8 Mistakes First-Time Car Buyers Make
- You didn’t do research
After buying a house or business, purchasing a car could be the second- or third-largest purchase you make in your entire life. Wouldn’t you want to make sure you did a little homework before taking the dealer’s advice on everything? Researching the reliability of the manufacturer, reviews of the car you’re examining, and customer feedback from those who own the same car gives you a better understanding about what you’ll love or hate about the car you’re considering.
- You didn’t have a budget
It’s easy to focus on the monthly payment, but what about the hidden costs of owning a car? Have you factored the cost of gas, insurance, and repairs outside of the warranty? And if you’re financing your new car, don’t forget the interest you’re paying toward the principal amount. It’s worth busting out a calculator and crunching the numbers to make sure you can truly afford your wheels.
- You didn’t visit multiple dealers
When you walk onto a lot, car dealers want to sell you a car. These are salespeople, not your best friends. They want to help you uncover a deal, but it’s worth shopping around to know if their “once-in-a-lifetime bargain” is just that. (Secret time: It’s likely the line they use on every customer.) Even if the price is the same across multiple dealers, won’t you feel better knowing you double-checked?
- You only considered a new car
Buying your first car doesn’t mean having to buy a new car. Used cars represent a great option and could also mean significant savings. New cars lose up to 20 percent of their value within the first year and depreciation starts the moment you drive it off the lot. Instead of throwing thousands of extra dollars at the most eye-catching car, pocket that money and opt for a car that’s been gently used.
- You didn’t get the details on the used car
Used cars may be a great option, but don’t discount the possible problems associated with them. The Insurance Bureau of Canada offers a free VIN check to see if a car has ever been reported as flood-damaged or nonrepairable. It’s worth checking to see if there are any open recalls on the car as well. These issues are sometimes left unrepaired by the dealer – which passes the repair costs back to you, the consumer.
- You skipped the test drive
It’s easy to get excited about signing the dotted line and driving the car off the lot … but didn’t you forget something? The test drive! It can be the most exciting part of the entire car-shopping experience, so insist on making it happen. Ensure that the car you intend to buy is the one you drive. It’s possible the dealer might suggest looking at a model that has upgrades (e.g., engine, entertainment system, comfort systems). This doesn’t give you the true feeling of what it’ll be like to drive your car.
- You focused on style, not substance
Large cup holders, plush seats, multiple air vents, six or even eight speakers … it’s easy to get caught up on the creature comforts car manufacturers add to today’s vehicles. But aren’t there other factors that should play a bigger role? What about fuel economy or safety ratings? How does it drive? It’s easy for a car to feel like a toy, but don’t forget that it’s a tool to help you get from location to location without incident.
- You didn’t look at outside financing
Once you’ve negotiated a great price for the car, someone from the finance department within the dealership gets involved. They’re crunching the actual numbers to figure out what your interest rate and total cost of payments might be. You’ll only be able to negotiate better financing terms if you’ve examined options from bankers or other lenders. Remember, dealer financing isn’t your only option!
If even one of these steps helps in your car-buying experience, you’ll have avoided learning that lesson the hard way. Car-buying should be a fun experience and if you come prepared to be the driver of it – and not just a passenger – you should feel good about the end result too.