When you decide to obtain a car you must first select the car, negotiate the price, and then determine how to finance your purchase.
Selection of a car is largely dependent upon your personal preference. But you should still consider the following financial criteria:
â?¢ Price: stay within your budget. Paying of the finance for your new car should not upset your monthly budget.
â?¢ Insurance: some cars are subject to significantly higher insurance premiums for a variety of reasons: they could be difficult to repair after an accident, highly priced, or a common theft target, for example. So before making the purchase estimate the insurance charge.
â?¢ Resale value: a car of higher resale value would be a better choice. Though it is not possible to predict future values, you can at least check present resale values on the Internet.
â?¢ Repair expenses: review consumer reports for the car you have decided to buy. It will give you a fair idea of what you can expect in repair bills.
â?¢ Financing rate: compare the financing rates among different dealers.
When you are buying a car, you will find two main kinds of dealer. The first will expect you to negotiate, and so will start at a very high price, then let you wear them down until you believe that you are being given a great deal, while they still make a large profit at your expense. The second kind will offer a set price for a specific car to all customers. Before purchasing, shop around to make sure that you know the typical sales price for your car.
If you are considering purchasing a new car and plan to finance the purchase, you should estimate the amount of monthly payments you can afford before you go for your first test drive. One popular alternative to buying a car is leasing one. In this case you do not need a substantial down payment, and you can return the car to the dealer at the end of the lease period, which saves you the headache of resale. But you have to bear in mind the maintenance costs, and since you do not own the car, you do not have any equity investment in it.
Author Trevor H.date added 2009-08-26 09:09:02