by lining up your own financing before you ever step foot into a dealership. Having a pre-approved loan makes it easier to negotiate only on the vehicle price, without having multiple factors thrown into the negotiations. (It is always best to focus on one issue at a time when negotiating).

8. Get auto insurance quotes before buying. Before you buy your next car you should have a rough idea of how it will affect your car insurance rates. For example, many newer cars have safety features that may reduce your insurance rates, or a sports car may be more expensive to insure. Get free insurance rate quotes from companies such as Geico, or Esurance.

Do you have any car buying tips?


Published or updated January 23, 2012.
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{ 9 comments… read them below or add one }

1 Madison

Don’t forget to check out the car manufacturers that have corporate partnership programs or friends and family discounts. GM, Ford, and Chrysler all have them and they usually come out just as good, if not better than negotiating.

We bought both our Durango and Mazda 5 (which is a great alternative to a regular minivan!) using those programs.

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2 Mike

You lost me at “budget”. For both of my last two cars, I set a budget and then ended up spending a little over twice what I had planned. :)

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3 Charles

#8 is very important, i learned it the hard way. I was purchasing a mazda6 a few years back and i almost wasn’t able to drive my new car home that day due to insurance problems. Had i taken care of it prior to going to the dealership, i could’ve saved myself lots of headache.

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4 Daddy Paul

Great advice! One item to add is to know the dealers cost going in on new cars. Employee discount is often the price floor. If you can find an employee they can get a price for you. It may take a little negotiation but I find 50 bucks over that price is the price I can get to.

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5 Ryan

Good info. Do you have to know an employee? I don’t know anyone who works for a car dealership.

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6 Daddy Paul

Employees retirees are given user names and passwords to get the price on line. I retired from a big 3 company. My siblings, parents (if they were living), in laws, children and grand children can all get user names and passwords to get into the system.

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7 Mike

Good advice, many people still get outmaneuvered by a dealer and end up with too much car. Setting a budget, researching price and getting pre-approved are all keys to making your next purchase.

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8 laura lizabe

I came across this page doing some web work for GM and I thought it might be helpful let you all know that GM has a military discount available to active duty members and Reserves.

They have a Facebook page that aims to bring military families together to share their experiences. Check it out when you have some time http://bit.ly/ahsrkW.

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9 Ryan

If you don’t get an employee discount, the next best thing is a service like http://www.truecar.com who will find you the lowest price people are paying in their area. I got a good deal on my focus using them.

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