Buying your first vehicle can be a huge life milestone. Before you walk into a dealership to close the deal, there are a few things you should know and have planned out as a first-time auto buyer.
Know Your Monthly Budget
Long before you purchase a vehicle, figure out what your monthly budget could be for your vehicle. This can help you narrow down your initial vehicle search and ensure that you’re looking at cars, trucks, or motorcycles that are within your budget.
Mapping out your monthly budget can also help you see how much money you can afford to put as a down payment right now. As a general rule of thumb, the larger the down payment, the lower your monthly payment could be on the vehicle for the duration of the auto loan term.
Do Online Research
Online research can help you narrow down some vehicle makes and models that are within your monthly budget whether you’re interested in purchasing a new or used vehicle.
While it is unlikely that you will be trading in a vehicle when you are a first-time auto buyer, if you are in a situation where you were handed down a family car to trade-in, you can do online research to see what a fair trade-in price would be for that vehicle. Familiarizing yourself with tools like Edmunds or Kelley Blue Book that report on the values of vehicles could help you be prepared to utilize these tools in the future when you are trading in a vehicle to purchase a vehicle.
These tools can also be used for online research to make sure the car dealership is asking for a fair price on the new or used vehicle that they are trying to sell you. If they are asking too much, cite your research and you can try to negotiate a better price.
Explore Financing Options
While most dealerships will offer financing options in-house, you may be able to find a better auto loan option with a better interest rate from a private lender, like a credit union. Most lenders offer pre-approvals so you can see what auto loan you will be approved for as a first-time auto buyer before you visit the dealership. This could improve your negotiating power at the dealership.
While this is nowhere near a comprehensive list of all the things you should do prior to purchasing a vehicle, as a first-time auto buyer, these tips will help set you up for getting a fair and successful deal at the dealership when it comes time to purchasing your vehicle.
Do you need help learning about financing your car? Let us know!
Let Camino help you. We want our members to find the best option that works for their needs. We offer competitive auto loan rates. Please go online at caminofcu.org, give us a call at 800-835-3400 to speak with one of our Member Advisors, or contact us for more information.