What Questions To Ask When Buying A New Car
Wait. Before you agree to buy that new car, take a few minutes to ensure there are no hidden problems that will surface when you're in the middle of signing the contract. This also is your last chance to use your leverage to sweeten the deal a little more.
what questions to ask when buying a new car
These questions are "deal testers," a way for you to verify the terms, become familiar with all the fees and make the delivery process more convenient. The list includes two questions specifically for people who did most of their shopping via the internet and are making a deal over the phone. (We highly recommend the internet car shopping route since it is faster, less stressful and will often get you a better price.)
2. How much is your documentation fee? All car dealers charge a documentation ("doc") fee when you buy a car. This means they actually charge you for filling out the contract. It seems strange, but it's universal. What isn't universal is the amount dealers charge for the doc fee. Some states cap the doc fee, usually at a price below $100. Other states don't regulate the doc fee, so it can be as much as $600. While expensive in some states, these fees have become standard fare in the car business. If you're in a state without a capped fee and feel the price is too high, your time will be better spent negotiating the price of the car rather than getting the dealer to waive the doc fee.
3. Are there any dealer-installed options on the car? Most cars come with options installed at the factory when the car is built. But sometimes the dealer adds items as a way to boost profit. Popular add-ons include nitrogen-filled tires, window tinting, wheel locks, all-weather floor mats, paint protection and more. These are called dealer "add-ons" and the markup can be quite steep. A common add-on is LoJack, a vehicle recovery system. Dealers often add the system's cost to all the new cars in its inventory. Seeing it on every vehicle makes it seem as though it comes standard, but it's an item the dealer has added. We're not saying you should never buy a car with dealer add-ons. But you want to know about any add-ons well in advance, ideally when you're soliciting a price quote. Know that there's a markup on them and negotiate accordingly.
4. How many miles are on the car? This is particularly important for internet shoppers who might not have seen the car yet. You would think that every new car has less than 10 miles on the odometer. But in some cases, the car might have gone on a lot of test drives or is a "dealer trade," meaning the dealer traded another car for it and it's been driven in from another dealership. If there are more than about 300 miles on the car, you need to negotiate a lower price. If the car has been on the lot for a while or has a few hundred miles on it, you may want to ask for the "in-service date" of the vehicle. It's usually on the date you buy the car, but not always. The in-service date is when the warranty begins, and it is important to know how much coverage you have.
The CarLotz auto consignment model reduces overhead and inventory costs, so buyers pay below traditional dealer prices. Noncommissioned sales and our simple finance process makes buying easy. Swing by anytime for a test drive, or shop 100% online.
Your insurance rates typically change when you acquire a new vehicle. Before you choose a model, the nonprofit Insurance Information Institute recommends that you ask your insurance rep how much it will cost to insure.1
Design characteristics are important when choosing a new car. Larger and heavier vehicles typically sustain less damage in auto crashes than small cars. Some small utility vehicles and pickups are prone to rollover accidents.
If you take time to research prices online before you visit a dealership, you'll have a better idea of what a competitively priced car should cost. Often, the best time to buy is during end-of-the-year sales, when dealers need to make room for newer models, notes the Las Vegas Review-Journal.3
Sources:1 -can-i-save-money-auto-insurance2 -buying/10-steps-to-buying-a-new-car.html3 -secrets-getting-the-best-deal-new-car4 -shopping/buying-a-car-why-you-shouldnt-focus-on-the-monthly-payment-242019
A vehicle sitting in the classifieds or on a dealership lot may have many stories to tell, as long as you know what questions to ask when buying a used car. Shopping for a used car can seem like a challenge, and you're not alone if you feel this way. Arming yourself with strong questions could help you know what you're getting into.
When shopping around, don't be afraid to grill a salesperson. Off the bat they may lack answers, but that's nothing a little digging on their part can't solve. What about questions to ask when buying a used car from a private party? The good news is that private-party sellers may know more about their cars than dealers do. After all, they've probably been driving the vehicle for a while, and in some cases, they may even have owned it since new.
A "yes" to either of these does not have to automatically lead to a "no" from you, but it should open some follow-up questions, such as the severity of damages incurred and extensiveness of repairs. Documentation for these items is critical as it can be hard to take a seller at their word.
I find that to be sort of vague, so I recommend focusing on the monthly cost. Financial advisors disapprove of this because you can wind up "buying more car than you can afford" if you stretch out the loan, and you also end up paying more in interest.
Infotainment tech is different from safety tech. A big benefit of buying a new car is getting modern driver-assist features, such as emergency braking and lane-departure warnings, to go along with crash-mitigation technologies, including crumple zones and airbags.
A new car often means an increase to one's insurance costs. For example, I dropped theft and collision coverage on one of my older cars, greatly lowering my bill. But I had to add it back when I replaced that vehicle.
The new car market continues to thrive, and prices remain at an all-time high. So, even if you feel like a seasoned veteran when it comes to negotiation and car buying there are still a few key points to cover to ensure you get the best deal. Make sure the dealer can answer these questions before signing off on a new vehicle.
In some cases, you will qualify for a rebate or incentive when you purchase a new vehicle. This perk generally reduces your purchase price after taxes.These range from deals during certain times of the year to those available for certain groups, like veterans or students.
As well as asking all these questions, you should also do your homework before buying a used or new car. A little research and preparation can improve your chances of getting a great deal and driving home happy.
Check your credit score and credit report to gauge the health of your credit history, and if there are some improvements you can make, take the time to address those before you proceed with the car-buying process. This can take time, but the lower interest rate and monthly payment can be worth it.
Before buying a car, no matter whether new, used or even as a gift you need to budget properly and make sure that you can insure it each month and afford the fuel you will need to get around. If you are a first time buyer or a young driver then you particularly need to investigate the full cost of car ownership as there is nothing worse than having your beautiful car sitting on the driveway depreciating as the running costs are too high.
Use some questions to ask customers in the middle of the sales process. You may think a sale is going well, but they may still have questions in the back of their mind they feel nervous to ask. You could ask them:
You may also want to consider using a car buying service. These services have higher buying power than individuals and can connect you with their dealer networks to get the best possible deal. They can also shop around their network to get you the best trade-in for your existing car. Of course, as with any broker or third-party service, do your research and make sure you choose a reputable one.
But many Americans make big mistakes buying cars. Take new car purchases with a trade-in. A third of buyers roll over an average of $5,000 in debt from their last car into their new loan. They're paying for a car they don't drive anymore. Ouch! That is not a winning personal finance strategy.
"The single best advice I can give to people is to get preapproved for a car loan from your bank, a credit union or an online lender," says Philip Reed. He's the autos editor at the personal finance site NerdWallet. He also worked undercover at an auto dealership to learn the secrets of the business when he worked for the car-buying site Edmunds.com. So Reed is going to pull back the curtain on the car-buying game.
So Reed says having that preapproval can be a valuable card to have in your hand in the car-buying game. It can help you negotiate a better rate. "The preapproval will act as a bargaining chip," he says. "If you're preapproved at 4.5%, the dealer says, 'Hey, you know, I can get you 3.5. Would you be interested?' And it's a good idea to take it, but make sure all of the terms, meaning the down payment and the length of the loan, remain the same."
So at the dealership, Reed and Van Alst both say, the first step is to start with the price of the vehicle you are buying. The salesperson at the dealership will often want to know if you're planning to trade in another car and whether you're also looking to get a loan through the dealership. Reed says don't answer those questions! That makes the game too complicated, and you're playing against pros. If you negotiate a really good purchase price on the car, they might jack up the interest rate to make extra money on you that way or lowball you on your trade-in. They can juggle all those factors in their head at once. You don't want to. Keep it simple. One thing at a time. 041b061a72