how to know when to buy a car

Invoice price is what the dealer pays the manufacturer for the car; the manufacturer’s suggested retail price (MSRP, or “sticker price”) includes hundreds—usually thousands—of dollars of profit for the dealer.
The Fair and Accurate Credit Transaction Act of 2003 (FACTA) allows every consumer to get a free copy of his or her credit report once a year from each of the three major credit-reporting agencies (TransUnion, Experian, and Equifax).
But that doesn’t mean it’s an easy time to buy a car, and it doesn’t mean dealers are going to lie down and give the cars away.
If dealers know they are being pitted against other stores, it will be easier for you to get their best offer right off the bat, and waltzing into a dealership with a first offer already in hand gives you an advantage in negotiations.
If you come into the dealership on a midweek morning when business is slow, the salespeople are more likely to make a good deal as well.

(This should also serve to draw out any potential sentient-car crime-fighting partners, as they cannot resist wisecracking and will likely say something cute like, "Geez, buy me dinner first." If so, then you’re done: It’s all cowhide coverings and curly hair for the rest of your days.) If there’s little to no rapport between you and the vehicle at this point, just sight down the trim lines to make sure they’re straight with no fluctuations — offset doors, fenders, and uneven lines could indicate frame damage.
So why do dealerships always want to know your price, payment and trades first? Because it gives them leverage against you: "Oh, well, if we’re going to do you a favor and take this trade-in off your hands, you have to buy one of these pre-selected vehicles." Or, "Oh, you’re financing? Those aren’t our finance cars.
Check those out in advance and start looking up the models you’re interested in, then read up on each one: Comb through car sites like Edmunds, click on forum posts by owners, get the specs and find out about users’ experience with reliability — hell, go to Wikipedia and bone up on the entire history of the model and the powertrain you’re considering.
Back in school, you’d do the same amount of research for a book report on Huck Finn just because an older lady in a paneled skirt threatened you with the alphabet — you can do the same legwork for a multi-thousand-dollar purchase you’re going to entrust your life to every time you leave the house to get a burrito.
It is a good idea to bring along a trusted friend with a good background of automotive know-how to check things that you are not sure of.
After you have collected a list of what you believe the car will require you can telephone auto parts stores to check the price and availability of replacement parts.
Check the trunk of the car to make sure it is still in good condition.
Check the brake fluid, and reservoir to make sure its is not leaking.
There are many things to look for when purchasing a used car but one important factor is to give the car a physical check before making your final decision.
In the complicated world of leasing, the dealer will have the upper hand unless you learn the jargon and how to negotiate the various segments of a lease deal.
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From working mothers raising their kids in RVs to stay-at-home moms who spend their days organizing events for the Oil Wives club, meet the moms of North Dakota’s oil boom.
If you plan to buy with a loan, check your credit union or local bank quotes online to find the lowest rate.
If you are doing it yourself, get bids from several dealers, keeping the focus on the dealer’s invoice price, which you will know from your research.
Getting a pre-approved loan will give you added confidence in negotiating a good price.
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Auto-buying services, such as websites or discount clubs, make things easy with pretty good, no-haggle prices.
The Internet has made it easier than ever to find out the dealer’s cost for each vehicle and its options.
You can get a good idea of the base price (the price of the car without any special options) by visiting different dealerships and comparing prices and by using the Internet to get price quotes.
Also, remember that trying to figure out a way to buy a car that is outside your price range is really not a good idea.
When you figure out what car you want (or what cars you want to check out up-close-and-personal — think "test-drive"), there are some things you want to learn about the car(s) so that you can get the best deal possible when you’re ready to buy.
You should set a reasonable price range for the car and begin to eliminate cars that are out of that price range.
Do your homework and check out what publications, such as the N.A.D.A. Official Used Car Guide, the Kelley Blue Book and the Consumer Reports Used Car Buying Guide, list as the market value of your trade-in.
In this article, we will discuss used and new car purchasing, what you need to know before you decide to buy, how to avoid common pitfalls, getting the best price and what to do if you have a problem with your purchase.
You’ve probably seen your share of car commercials on TV and recall hearing phrases like "down payment" and "APR." Although some of the terminology may seem confusing, once you break it down, buying a car is pretty straightforward.
The first thing you must decide before you begin your automobile research is whether you want a new car or a used car.
Have you ever dreamed of owning your own car? Imagine driving down a tree-lined street with the windows down on a sunny day, a warm rush of air streaming through your hair… OK, snap out of your reverie.
But remember, the most common car-buying horror stories do involve the purchase of used cars.
Use Bankrate’s rate search tool to see current interest rates and also check with local lenders, including credit unions, which are 1 percent to 2 percent lower on average than conventional banks.
Use a vehicle information source like Kelley Blue Book or to see what incentives are being offered to dealers on the models that you are considering and then ask the dealer to share that cash incentive with you by further discounting the price.
Your car research should have included the invoice price for new cars or wholesale price for used cars, as well as the manufacturer’s suggested retail price for new cars or the dealer’s asking price for used cars.
In addition, many automakers also offer discounts based on the person that is buying the car as well, such as students, members of the military and even members of certain credit unions.
Choose cars that are at least 5 percent less than your monthly budget to give yourself some room to cover costs such as fuel, insurance, repairs and maintenance.
Buying used means you can get a more expensive car for your money, but the trade-offs include not knowing the car’s history, a shorter warranty period during your ownership and higher interest rates.
Allocating no more than 20 percent of your monthly household income for all the cars in your household is a good rule of thumb for car buying.
Buying a new car means you’ll get less car features for the same money, but you get the benefit of the full warranty as well as often free maintenance and roadside assistance, not to mention lower interest rates.
While you may be drawn to a certain car or brand because of an ad for a low interest rate, it’s of no use unless you qualify, and only about 10 percent of car buyers qualify for the zero-percent and low-interest-rate deals automakers offer.
Don’t let your eagerness to test drive the cars that interest you find you at the dealership too soon.
When you do start to discuss price, keep in mind all the discounts you researched and forget about trading in your car as part of the deal for the moment.
Make sure you do your research about your current car’s value online in advance so you know whether you are being offered a fair price.
Clever salespeople want you to focus only on low monthly payments because it gives them room to inflate other variables, such as the loan interest and length.
Pay for the car in cash or get your own financing if you can, but don’t reveal how you’re going to pay until after you’ve negotiated down the total car price.
A former car salesman unveiled on The Consumerist how that shell game is played: You’re put on the defensive and worn down with tricky math, while the salesperson appears to knock down prices.
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For this price range, it might be a good idea to look for a small or mid-size car, as a pickup truck or SUV with average driving of 15,000 miles per year will cost you more than $4,000 a year in gas alone.
More likely, you can find a vehicle in this price range sold by an independent used car dealership or a private owner; some new car dealers also may have a few cars within this price range on their lots.
For $10,000-20,000 you can buy a nice 3-4 year old vehicle in good condition that can last for another 4-5 years without major problems.
For example, if you want to buy a three-four years old Toyota Camry, search the Autotrader website for a used Toyota Camry in your area limiting the search within your year range.
Your search result could return for example, around 70 cars with the average price of around $15,000.
I have had and used over 10 of their cars, as well as some other brands cars, like a associated b4, losi mini t, and even though they are totally different styles of cars, they all have shown to be not as reliable as traxxas.
HPI, Tamiya, Traxxas, and many other brands offer great cars and trucks.
Traxxas is a good brand and they do have a ton of parts available especially at my local hobby shops but I must disagree with you opinion on Associated.
HPI cars are not all that popular, mostly because they are as expensive as Traxxas but not as good quality.
Now that you know the brands and types of rc cars its time to decide if you want to go with electric or nitro.
Some brands as a whole may be better, but I don’t think it is realistic to say brand X makes the best cars hands down.
Out of all of these, Exceed cars are the cheapest, but they often require spare parts and a rather high level of maitenence.
For example, if you have a very good credit score, you could get financed for a very low interest rate, saving you a lot of money in interest payments over the life of the loan.
Along the same lines, some auto lenders won’t allow consumers to purchase a vehicle without a down payment if they don’t have a good credit rating.
ReadyForZero builds free online tools to help you pay off debt faster and protect credit.
You can shop around at other auto dealerships, as well as checking with local credit unions, or banks to see if you qualify for a better auto loan directly from them.
Any amount of down payment you put towards the loan will mean more money in your pocket every month and more of a chance of getting approved for a loan in the first place.
Regardless of your financial situation, see if you can avoid a long-term auto loan (i.e. stay away from 72 or 84 month loans as you will end up paying high interest rates).
You also want to beware of being pressured into buying any extras when you purchase your care — like an extended warranty or credit life insurance.
One is that if you miss a payment or default on the loan it will not only hurt your credit but also your cosigner’s credit.
You can improve your chances of getting a low interest rate significantly by boosting credit history and proving that you’re a smart buyer.
Practical Money Skills for Life, a free personal financial management site sponsored by Visa Inc., contains a comprehensive guide to considerations for buying or leasing a car ( ).
If you do decide to lease, always try to negotiate a lower initial sales price for the car, because your monthly lease payment is largely based on the difference between this price and what the leasing agency thinks it can sell the car for when the lease expires.
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Algebra ->  Customizable Word Problem Solvers  -> Finance -> SOLUTION: Barbara knows that she will need to buy a new car in 2 years.
How much should she invest now at 6%, compounded quarterly, so that she will have en SOLUTION: Barbara knows that she will need to buy a new car in 2 years.
because the bulk of money in a dealership is made on the back end… by service contracts and financing kickbacks….. financing institution offer dealers “BUY rates” for specific customers and delares kick this up to make more money…… the financing comapny and the warranty company come to the dealership and emand money back when you pay off the car with cash or your other fonanacing…… they knocked the deal down to bare minimum and sometimes loss to make what they think is more money on the back end….
It took a bit of time to find a dealer willing to work with that price, but I ended up paying substantially under the invoice listed on Edmund’s and got a couple hundred dollars’ worth of free options owing to the fact that the dealer had to do a swap to get the car in the color I wanted, and the swap had some more goodies that I wasn’t willing to pay for but was quite willing to accept at no cost.
If you can find one of these dealers and don’t like the negotiation process do yourself a favor and find a “true” no haggle dealership, be armed with model information, maybe write down or phone in the VIN to a service that can give you price and history.
One other tip – if you don’t have a trade and have your outside financing already buttoned up, e-mail multiple dealers in your area and solicit “all-inclusive, out-the-door” prices on the vehicle you want.
Whether you already got financing from your bank or you’re planning on financing through the dealer, you should walk in there and ask them what the cash price is for the car, also known as the “out-the-door” price.
One trick I’ve noticed here in Arizona is that they advertise vehicles on eBay for a certian price, then when you call they say, “sure, that car’s right here on the lot!”, but when you come down it’s always “just been sold by another salesman”, and they try to upsell you on another vehicle.
The dealer has tools in their pocket, asking you questions about things in this order, what vehicle, what kind of trade in, then “payments”, then the vehicle price, then surprise you at the end with dealer fees.
Does anyone know if buying from a Ford dealership using their X-Plan is really a legitimate way to avoid all the nonsense as described here? Supposedly if you can get an X-Plan pin number, you can get the vehicle for a significantly lower price than through haggling, no extra dealer fees are tacked on, and you are still eligible for any incentives that are in effect.
That’s close enough, right?” They’ll nod their head (another psychological trick to get you to agree), and almost every time the person says “Yea, that’s fine!” The problem is, they didn’t realize that a $10 payment bump over a 5-year loan nets an extra $1k in profit for the dealership.
@kenposan: The last two cars I’ve bought I told them that if they didn’t remove the dealer name sticker and the license plate runner advertising the dealership I would walk (and i was serious about it).
I had my eye on one sedan in category 1 (lowest kilometers)but concentrated the dealing on the two category 2 cars, got it down to a very nice lower price with a couple of the ‘back-and-forth’ trips to the manager, discussed financing, down payment and monthly payments through the dealer,etc.
We went through a couple of rounds of haggling, then I noticed on their form to get my price down there was a first time buyer discount, and a factory rebate for nearly 4 grand, I was like, ‘where did this come from’, and they were saying that they were trying to make the deal work, I cried B.S. about them wanting money down and trying to screw me out of 4 grand, and got ready to walk.
Now, lets say you’ve got a problem with the trade price, as well as the other figures (other than price.) The salesman (and manager) will probably agree to whatever price you want for your trade, within reason.
At the heart of it all is the “4-square,” a sheet of paper (sample above) divided into four boxes: your trade value, the purchase price, down payment, and monthly payment.
Grown men will melt and sell their souls for a briefcase full of 20-dollar bills, even when what they are getting is half of their asking price.) I just kept pointing at my “firm” price soaped on the windshield, and told him I’d seen much more cash than that before.
A good place to look is at the web forums, sometimes you’ll find an employee from a dealership will post the real dealer price sheets.
Will you accept this offer?” 4 out of 6 dealerships tried to get me in or came back with a higher price, but 2 said, “yes, we agree.” I responded that, pending a test-drive, we’ve got a deal.
What were you looking to pay on the car for payments?” You respond, “I didn’t plan on paying that much, must less more!” The salesman will pause, hoping that his last line will sink in a bit and you’ll either acquiesce to the current number or offer something higher.
If you are able to make early payments, there’s usually money to be saved by going with a simple-interest deal, but you should really look at each loan on its own merits – sometimes the dealer financing *is* a better deal, particularly if you can’t make early payments and the manufacturer is subsidizing a ridiculously low interest rate.
If you want the difference to be $5,000, it doesn’t matter if the dealership writes the purchase order as Trade value = $100,000 or trade value = $1, as long as the total price on the bottom line is $105,000 or $5001.
Your pre-approved remember, when you close the deal, they will write the invoice up such that if you don’t bring in your check from the credit union within a week to 10-days then you’ll automatically get a dealer financed loan.
If you are interested in a Volkswagen, definitely ask “Will you order what I want, for the price negotiated?” If they say no, or tell you they can’t do custom orders, call someone else.
Another thing I do is go to carmax and get their no haggle offer on my trade in and make the dealer I’m really working with give me at least that price.
Pick a vehicle you would buy, write the VIN on the contracts and tell the dealer to write on the back of sales contract (the true legal purchase form you will be signing) every fee EXCEPT the vehicle cost as a line item with the words “dealer determined fee” or “exact fee required by law”.
I punched in some numbers and found he was really trying to rook me over on the deal – 15% interest? On 50% down? That’s all they can do? Well, we got the car for a VERY good price but really crappy financing terms.
I then went to the dealership, and when I was ready to negotiate, I told them how much I wanted to pay for the car (I had a check from the credit union on me already), which was actually the price that Consumer Reports said the dealership paid for the car.
You don’t have to deal with scummy salesman, only people on your level – people who have as much experience buying and selling cars as you do – and most importantly, people who either aren’t smart enough or don’t care enough to scam you.
Let them go to the manager and “work it out”, I did this and stuck to my guns – I ended up getting the car for $20 less a month than the other dealership as an “incentive” for going to them.
After getting suckered a few times we learned to get financing beforehand (never had to use it because the dealerships always managed to find a lower rate, they wanted the business more than our finance company) and focus intently on the asking price and base all other negotiations off that.
Once you’ve got the trade in and purchase price where you want them, then you offer to let them beat your pre-approved financing.
Most people, at this point, will write the check – if the salesman is good enough with the snow job, people will honestly think that they’re getting a good deal and that they need to do everything they can to get the manager to cave and sell them the car for next to nothing.
After hemming and hawing, Mr Salesgenius says something like “wow, thats a LOW price, you’re already getting a REALLY GOOD PRICE here.” As if, apparently this will prevent me from future negotiations.
I worry when I hear people say, “I got it for $X less than MSRP!” – you should NOT be negotiating down from MSRP, but up from the invoice price.
Last time we bought, he sneaked a 10.9% interest rate into the contract when the agreement was for 4.9% (he then blamed the sales manager for the mistake even though the finance office prepared the contract), then he doubled the value (and tripled our cost) of an extended warranty, pure gravy for the dealership had we not noticed.
Unless you buy the car at the end of the lease, you will never have any equity in a car and may fall into the pattern of interminable monthly leasing payments without ever owning any vehicle.
Kaye, Lease Your Car For Less: The Consumer’s Guide to Vehicle Leasing (1989).
For a lease to match up with a sale, the amount the lease uses for the car’s initial value must be no higher than the amount you would buy the car for plus the implicit interest rate must be no higher either.
Facts for Consumers: "Truth in Leasing" (November 1994) and "A Consumer Guide to’ Vehicle Leasing" (February 1992), Federal Trade Commission Office of Consumer! Business Education, Washington, D.C. 20580.
If you lease, you will put less money up-front, may have lower monthly payments, and will not have to later trade-in or sell the car.
* Lessors will not tell you the interest rate you are paying on the lease, even though the lease payments are computed based on an interest rate.
But when you lease, the dealer often hides from you how much you are paying for the car, and this price may even be higher than the car’s sticker price.
* If you want to have the option to purchase the car after the end of the lease term, have the lessor show you the purchase option price.
It may be hard, but try to find out upon what car price the lease payments are based.
But when you walk into the dealership the salesman tells you about how you can lower your monthly payments by leasing and also that you will not have to worry about selling or trading-in the leased car in the future.
Negotiating a lease is more complicated than buying a car because often the terms and price calculations are confusing or not fully disclosed.
"Or Should You Lease Instead?" 59 Consumer Reports 259 (1994 Annual Auto Issue) (April 1994).
* If you trade-in your car for the lease, make sure the money for the trade-in is clearly written into the lease and have the dealer show you how that money is calculated into the lease.
I really liked this article but since it’s titled “No Credit History?” I think it’s a little backwards to put in the first paragraph about getting your credit history, but you’re obviously aware a person reading this has no credit history.
Prepare yourself for your next car buying experience by visiting where you can view finance programs and offers tailored to meet your needs and learn more about understanding and protecting your credit, differences between buying and leasing, and various vehicle protection plans.
Co-signer: Got a family member with good credit willing to risk getting stuck with the bill if you miss a payment? Should your account ever go to collections, guess who they can go after-your loving and trusting co-signer.
OK, so you have your credit reports and credit score, you know how much you can afford, you’ve researched rebates and special offers, and you have all your paperwork together.
Interested in a Yaris, Matrix, Corolla or a Tacoma? Check out the iFinance program at You’ll need 10 percent down, a steady job, car insurance, references and a minimum income, but you won’t need a co-signer.
After all other expenses, how much can you really afford to put toward a car payment, insurance, gas and maintenance? You’ll be a more attractive buyer if you can provide a decent down payment and keep your car payment to a low percentage of your monthly income.
The dealer will pull your credit reports, so make sure they are accurate and that you’ve taken care of any outstanding problems.
Play with the numbers and remember a lower annual percentage rate (APR) with longer terms will give you lower monthly payments – the flipside is that you’ll pay more in interest over the life of the contract.
You may know people who decided to buy a car, only to find that they couldn’t afford to because they were "upside down" on their current loan.
If the dealer offers a good interest rate, find out what credit score you need to qualify for that rate.
New car buyers often don’t consider the higher costs of repairs and maintenance for certain models, tires that cost twice as much as those on other cars, higher gas costs, and higher insurance (depending on make, model, and even color).
Does it have a history of problems with the transmissions? Brakes? Electrical systems? What does it cost for routine repairs and maintenance? You can find all this information at .
Know ahead of time what rate your own bank (or any bank you choose) would give you on a new car loan before you decide between a bank and the dealer.
You can also find out about rebates and deals that manufacturers offer but the dealer doesn’t tell you about (instead they pocket the savings meant to be passed on to you, the buyer).
A $2,000 rebate on your new car may sound good, but are you sure it beats the low-interest-rate deal the dealer may offer as an alternative? Don’t be fooled by the lure of cash upfront.
If you try to sell your car before the loan term is over, you may find that the car is worth less than you owe on it.
Don’t find out too late that you can afford to buy the car, but you can’t afford to own it, due to operating expenses, insurance, gas mileage, annual excise taxes, and other costs of ownership.
It’s not uncommon for new car buyers to be quoted a rate, complete the paperwork, and drive away in their new car only to get a call a few days later saying they didn’t qualify for the rate quoted and their payment will now be so much more per month.
Gradually the term became longer to enable more people to qualify for loans they couldn’t really afford, by lowering the monthly payment.

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