Set a Budget
Before you start looking for your dream car, evaluate your financial situation and what you can reasonably afford for a car payment. Remember that the cost of buying the car is only part of the commitment: you’ll also have registration, taxes, repairs, insurance, parking, and gas to pay for. Experts recommend keeping all car-related costs below 20% of your monthly take-home pay.
Credit unions and banks will often offer lower interest rates than car dealerships. Talking directly with a lender such as a credit union can also help you understand better how much you can afford to borrow. Knowing ahead of time how much you will be able to borrow will prevent you from looking at vehicles out of your price range.
Do Your Research
It’s crucial to research features, models, and local price ranges before going to a dealership. Choose at least 2 vehicles for comparison that will help you pick out what you’re really looking for. Look for sale events and holiday discounts to time your purchase and save money. And don’t forget that Signal offers a car buying service that helps members find cars and get guaranteed pricing without the haggling.
Form vs. Function
Most people would prefer a high-end vehicle over a basic one, but how sure are you that the beautiful car or truck you’re considering will also be reliable and low-maintenance? Ask yourself what your main needs are for the vehicle: commuting, long road trips, occasional use around town, or driving people or equipment? Once you know your main priorities, then evaluate whether you can afford a high-end version of that vehicle.
Choose dealerships that are reputable, and be wary of pressure tactics, long waits at the dealership, or add-on items you’re not sure you need. Don’t be afraid to walk away when your offer is not met or you’re uncomfortable with the salesperson. There are plenty of cars out there to find what’s right for you—getting the right car might mean declining a few others first.
Bring an Expert
If it’s your first time buying a car, take a family member or a friend who’s a car expert with you to help you get the best deal. An experienced buyer will be able guide you through the process with less stress.