Car Purchasing Pitfalls
What not to do
1. Not knowing your credit score. Get a free copy of your credit report and for just a few dollars your credit score at Annual Credit Report.
2. Not getting pre-approved for financing. When you are pre-approved you avoid being trapped in a higher-than-necessary interest rate at the dealer.
3. Treating the car buying process as one negotiation. “Unbundle the deal” – price, financing, and trade-in value should be handled separately.
4. Ignoring your needs. Don’t let your wants outweigh your needs or you may end up choosing flash over practicality. And trust us, the immediate lift you feel driving off the lot will fade once you start living your life in your new less than practical ride.
5. Not doing your research. You don’t need to become an expert but do your homework. It’s easy and usually free to gather basic information online – look up pricing, rebates, features, reviews, local dealers, etc.
6. Focusing on monthly payments. Sure, $400 a month sounds better than $500 but if the term is twice as long you’re going to end up paying more in interest making the final price higher.
7. If buying a used car, be sure you know everything about the history of the car, including: the number of previous owners, if the car was ever involved in an accident, any previous mechanical problems and the maintenance history of the car.
8. Not going for a test drive. Drive the car in as many different roads as you can – make turns, go on highways, etc. Pay attention to how it handles, any excessive noise, etc.
9. If you’re buying used, always get the car checked out by your mechanic. Get them write up a report on the cars condition, any repairs needed and the costs – if you still want the car, use this to help negotiate a better deal.
10. Forgetting to add in the costs of insurance. Some vehicles come with higher rates and new cars are usually more expensive to insure than older ones. The best thing to do is to call your insurance agent and get a quote.