A lot of news sites are doing a lot to report about the current economic cycle and the poor quality of the economic environment around the world. In addition to housing loans and credit markets, cars loans are obviously the next large monetary groups and though we all know it’s going to be tougher to get credit to purchase a new car when our current model becomes inadequate due to life changing events (births, new jobs, death, etc.), you have an accident or you need a new ride because you just got a raise and want to upgrade. Below is an analysis of the number of ways you might be able to get a great deal on a car or at the very least, improve your chances on getting everything you want. Without further adieu…
Look at Last Year’s Models
Unless you’re getting a completely redesigned model, the only difference between a 2007 and a 2008 Ford F-150 is a different color option or two and maybe different features in the cold weather package, but it’s the same car built in the same factory by the same people. The engine and electronics are just as reliable and major recalls should already be fixed if the cars haven’t been purchased yet. Dealers have to move current inventory before they can add more cars. As such, they’ll want to cut their margin on these cars to get them moving and move in new, “more desirable” cars for those looking at the newest and best. Don’t be too picky and you might just get yourself a super deal.
Look for Incentives
Cash back and similar incentives are mostly gimicks to get you to purchase a new car. However, they are worth a look. Different dealers can offer different incentives for the same car. So, if you have a steady income to buy a new car but don’t have a large savings for a down payment, you might want to look for 0 money down incentives where as those who have been planning the purchase for a while might get money back off the total of the car. Some dealers like Chrysler and Suzuki had incentives dealing with gas locked in at a low price for the first year of car ownership, but with gas prices in rapid decline, these sorts of incentives are less impressive today.
Look at Used Cars
Just because you’ve always had new cars doesn’t mean you always have to have a new car. A car that’s 3-4 years old with low mileage will carry 90% of the reliability of a new car with with a majority of depreciation already worked into the price. Whereas some cars, like the Mini Cooper, see very little depreciation after a few years time, high volume models like the Civic, Corolla and
Look at Certified Pre-Owned Cars
Whereas a used car will take a deep discount due to the lack of warranty after a few years, the Certified Pre-Owned car (or CPO) is a middle ground that carries a slightly higher cost due to dealer going over the car upon trade in and ensuring everything is in factory condition (mechanically), even if the leather might have one or two wear marks or the paint isn’t factory fresh. These cars often offer a warranty
Shop Around
With the number of dealers shutting down (and will shut down in the coming months), you may have to look to dealers not in your immediate area for deals. It may be harder to leverage dealers against each other because of the distance you’ll have to travel. However, because of the prevalence of shipping cars to your local dealer, don’t be afraid to look around the country for great deals on cars. Maybe a particularly slow market has an over stock of mini-vans. Leverage this in your buying decisions and keep your eyes peeled in markets other than your own. It pays to be a smart shopper and go outside your local dealers.
Don’t Settle For Less Than You Want
This is a buyers market. Between dealers who are overstocked and independent owners who are strapped for cash, if you have cash, you’re in the cat-bird seat. You worked hard and now have the money to buy the car you want. Don’t let someone get away with trying to rip you off because they are in a hurry to sell the car. You owe it to yourself to get the best deal possible. That doesn’t mean you can be a “tire kicker,” but it does mean you have the luxury of time. Spend that time well!
Don’t Be Pressured to Buy
Dealers need you more than you need them. Dealers are starting to wise up to the average buyer and high pressure situations don’t work as they once might have. You are the one who is gracing them with your presence. There are plenty of dealers out there (for now) and you can just as easily drive to another one (or another make all together). They should treat you with the utmost respect for you are one of the few people out there still looking to buy a new car!
Don’t Buy More Than You Can Afford
Options on cars these days can be an endless wish list of all the things you’ve ever wanted or could possibly seem useful. Look at Mini Coopers, for example. The base price may start out at a mere $21,000. However, adding convenience package, technology packages, cold-weather packages and the rest of the seemingly endless supply of dealer add-ons can put your car well over $40,000 (I have a friend who virtually built one of these cars back when the Mini first came out). Determine your needs ahead of time, use the online car builder and read reviews about various features. Maybe you save a few dollars by not putting that DVD navigation system in and just buy a nice portable unit to use in multiple cars. A few items like that can set you back $2500 or more, depending upon your manufacturer.
Wait
There is the possibliity things will get worse before they get better. Millionairs became millionaires by saving their cash and waiting for the right time to invest. The same goes for car buying. Keep your cash in reserves until YOU are ready. Emotion can play a huge part in car purchasing as well as ownership. Don’t let greed or impulse drive your decision for that shiny new car that’ll make all your friends jeolous. Bide your time, look for your deals and wait. The car will come to you and when it does, you’ll be glad!
