Buying a new car http://www.wisebread.com/taxonomy/term/531/all en-US The Safest Cars for Teen Drivers http://www.wisebread.com/the-safest-cars-for-teen-drivers <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-safest-cars-for-teen-drivers" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/first_car.jpg" alt="Teen driver in car" title="Teen driver in car" class="imagecache imagecache-250w" width="250" height="146" /></a> </div> </div> </div> <p>When I started driving six months before turning 16 years old &mdash; with a learner&rsquo;s permit &mdash; I was terrified of the roadways.</p> <p>Remember that scene in <em>Clueless</em> when Dionne accidentally exits onto the freeway and she, Cher, and Murray freak out? That was me. In fact, until I was about 19 years old, I had to turn off the radio when merging into moving traffic, and for the first year I avoided highways all together.</p> <p>It didn&rsquo;t help that I owned a beater of a car &mdash; and that&rsquo;s an understatement. This vehicle was so terrible that one of my best friend&rsquo;s fathers refused to let her in it. And in hindsight, I don&rsquo;t blame him. It looked like it might break down or blow up at any minute. Eventually it did &mdash; break down, that is. Luckily it was in my own neighborhood, so I did what any self-respecting teen boy would do in that situation &mdash; I called my dad to pick me up and left the car where it died for someone else to scavenge.</p> <p>So your kid doesn&rsquo;t suffer the same fate, conduct research into a vehicle&rsquo;s safety before you buy. I know that not everyone can afford a new car or even a great used car when their kid reaches driving age, but safety is never a poor investment.</p> <p>To help you make the most informed decision, I&rsquo;ve asked a few experts for their insight on how to choose the safest car for your new driver. Here&rsquo;s what they had to say. (See also: <a href="http://www.wisebread.com/how-to-get-cheap-auto-insurance-for-young-drivers">How to&nbsp;Get Cheap&nbsp;Auto Insurance for Young Drivers</a>)</p> <p><strong>Q: Overall, what's the safest type of car for teens?</strong></p> <p>A: &ldquo;Teens are safest in a mid-sized, four-door sedan with four cylinders. This type of vehicle does not have too much power, but still allows the inexperienced driver to maneuver safely through traffic,&rdquo; says LeeAnn Shattuck, co-owner of <a href="http://womensautomotivesolutions.com/home/womens_automotive-home.php">Women&rsquo;s Automotive Solutions</a>, a consulting firm that helps women (and men) buy cars. &ldquo;It's big enough to protect them sufficiently in an accident, but not so big that it is difficult to control. They also can't stuff too many of their friends into a mid-sized sedan, which can be a significant distraction for teens. My insurance agent partners all say that this type of vehicle is also the cheapest to insure for a teen.&rdquo;</p> <p><strong>Q: What about SUVs? They seem safe, especially since there&rsquo;s a higher center of gravity. Are they good for teen drivers?</strong></p> <p>A: &ldquo;Many parents think their teen is safest in an SUV because it will protect them in an accident,&rdquo; Shattuck says. &ldquo;But statistics from the Insurance Institute for Highway Safety (IIHS) show that teens are more likely to get <em>into </em>an accident in an SUV (vs. a sedan) because those larger vehicles (with a higher center of gravity) are much more difficult to control if they have to take evasive action. Because the SUVs also tend to cause more damage in an accident, insurance rates are higher.&rdquo;</p> <p><strong>Q: Besides safety in accidents, what are some other concerns parents should think about when buying a car for the teen?</strong></p> <p>A: &quot;I advise parents to avoid Hondas for their teens, especially for teen girls, since Honda Civics and Accords are the most stolen cars in America. You don't want your 16-year-old daughter getting car jacked on her way home from soccer practice or work,&rdquo; says Shattuck. &ldquo;I tend to steer parents more towards the Toyota Camry or even Corolla, the Nissans, and the Hyundais. Even the Ford Focus or Fusion (or an older Taurus) are safe and reasonably reliable. If they really want an SUV (to be higher up for better visibility), I highly recommend the Ford Escape. It's a decently reliable little SUV, easy to drive, used ones are in the $6,000 to $10,000 range, and they have relatively low maintenance costs.</p> <p><strong>Q: What are the benefits of a used car over a new car?</strong></p> <p>A: &ldquo;Buying used for a young driver makes more sense than buying new since overall vehicle costs on used cars are typically lower,&rdquo; says Max Katsarelas, marketing strategist for <a href="http://www.mojomotors.com/">Mojo Motors</a>. &ldquo;Plus, with the rapid depreciation of a new car once it drives off the lot, buying used can save some major coin, especially when considering the accident rate of young drivers. Auto repair costs for young drivers total about $19 billion, so buying a new car doesn't make financial sense when taking into consideration the resale value after an accident. Since a vehicle's crash history can be seen with a Carfax report and any sign of an accident, even &lsquo;fender benders&rsquo; drop a vehicle's resale value considerably. Ultimately, the best bet for parents looking at cars for young drivers should <a href="http://www.wisebread.com/6-reasons-why-used-is-better">buy used</a>. For example, a new 2012 Ford Focus starts at around $18,000. A gently used 2008 Ford Focus with under 60,000 miles can be had for under $10,000. Both boast the highest safety rating, &lsquo;Good&rsquo; from IIHS, but a used Focus can cost up to $10,000 less.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/the-safest-cars-for-teen-drivers">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-reasons-why-you-should-never-buy-a-new-car">3 Reasons Why You Should Never Buy a New Car</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-your-new-tires-really-6-year-old-ticking-time-bombs">Are your new tires really 6-year old ticking time-bombs?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-do-with-a-junk-car">What to Do With a Junk Car</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-get-your-car-stolen">How to get your car stolen</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-buy-a-used-car-without-getting-ripped-off">How to Buy a Used Car Without Getting Ripped Off</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Consumer Affairs Buying a new car driving safety teens used cars Thu, 22 Dec 2011 11:24:13 +0000 Mikey Rox 835751 at http://www.wisebread.com The Top 10 Cheapest Cars to Insure http://www.wisebread.com/the-top-10-cheapest-cars-to-insure <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-top-10-cheapest-cars-to-insure" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2011_car_insurance.jpg" alt="Toyota Sienna" title="Toyota Sienna" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>If you&rsquo;re thinking about buying a new vehicle, make sure you&rsquo;ve done your homework about average <a href="http://www.wisebread.com/auto-insurance">auto insurance</a> rates. According to <a href="http://www.insure.com/car-insurance/car-insurance-comparison.html">Insure.com</a>, the most expensive car to insure in 2011 was the Mercedes SL65 AMG, a sporty, two-door convertible that has the highest chance of getting in a car crash. Insurance companies are more likely to lower your insurance rates when they trust your chances of getting into a crash &mdash; or having your car stolen &mdash; are very low. This is why SUVs, minivans, and other non-sporty vehicles continue to rank at the top of the &ldquo;cheapest cars to insure&rdquo; list year after year. (See also: <a href="http://www.wisebread.com/the-joy-of-buying-a-new-car-9-car-buying-tips">The Joy of Buying a New Car: 9 Car Buying Tips</a>)</p> <p>Insure.com gathers data on national average annual premiums for different makes and models and ranks them based on premium price. For 2011, the top ten cheapest cars to insure were:</p> <h2>1. Chrysler Town and Country</h2> <p>The average annual premium for this vehicle was just $1,091.80 in 2011. The popular family minivan has been around since the late 80s, and the latest models have advanced safety features and high safety ratings.</p> <h2>2. Toyota Sienna</h2> <p>With an average annual premium of $1,100.66, this is another family minivan with high safety ratings, and the third generation Sienna was the first to receive a &ldquo;Top Safety Pick&rdquo; award from the Insurance Institute for Highway Safety.</p> <h2>3. Toyota Sienna LE</h2> <p>This is one of the trim levels available on the Sienna minivans, and it boasts a V6 engine with all-wheel drive. More control and power means increased safety on the road. The average annual premium was just $1,108 for this version of the Sienna.</p> <h2>4. Honda Odyssey LX</h2> <p>The fourth-generation minivan available in 2011 boasts a larger body and lower roofline. It also has ventilated front disc brakes and six-speed automatic transmission for a smoother ride. The average annual premium for this vehicle was $1,115 in 2011.</p> <h2>5. Nissan Murano SL</h2> <p>Probably the sportiest crossover vehicle you&rsquo;ll find that commands low insurance rates, this stylish ride offers plenty of comfort and a full range of advanced safety features. The average annual premium was $1,127.89 in 2011.</p> <h2>6. Jeep Wrangler Unlimited Sport</h2> <p>This SUV boasts 40% more horsepower and 10% more torque than other Jeeps on the road, but still has the classic Jeep styling. It&rsquo;s one of the best 4x4s on the market, and the average insurance rates are just $1,131.27.</p> <h2>7. Honda Odyssey EX</h2> <p>Another minivan to consider for those family outings and road trips, this reliable vehicle tops the &ldquo;safe&rdquo; list for many insurance companies. The average annual premium was $1,138.16 in 2011.</p> <h2>8. Toyota Sienna V6</h2> <p>The V6 engine versions of the Toyota Sienna are also a top choice for insurers, since these models promise more power and control among other minivans of a similar size. The average annual insurance premium was $1,143 in 2011.</p> <h2>9. Ford Escape XLS</h2> <p>This SUV is a popular alternative to the standard minivan and is also among the most affordable to insure. The average annual premium in 2011 was just $1,150.</p> <h2>10. Toyota Highlander</h2> <p>If you&rsquo;re only interested in foreign vehicles, consider purchasing the Toyota Highlander. While it may be a gas guzzler, it&rsquo;s also among the more attractive alternatives to a minivan, and it&rsquo;s loaded with deluxe amenities and safety features. The average annual insurance premium was $1,154 in 2011.</p> <h2>Getting the Lowest Insurance Rates</h2> <p>When you&rsquo;re looking for the lowest insurance rates, stick with the practical, less-flashy vehicles, and you&rsquo;ll probably be looking at a lower-than-average insurance premium. Don&rsquo;t forget you can also reduce insurance costs by purchasing a vehicle that has extra safety equipment and <a href="http://www.wisebread.com/disguise-your-stuff-to-prevent-car-break-ins">anti-theft devices</a> installed. If you&rsquo;re getting your car insurance coverage with the same insurance company that you have homeowners insurance with, you might also qualify for a discount.</p> <p>Keep in mind that all insurance companies will take the type of vehicle you drive, your driving history, your credit score, and other factors into account when calculating your premium. The above averages from Insure.com are estimates for the average driver and the actual insurance premium you end up paying could be higher or lower based on where you live, how often you drive, and several other factors.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sabah-karimi">Sabah Karimi</a> of <a href="http://www.wisebread.com/the-top-10-cheapest-cars-to-insure">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/repair-the-car-or-spend-the-cash">Repair the Car or Spend the Cash?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-mechanical-breakdown-insurance-worth-it">Is Mechanical Breakdown Insurance Worth It?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-tips-to-save-on-car-insurance">4 Tips to Save on Car Insurance</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/when-to-drop-collision-coverage-on-your-car">When to drop collision coverage on your car</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-myths-about-car-insurance">5 Myths About Car Insurance</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Insurance Buying a new car car insurance Thu, 15 Dec 2011 10:48:16 +0000 Sabah Karimi 824535 at http://www.wisebread.com Drive the Old Car or Buy a New Car? http://www.wisebread.com/drive-the-old-car-or-buy-a-new-car <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/drive-the-old-car-or-buy-a-new-car" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/car-126488331.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>When I was growing up, my mom drove a gray Oldsmobile Omega. By the time I was old enough to notice such things, it was an old car &mdash; much older, and clearly less luxurious, than those most of my friends rode to school in. When the plastic knob broke off the end of the shifter, it was replaced with a huge wooden one. When we hit a bump in the road, the radio hissed with loud static. Near the bitter end, duct tape held up the driver-side window.</p> <p>When my mom finally got a new car during my second year of university, I was relieved. But when &ldquo;Old Gray&rdquo; recently came to mind, I found myself feeling less embarrassed than grateful. Here&rsquo;s why. (See also: <a href="http://www.wisebread.com/7-ways-my-clunker-is-smarter-than-a-hybrid">7 Ways My&nbsp;Clunker Is Smarter&nbsp;Than a Hybrid</a>)</p> <h3>Do You Want a Nice Car, or a Nice Pile of Cash?</h3> <p>My parents were fiercely (and at the time, inexplicably) loyal to their reliable old car. In fact, when I admired newer cars on the road, my mom would sniff, and say, &ldquo;Yeah, but this one is&nbsp;<em>paid</em> for.&rdquo;</p> <p>At the time, I had no idea what that meant. I knew that both my parents had good jobs, so why couldn&rsquo;t we have a <a href="http://www.wisebread.com/the-joy-of-buying-a-new-car-9-car-buying-tips">new car</a> like everyone else? The answer &mdash; the cost was just too steep, and in more ways than one. According to the Federal Trade Commission, the average cost of buying a new car is approaching $30,000. At an average interest rate of 6.5%, that $30,000 car would mean monthly loan payments of $586.98 per month for five years. Put that money into an investment that returns 5%, and you&rsquo;ll end up with more than $40,000 in the bank in that same five-year period. Shelling out a lot of money to keep yourself in a nice ride is fine, if you can afford it. But with a national savings rate of just 4.5% of <i>disposable income</i> (not total income!), and many people arriving at retirement without a penny in the bank, chances are that a nice ride is further out of reach than most people realize.</p> <p>Just about everyone is guilty of a little &ldquo;keeping up with the Joneses,&rdquo; but there&rsquo;s a big difference between being able to afford something and being able to afford the payments. Next time you catch yourself envying what someone else is driving, think about what you might really be aspiring to. While I may have been rattling around in a beater as a kid, what this meant was not that my parents were poor, but that they were saving their money. And, as it turns out, that&rsquo;s not as lame as I had assumed.</p> <h3>Living in the Fast Lane Can Lead to&nbsp;Financial Crash and Burn</h3> <p>As my mom prepares to retire, I&rsquo;ve found yet another reason to be grateful for Old Gray &mdash; because we didn&rsquo;t ride around in a car my parents could barely afford, I don&rsquo;t have to spend my adult life trying to figure out who&rsquo;s going to finance my mother&rsquo;s retirement. This is no small thing. A recent report released by Massachusetts Mutual Life Insurance Company stated that only 3 out of 10 American parents believed they were adequately preparing for retirement. Plus, those parents were planning to have to care for their own parents as well.&nbsp;</p> <p>My parents stuck it out with Old Gray for more than 20 years, which was pretty unusual then &mdash; and very rare by today&rsquo;s standards. But, because of this and other similar choices, their retirement will not be something that will fall to me, which means that I have a shot at <a href="http://www.wisebread.com/how-to-tell-if-youre-on-track-for-retirement">retiring comfortably</a> too.</p> <h3>The (Somewhat Sensible) Way I Roll</h3> <p>Now you&rsquo;d probably expect that I&rsquo;d end this by telling you that I drive an old, reliable car. I don&rsquo;t. I bought it used, and I went for reliable &mdash; but I paid the price for a turbo engine and heated leather seats. What that says about <em>my</em> desire to keep up with the Joneses may be another story altogether, but what I do know is that while I&rsquo;ve taken some pains to drive a nicer car than my parents would ever buy, there is a limit to how much I would sacrifice for that experience &mdash; saving and investing will always come first. And if that means I&rsquo;m still driving the same car 20 years from now, so be it.</p> <p>Oh, and one more thing &mdash; Old Gray is still on the road. Perhaps my parents could have held on to it a little bit longer.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tara-struyk">Tara Struyk</a> of <a href="http://www.wisebread.com/drive-the-old-car-or-buy-a-new-car">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-having-a-paid-off-car-is-surprisingly-great">5 Ways Having a Paid Off Car Is Surprisingly Great</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-this-the-best-search-engine-ever-for-new-used-cars">Is This the Best Search Engine Ever for New &amp; Used Cars?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/can-t-afford-your-car-much-longer-negotiate-to-keep-it">Can’t Afford Your Car Much Longer? Negotiate to Keep It</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-top-10-cheapest-cars-to-insure">The Top 10 Cheapest Cars to Insure</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Retirement Buying a new car car loans used car Wed, 09 Nov 2011 10:24:33 +0000 Tara Struyk 778732 at http://www.wisebread.com Car Buying Part 2 – Into the Devil's domain. http://www.wisebread.com/car-buying-part-2-into-the-devils-domain <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/car-buying-part-2-into-the-devils-domain" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000035853430_XXXLarge.jpg" alt="untrustworthy car salesman" title="untrustworthy car salesman" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Last time I covered the basics of <a href="http://www.wisebread.com/car-buying-part-1-going-for-broker">going with a broker</a>. I hope many of you found that advice useful. Now, I&rsquo;m going to cover a few basics of buying a new or used car from a car dealership. (I&rsquo;m not into leasing because, well, I&rsquo;ve never leased. It&rsquo;s just never been the right option for me, so I couldn&rsquo;t offer you great advice on something I&rsquo;ve never done myself.)</p> <p class="MsoNormal">Now I must point out that I really only am covering basics here. I could write a book about buying a car from a dealership, and many qualified professionals have already done so. That&rsquo;s why I&rsquo;d choose a broker over a dealership haggle. But, I didn&rsquo;t have the broker option last time for one simple reason: My car died on me and I needed a new one ASAP. That&rsquo;s when a broker falls down on doing it yourself. You can&rsquo;t play the waiting game if you have no car to drive. So, once more into the Devil's domain I ventured. And here&rsquo;s what advice I have to offer on that subject, in 10 simple steps.</p> <h2>1. Research, Research, Research</h2> <p class="MsoNormal">I was lucky. When my old car kicked the bucket, I had already done my research. I knew I wanted a 2007 Civic Coupe, I knew the specs I wanted, and knew the price I was going to pay. I was armed. I recommend you do the same. Do yourself a favor and go into a dealership with the car you have in mind bolted deeply in your head.</p> <p class="MsoNormal">There are many ways to research a car. Use <a href="/www.kbb.com">Kelley Blue Book</a>&nbsp;and <a href="/www.edmunds.com">Edmunds.com</a>. They are worth their weight in gold. Is an LX better than a DX, or is the extra cost not worth it? Do you need good fuel economy, or rear, front, or all wheel drive? What exactly do you need? Spend weeks on this, really. There is no such thing as a good impulse buy when it comes to a car.</p> <h2>2. What Can You Afford?</h2> <p class="MsoNormal">When you find the car you want, find out its TMV, also known as <em>true market value</em>. You can find more about that at Edmunds.com</p> <p class="MsoNormal">This is basically what people are paying for that car across the country, taking into account dealer incentives, seasonality, and so on. This is a great place to start. On no account do you want to pay MORE than the TMV. Ideally, you&rsquo;re going to use this as a figure to drive the price down. I managed to get my car for well under the TMV, and that price was way, way under the sticker price on the car. What is sticker price? Well, that&rsquo;s the pie-in-the-sky amount you see on the window that the dealer is hoping you&rsquo;ll pay. And you will, if you&rsquo;re known as a &ldquo;laydown.&rdquo; A good car salesman knows a laydown after just a few minutes (or sometimes less). A laydown will basically say all the wrong things, come armed with no research, reveal how much they want to pay immediately, reveal their trade-in, and so on. DON&rsquo;T be a laydown. So, bearing all that in mind, you now know what you want, and what you are willing to pay. Next, the trade-in.</p> <h2>3. Trading In Your Old Car</h2> <p class="MsoNormal">So, most of you will have a trade-in. If you can, make sure this is paid off. You see those ads saying &ldquo;I&rsquo;ll pay off your trade no matter what you owe?&rdquo; Of course he will. You can owe $28,000 on a car worth $35,000. He doesn&rsquo;t care. All the dealer wants is your name on the dotted line. So, he&rsquo;ll take in your car, pay off your trade, and apply that huge figure to the balance of your new car. Guess what. Now that nice little car you had your eye on just doubled in price. Ouch.</p> <p class="MsoNormal">Even if you only owe a few thousand, get it paid off. It puts you in a much better place at the negotiating table. Now, you also need to get the fair value of this car. Kelley Blue Book is a great resource. They have a tool for estimating the fair trade-in value of your car. And by fair, that means be honest. When you fill out the form, don&rsquo;t say your car is in &quot;excellent&quot; condition if it has a few dings and needs a new transmission. The dealer&rsquo;s no fool. Get the real trade-in value, and write that down. Take NO LESS than that. And above all, never mention your trade-in until you&rsquo;ve done the deal on the new car. Mentioning this first puts you in a position of weakness.</p> <h2>4. Financing Ahead of Time</h2> <p class="MsoNormal">If you can, get yourself pre-approved for a blank check auto loan. This gives you so much power at the closing table, I can&rsquo;t tell you how cool this is. You&rsquo;re not at the mercy of dealer offers, and best of all, you know exactly how much you&rsquo;re approved for. Most financial institutions will do it, I used a credit union. They have excellent rates and you already know them if you use a bank you&rsquo;re familiar with. Also, know what your credit score is. That lets you know what kind of APR you&rsquo;re going to get if you do decide to go with a financing offer from the dealer. I&rsquo;ve never paid more than 6.5% APR. Last time, it was 5.75%.</p> <p class="MsoNormal">So, you&rsquo;ve done the research, got the cash, know what you want, and what you&rsquo;re willing to pay. You even know the price of your trade, down to the last cent. You&rsquo;re ready. (I&rsquo;d say at this point, wait until the ideal time to buy a car &mdash; ideally, just before delivery of the new year's cars. But, as most of us can&rsquo;t wait for one specific month in the year, let&rsquo;s move on.)</p> <h2>5.&nbsp;The Dealership, the Sales Staff, the Horror</h2> <p class="MsoNormal">I hate dealerships. I really do. It&rsquo;s all a complete façade. You want to walk away with a car for peanuts, the dealer wants you to go bankrupt on a compact car with a rubberband engine. But, this is where you can knuckle down and get the deal.</p> <p class="MsoNormal">First, walk into the dealership armed with your folder, filled with research and cold, hard facts and figures. That tells them straight-away that you are no laydown. Bingo. Stage one complete. Now, choose your vehicle. You know it. You&rsquo;ve seen it before. Hopefully, you&rsquo;ve even test-driven it a couple of times on previous occasions and walked away (good for you&hellip;this has the dealership dangling on a hook for your business). Now, you&rsquo;re ready to say those immortal words &ldquo;I think I&rsquo;d like to buy this car.&rdquo; At this point, you&rsquo;ll get escorted to the &quot;table&quot; and this is where battle commences. You&rsquo;re going to hear things like &quot;What can you afford as a monthly payment?&rdquo; or &ldquo;Well, your trade-in isn&rsquo;t quite up to scratch.&rdquo; Here, I present you with the golden rule&hellip;</p> <h2>6. If In Doubt, Walk Out</h2> <p class="MsoNormal">Seriously, this is a dealership&rsquo;s Achilles heel. The second you mention that you&rsquo;d like to think about it, and stand up, they freak. You&rsquo;re almost a sale. You&rsquo;re almost a big, fat, juicy commission check. There&rsquo;s no way you&rsquo;re leaving. And this is when the tables turn back to your favor.</p> <p class="MsoNormal">Be firm. Before they throw a whole bunch of mumbo jumbo handling fees and so forth at you, ask to see the INVOICE price of the new car. That&rsquo;s the price they paid for the car, and by law they have to show it to you. Check as well. Make sure they&rsquo;re not showing you an invoice for a souped-up version of the car you&rsquo;re buying. If you&rsquo;re buying a used car, you should already have the figure from your research at Kelley Blue Book. Either way, once you have that figure you know you&rsquo;re not going to pay much more. Remember, don&rsquo;t talk about a trade-in. Wait until you&rsquo;ve agreed on a price, not based on a monthly payment but on a final, everything included, sale price. When that&rsquo;s good and you feel good, then mention your trade. And you don&rsquo;t say yes until you get what you want. You&rsquo;re being reasonable, because the price you want is a good $2,000<span style="font-family: Arial; font-size: 14.6667px; font-style: normal; white-space: pre-wrap; color: rgb(0, 0, 0); line-height: 1.5; background-color: transparent;">&ndash;</span><span style="font-size: 13px; line-height: 1.7em;">$3,000 less than what the dealer will sell it for. That&rsquo;s a nice profit. Add that to the small profit they&rsquo;ll make from the car they sell you, and they&rsquo;ve done quite nice for a few hours work.</span></p> <h2>7. The Salesperson Is Not Your Friend</h2> <p class="MsoNormal"><span> </span>A few times, I&rsquo;ve had scenarios where a salesman has gone back and forth between myself and his boss, struggling on my behalf to get my payment down by a few thousand dollars. It&rsquo;s bunk. Total bunk. He&rsquo;s probably going in there to talk about the weather, or last night&rsquo;s ball game, or what a sucker he has for a client right now. If you get the sense that you&rsquo;re being taken for a fool, refer to the step aboe. There is more wooden acting going on here than in a bad soap opera.</p> <h2>8: Deal&rsquo;s Done: Off to Financing Hell</h2> <p class="MsoNormal">Yikes. Another table. Another set of papers. And yet more ways to get screwed. Only this time, you&rsquo;re dealing with a person who is a phenomenal bean-counter. It&rsquo;s the job of this person to add everything possible on to the sale of the car. Extra warranties, GAP insurance, clear bras, tinting, rust-proofing, alien-avoidance-radar, you name it, they&rsquo;ve got something to sell.</p> <p class="MsoNormal">In my opinion, take nothing. All of these you can find yourself from great institutions at much less than what the dealer will charge. They mark these up by an enormous amount. You know what you want to pay, and with the unavoidable addition of dealer handling fees and sales tax, that&rsquo;s all you will pay. If you have a blank check, sign it and hand it over. If not, you know your credit score so you know what kind of APR is coming to you. Feel good? Sign the papers. Don&rsquo;t feel so good? See above and walk away. You can come back another day, after you&rsquo;ve had time to think it over. Until you sign, you are liable for nothing.</p> <h2>9. Check Your Vehicle</h2> <p class="MsoNormal">Whether new or used, give your car a thorough going over before you leave the dealership. It&rsquo;s amazing what shows up in daylight, after the car has been detailed. If you&rsquo;re not happy with anything, make it known. The dealership will have to take care of it. Remember, this is a big purchase. Most likely the second largest after your home. So, just like a walkthrough before you move in, give your car that final once-over. Now, you&rsquo;re ready to drive off home. It&rsquo;s been a few hours, you&rsquo;re a little older and a little greyer on top, but you did great. Now you can see why choosing a broker is preferable.</p> <h2>10. Relax</h2> <p class="MsoNormal">Go home, put your feet up, grab a cocktail or a nice fat cup of tea and pat yourself on the back. You have walked into the Devil&rsquo;s domain and came out smelling of roses. Most people don&rsquo;t. I know it took a long time to cover this, but it was worth it. And as I always say, IF IN DOUBT, WALK OUT.<strong> </strong>That&rsquo;s your biggest bargaining chip. Happy motoring, folks.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/car-buying-part-2-into-the-devils-domain">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/save-on-your-new-car-send-mom-not-dad-to-the-dealer">Save on Your New Car: Send Mom, Not Dad, to the Dealer</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/easy-ways-to-save-on-7-everyday-buys">Easy Ways to Save on 7 Everyday Buys</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-hire-a-broker-to-buy-a-car">Should You Hire a Broker to Buy a Car?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-new-toys-to-teach-kids-about-money">How to Use New Toys to Teach Kids About Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Shopping Buying a new car car dealerships car deals saving money Sun, 21 Jan 2007 17:03:24 +0000 Paul Michael 206 at http://www.wisebread.com