Purchasing a car can be intimidating if you do not know much about them. Whether you are looking at cars on dealer lots or those sold by private sellers, it is important to make sure the car works well, fits your budget and gives you the gas efficiency you need. By planning ahead, you can make a car purchase with confidence.
Your Car Buying Budget
If you are going to finance a car purchase, Consumer Reports states you should make sure the monthly car bill is no more than 36 percent of your income. Before you start car shopping, know how much you can afford to spend on a down payment, which will affect your monthly payment. Additionally, remember to factor in the interest rate, which will change the overall price of a car.
Auto Loans
If you cannot pay cash for a car, you can seek financing from a dealer or a financial institution, such as a bank or credit union. However, you do not have to finance a car through the dealership that sells you the vehicle. As part of your homework before you go car shopping, get quotes from your bank and any dealerships that interest you to see which offer the most overall savings. In a quote, make sure the lending institution factors in your down payment, fees and interest rates.
Car History
When you are interested in purchasing a used car, always examine the car's history report. You can request these reports from dealerships, who should not charge you for one. Additionally, motivated private sellers should not have a problem with you asking to see a history report free of charge. A vehicle history report tells you about the number of owners a car has had and information about past auto collisions and claims.
Consider Insurance Prices
When you find some cars that peak your interest, talk to your auto insurance agent first. While a car may have an attractive price tag, the cost to insure it may break your bank. By using information about the cars you like, your insurance agent can give you a quote for how much it will cost to insure the vehicle. Information your agent will need includes the year, make and model of the car, the vehicle identification number and any features the car may have, such as anti-lock brakes or a special stereo system. According to Bankrate.com, a car that is more expensive to fix will have generally have higher insurance rates.
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