There are many different things to consider when it comes to buying a car. It’s rarely a good idea to purchase a vehicle without doing any research. What do you need to know before buying a car? Read on and make sure you know the answers to these 10 questions before purchasing your next vehicle.
1. What are my car financing options?
Before deciding to purchase a vehicle, whether new or used, understanding your finances and what you can and cannot afford should be the first thing you look into. Checking your finances before buying a car will help you figure out ways you can make improvements to your credit score and savings.
If in good financial standing, talk about your options with an auto lender to understand what type of price range you are working with and what is an optimal payment plan for you. This will also help you get an idea of the kind of deposit you can put down on your new car!
2. What is the difference between a loan and a lease?
Similar to understanding your finances before buying a car, it is essential to understand the difference between a lease and a loan. Leasing a vehicle means making payments for a fixed period of time at an agreed amount of money; the agreed amount of money is less than the full price of the car. It's similar to renting in the sense that at the end of your lease, you don't own the car.
Second, an auto loan means that you own the car and are making payments for a fixed period of time until the price of the car is repaid in full. Consult a financial advisor or lender to discuss which option works best for your needs.
3. How does my credit score affect buying a car?
Credit scores are a three digit number assigned to each person with a credit history. This number indicates your ability to repay a loan to lenders. Various factors go into determining what your credit score is. Overall, having a good credit score can help you get approved for a loan and help qualify for a lower interest rate!
4. What factors should I consider when deciding which car to buy?
Deciding the make and model of the car you want to buy may be a challenging task. There are many different things you can consider when it comes to choosing, such as size, miles per gallon, capacity, and more. Research the types of cars you are considering and look into what they have to offer. If the model you're interested in has had a history of recalls and frequent repairs, it may be time to start looking into a different type of car. Evaluate your options and find a car that is going to suit you best and fit within your purchasing budget.
5. Why is comparing car deals important?
Once you know the type of vehicle you're in the market for, start shopping around online to see what local dealerships offer. You may be able to find more than one of the same car in your area. However, you want to find the best vehicle for the best price. Some dealerships may offer exclusive deals and warranties that other businesses may not.
Don’t forget that there are other options besides dealerships. If you are going to purchase from a private party, be mindful of the risks.
6. Should I trade-in my old car?
If looking to trade in your vehicle, figure out what your car is worth before speaking with a salesperson. Knowing your car's worth will help you understand the type of offer you should be receiving from a dealership. Do some research online to find your car’s estimated trade-in value.
If you have the option to trade in a car, consider it! This is a great way to reduce the overall purchase price of your new vehicle.
7. Why is it important to know a car’s history?
If buying a used car, make sure to ask for a vehicle history report. You may not want to buy a car that has a previous history of accident reports, multiple repairs, multiple owners, or other specific incidents that are unique to the make or model of the car. If the seller doesn't want to provide the history, it may not be the best idea to purchase from them.
8. Why should I test drive a car before buying?
When trying to decide which vehicle you would like to buy, always test drive a few options. Test driving will help you determine if this car is the right match. For example, does the car ride smoothly? Is it comfortable for you to ride in? Is there anything else that you may not like? At first sight, you may have completely fallen in love with a car; however, when you start driving it, it may not be what you expected. If buying a used car, when test driving, really pay attention to how the vehicle operates.
9. Should I get a second opinion?
When purchasing a car, it is always a good idea to get a second opinion on the condition of the car and what maintenance will be going forward. If you have a mechanic that you trust, ask them to look it over. Taking the vehicle to a mechanic may cost a fee. However, it could save you a lot of money in the long run.
It's better to be safe than sorry when it comes to purchasing a new car. If the seller refuses to let you get a second opinion, there may be an underlying issue they're hiding.
10. What other types of questions should I ask when buying a car?
When purchasing a vehicle, it's important to ask the right questions to understand what type of vehicle you are buying! Below are some great questions to ask the salesperson or private seller before you purchase your new ride.
- Does it come with an extended warranty?
- What are some common repairs?
- Are there any additional hidden fees?
- What is the gas mileage? Also, how many total miles are on the car?
- What amenities does the vehicle come with?
- Can I take the vehicle to my mechanic for an inspection?
- Can you trade-in my vehicle?
- What is the owner history?
- How well has the car been maintained?
- If buying from an individual, why are they selling?
💳Do you understand credit scores? Learn the basics in Credit Scores 101.
🚗Saving for your next car? Check out 6 Smart Ways to Save for Your Future!