Avoid the Most Common Car Rip-Offs

car finance

Buying a car is an important decision for your financial future, and it should never be treated lightly. Do not go car shopping like you would go shopping for any other product – impulse buying is extremely dangerous when there is such a large amount involved. Research your options before visiting the dealer – decide exactly how much you can afford to spend, what you want to buy, and which are your financing options. If you go into the negotiations unprepared, you will get ripped off – the dealers can smell an undecided customer from a mile away.

If you need to borrow the money for the car purchase, bear in mind that credit unions usually have the best interest rates on auto loans, followed by banks. Consider other sources of financing only if you do not qualify for these options. Also, avoid stretching the loan over a long period of time. Dealing with high rates can be a pain, but you will save up a lot of money on the long run if you pay off the loan as soon as possible. Usually, a car loan with a term longer than seven years is a complete rip-off.

Pay attention to all the charges – most often than not, the price of the car is not the entire price of the deal. There may be transport and delivery charges, or setup and preparation fees, so ask your chosen dealer about what these mean, and don’t hesitate to haggle. Don’t worry, they will still make a profit at the end of the day, it doesn’t mean you have to accept everything they charge you.

Consider leasing, but make sure you understand everything and research your options carefully. Leasing is becoming more and more popular, and it has a wide range of advantages, but there are also a lot more details to consider when entering such a deal.

Car dealers are exceptionally skilled at pushing options you don’t need. From heated seats and retractable sun roof, to extended warranty and credit life insurance – all these add up quickly, once the salesman convinces you that they’re absolutely essential, or maybe not essential, but they will still make your life so much better for a very small charge. Stand your ground during negotiations, and make sure you only pay for what you want. If you know you can’t resist the pressure, take a friend with you – who can simply say “no” every time the dealer comes up with a new suggestion.

In most cases, the trade-in option is not a good deal for you. The dealer knows exactly how much your old car is worth, and will offer considerably less, to insure they still get a good profit at the end of the day, after re-selling it. You can simply sell it yourself, and use the money as an advance payment on the new car, and you will be better off. Of course, this depends on your situation, on how much time you can spend on this, and on how much you know about cars – not to mention the condition of your vehicle.

Buying a new car is an important decision, so don’t rush into it. It may take more than a day, and visits to more than one dealer in order to find what you’re looking for. Overall, it’s best to postpone the decision by a few days even if you’ve already made up your mind. Just leave and sleep on it, and return when you’re absolutely certain. In the meantime, the dealer may also have a change of heart and be willing to lower the price even more.

Once you have your new car, make sure you do not skip its regular maintenance. It may be pricey, but, on the long run, it will save you a lot of money, avoiding frequent breakdowns. Don’t rely on the fact that the car seems to be working fine for now – the regular maintenance is there for a reason, so don’t ignore it.

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