If you are in the market for a new vehicle, make sure that you are in the driver's seat. Lemon law attorney Dani Liblang wants you to have the best possible purchasing experience. Here are some of the most important factors you should be aware of when buying a new car. Do your homework to get the best deal.
BIRMINGHAM, Mich., January 31, 2018 (Newswire.com) - First decide on the right vehicle for you and what options or features are "must have." If you are concerned about getting the most vehicle for your money, it is a good idea to have at least two to three models in mind that satisfy your needs.
Do your homework.
Once you have decided on a few vehicles that would fulfill your needs, do your homework: Check the vehicle's reliability. Visit www.safercar.gov to check for recalls and consumer complaints. Search the internet for known problems with the vehicle you are considering, e.g., "2018 Dodge Durango problems" and see what comes up.
Research the invoice price for the vehicle.
The manufacturer's suggested retail price (MSRP or "sticker") will be significantly more than the invoice price. You can find the invoice price on sites such as www.edmunds.com or www.invoice-pricing.com, or search for "vehicle invoice prices" in your internet browser. The invoice price generally represents what the dealer pays for the vehicle, though most dealers actually pay less than the invoice price. Sites like www.truecar.com can also give you information about recent sales prices in your area. Knowing these numbers will help you negotiate a fair price for the vehicle. Getting internet pricing quotes from several local dealers will also help with your negotiations.
Check your credit score.
You can check your credit score free at www.annualcreditreport.com once a year, or at www.creditkarma.com (unlimited). Consider getting pre-approved at your own bank or credit union. If you know your credit score and know what interest rate and payment terms you could get at your own bank or credit union, you'll be in a much better negotiating position. Dealers often mark up the cost of credit by charging you an interest rate higher than what the lender is willing to lend at. When the dealer marks up the interest rate (called a "yield spread premium"), the dealer gets to pocket the profit.
Dealers will often be willing to match or beat the credit terms your bank or credit union is offering. The advantage of financing through the dealer is that the bank or finance company who holds the loan will then be subject to any claims or defenses you would have against the dealer if your new car turns out to be a lemon.
Check with your insurance company.
Check with your insurance company to find out what it is going to cost you for the vehicle you are considering and whether certain options will raise or lower your premium. The last thing you want is to have signed on the dotted line for your new car and then find out that you cannot afford the insurance. Be aware that in most states it is illegal for the dealer to sell you auto insurance - if a dealer offers to arrange your insurance in a state where it is illegal (e.g., Michigan), run from that dealer.
Check for rebates and discounts.
Visit the Manufacturer's website for rebates and promotions. Also, check whether you qualify for any special buying programs that will reduce your costs. Many insurance companies, such as AAA and State Farm, and many organizations have discount buying programs that may help lower your cost.
Are you trading in a vehicle? If so, be sure to research the average wholesale or trade-in value of your vehicle. Sites such as www.nadaguides.com and www.kbb.com can give you a ballpark that will help you negotiate a fair trade-in credit.
Choose your dealer carefully.
Check online reviews. Search the internet for complaints about the dealer. Many state courts allow you to search court records to determine whether a dealer has been sued and how often (in most states, any lawsuit against a dealer would be filed in the city or county where the dealer is located). Ask friends and family for their recommendations.
When you finally visit the dealer, never negotiate based on the monthly payments. Stick to negotiating based on the total price of the car. Be careful about getting talked into add-ons that you do not need (e.g., window etching, shine protection) that can add hundreds and sometimes thousands to your purchase price. When you go can also be a factor in the price you'll pay. Visiting the dealer during a slow weekday, near the end of the month (or even at the end of the year), will usually net you a better deal.
Source: Curtis & Associates