New Car Buying FAQ

Buying a new car is a major investment, and it helps to have your questions answered before you head out to the dealership. New cars can come with rebates and incentives, but they can also come with additional fees if you are not careful. Take the time to do some research on how to buy a new car before you try and tangle with a car salesman.

What Car is Best for Me?

Talk to family and friends about their cars and evaluate the feedback you get. Read about the newest models and features in car-buying magazines and on car-buying websites. Online resources such as Edmunds.com can provide advice on comparing models and features. Understand the differences between the various models before you set out to test drive anything.

Should I Trade in My Old Vehicle?

When you trade in your vehicle you will get what is referred to as the trade-in value for it. The trade-in value can be different among dealerships but, as a general rule, you can get more for your vehicle if you sell it on your own. If you still owe money on your vehicle, don't trade it in; if you do, the dealership will roll the pay-off amount into your new car loan. This means the remainder of your old loan gets added to your new loan and raises the cost of your new vehicle.

Should I Finance Through the Dealer?

This depends on the deal being offered by the dealership. Some auto sales incentives include financing with very low interest rates. As long as there are not any additional fees loaded into the deal, you can save money. That does not mean you should not shop around for financing. Get pre-approved by your bank so you understand your spending limit and your monthly payments, and then ask the dealer to beat your financing. Either way, you stand to get the best deal possible.

What Price Should I Pay?

The retail price will be listed on the sales sticker in the car window, and that is the price the dealer will try to get you to pay. Ask to start negotiating at the dealer invoice price. You can find invoice pricing at websites such as Cars.com and others like it. The dealer may supply you with his invoice price, or he may refuse to show it to you. The dealership needs to make a profit to stay in business, but if the salesperson will not start negotiating at the invoice price, find a new dealership.