Procedures in Buying a Car

Buying a car typically involves more than breaking out the checkbook or credit card and driving home. Widely recognized as the second-most expensive purchase people will make beyond their homes, cars come with their own checklist that should be met before completing the credit check and paperwork that precedes driving your new car home.

New Car

Once the decision has been made to purchase a new car, buyers should determine the exact make, model, color and features desired, then explore the marketplace. The Kelley Blue Book is one of the respected sources to use in determining fair market value. Car buyers can then call multiple dealerships within their region to determine the general availability of the desired car. Those seeking hard-to-find-colors and features, for example, will find they have less leverage in negotiating a favorable price. Once the right car is found, prospective buyers can often negotiate the price by telephone or e-mail, as well as determine an approximate range for the value of any trade-in.

Used Car

With increasingly savvy buyers emboldened by both competition and the Internet, respectable used-car dealers are generally mindful of educated consumers. And used cars are widely available for significantly lower prices than new, without the inevitable depreciation to bear. According to Edmunds.com, "Even cars that are only a year old are 20 to 30 percent cheaper than brand-new cars." Once a decision has been made on the appropriate car, buyers should consult a source like Kelley Blue Book to determine the fair market value, check whether the car is still under factory warranty and secure insurance, which is cheaper for used cars. Buyers should also check the car's history by consulting a source like CarFax or the local Department of Motor Vehicles.

Leasing

Leasing a car has become an increasingly popular option. For fixed monthly payments, consumers can transition to a new car every two to four years without the extra time and sometimes hassle of selling the car or trading it in when the time comes to change. Those wishing to lease should look at their driving habits to determine the expected miles put on the car each year, then craft the lease to accommodate that. They typically come with annual mileage allowances from 10,000 to 15,000, with generally steep per-mile charges over that figure. Once determined and the desired car found, the typical credit and income checks conclude the process.

Buying

For those in a position to buy the car outright, private sellers will typically ask for a cashier's check or cash. As a buyer, it is best to take the former route to have a documented record of how much was paid and when. Auto dealers have access to various financing options, and typically provide a range of choices for buyers at the time of sale, once the car model and features have been set. Buyers would also do well to contact their individual banks to check on special auto financing rates, which are often provided to valued customers.

Buying from a commercial seller also opens up the possibility of using a credit card to pay for the vehicle. This can be convenient, although if any of those funds will not be immediately repaid, the cardholder should verify the interest rate to avoid paying far more in interest than with a traditional auto loan.