The average age of cars on the road – a record 12 years – indicates that more drivers than usual may be in the market for a vehicle this year. If one of those drivers is you it’s time to sharpen your car buying skills before you walk into that dealership. Knowing your way around the lot can mean thousands of dollars in savings for the prepared consumer. Here are some 2011 car-buying tips that put you in the driver’s seat.
KNOW YOUR BUDGET: All of your household’s cars and expenses should not exceed 20 percent of your monthly income.
DON’T THINK YOU HAVE TO BUY USED: Demand has driven up used car prices, and loans can come at a higher interest rate. Consider a less expensive new car purchase. Twenty models this year have sticker prices of $15,000 or less.
NARROW YOUR FIELD OF INTEREST BEFORE WALKING INTO THE DEALERSHIP: Research your choices. Consult the automaker’s websites and authoritative guides such as Edmunds.com, Kelley Blue Book (KBB.com), and NADAguides.com before saying “Hello” to your first salesperson.
LOOK AT THE TOTAL COST OF OWNING A CAR BEFORE COMMITTING: Beware of payments that take up your entire monthly auto budget. Remember to figure in fuel, insurance, maintenance, and repairs.
CALCULATE EXACT INSURANCE COSTS FOR EACH VEHICLE YOU’RE INTERESTED IN: :Ask your agent for a quote on each one. Remember make, model, engine size and options all impact your rate, as does your driving record and whether there is a teen driver on the policy.
SHOP AROUND FOR LOANS: Even if you get a low-interest deal from the automaker, you might be better off with the cash rebate and an outside loan.
SHOP FOR THE BEST INTEREST RATE: Zero-percent financing sounds great, but only about 10 percent of buyers qualify. Check out rates ahead of time especially from credit unions, which could be 1 to 2 percent below bank rates.
GO IN KNOWING THE INVOICE PRICES: Visit those third-party websites, and print out invoice prices for the cars you are interested in along with their preferred options.
CHECK INTO REBATES AND OPTIONS: Recent college grades, students, the military, and some credit union members can get special deals. Check out the financing section of the automaker’s website for an up-to-date list.
LOOK FOR DEALER INCENTIVES: Dealer incentives are often $1,000 or more, depending on how eager an automaker is to get rid of some brands and models. Check incentives online at Kelley or Edmunds because you can’t ask for them if you don’t know them.