Sales Tips

Car Buying

Buying a car easily ranks as the most enjoyable shopping experience for many people. Men tend to look for powerful engines, exterior styling, and mechanical features, while women tend to focus more on the safety, comfort, and color aspects of an automobile. But whatever your preference, today's auto manufacturers offer makes and models designed for every segment of the car buying market. And they strive to maintain market share by offering an array of pricing and financing incentives.

Buying a New Car

When buying a new car, research the specifications and consumer ratings for different makes and models. You may find it worthwhile subscribing to Consumer Reports and checking out their overall ratings and reliability predictions. Next, consider leasing rather than buying if you expect to keep your vehicle in good shape and plan to trade it in after two or three years. Third, determine the approximate price with the options you want and investigate financing alternatives. Fourth, find the make and model you are considering and take some test drives. Fifth, negotiate the price of the new car deal and, separately, the price of your trade-in vehicle (if any). You may be able to get a better price for your trade by selling it privately, but many people prefer the convenience of simply selling to a dealer.

Buying a Used Car

A new car depreciates steeply during the first months after purchase by its original owner. Therefore, a well maintained used car may be a good value if it has low mileage and good consumer ratings. Used cars are available from private owners, used car dealers, and new car dealers. A private owner may offer the lowest price, but usually will not offer a used car warranty. A used car dealer typically offers a step up in price and after-the sale service, while a new car dealer may offer more costly manufacturer-certified used cars with extended warranties. In any case, it is important to research make and model ratings and to learn about a car's maintenance history and condition before buying it.

Service Tips

According to recent studies, 5 percent of all motor vehicle fatalities are clearly caused by automobile maintenance neglect. The following simple and inexpensive preventive checks will greatly extend the life of the vehicle, ensure safer operation and even benefit the environment.

Always consult your owner’s manual, but a good rule of thumb is to have the oil filter changed regularly, every 3,000 to 4,000 miles.
Have all fluids checked, including brake, power steering, transmission/transaxle, windshield washer solvent and antifreeze. These fluids play a large role in the safety and performance of the vehicle.
Check tire inflation. Under-inflated tires can result in a loss of fuel efficiency. This is the least expensive form of preventive and safety maintenance. Tires should be checked once a month.
Keep your engine tuned. A fouled spark plug or plugged/restricted fuel injector can reduce fuel efficiency as much as 30 percent.
Have the chassis lubricated frequently. This step extends the life of the moving components of the vehicle's suspension system.
Check battery cables and posts for corrosion and clean them as needed. The battery fluid should also be checked and filled if it is low, except in the case of maintenance-free batteries.
Have the lighting system checked frequently, including headlights, turn signals, and brake and tail lights.
Check windshield washer blades for cracks, tears and windshield contact. Replace them approximately once a year or sooner if streaking begins.
Inspect engine belts regularly. Worn belts will affect the engine performance. Look for cracks and missing sections or segments.
Have the air filtration system checked frequently. The air filter should be checked approximately every other oil change for clogging or damage. This system ensures that the vehicle is performing at its peak condition.

Always consult the vehicle owner's manual for individual service schedules as manufacturer maintenance requirements vary greatly.

Finance Tips

Chances are, if you’re planning to buy or lease a new car or truck, you’re part of the increasing majority of consumers who do their homework well in advance of taking a test drive. Many consumers research pricing information, features and options, colors, specifications, safety and quality ratings. But if you’re not paying cash for your vehicle, do you check interest rates, your credit score, and financing options with the same intensity? If not, you should.

In most cases, the dealership will work with you to explore financing options that fit your budget. But it’s always a good idea to have a solid game plan on financing and understand your options before you set foot in a dealership. A recent study by J.D. Power and Associates shows that more consumers are obtaining financing from non-dealer sources such as banks, credit unions, and online lenders. Currently, more than one in five luxury vehicle buyers secure financing without assistance from the dealer. The auto loan financing market is becoming increasingly crowded. As banks, credit unions, and independent lenders become more active in automotive financing, manufacturer-sponsored financing programs offered by dealers will face pressure to become even more competitive.

The study also finds that leasing, which gained popularity in the ’90s, is on the upswing again for the first time in five years. In 2005, 64% of all luxury vehicles were leased, up from 55% in 2004. Similarly, the lease rate for non-luxury vehicles was up 4% during the same period, from 18% to 22%. Leasing is becoming more popular, in part, due to rising interest rates. The average interest rate paid by luxury vehicle buyers increased from 3.9% in 2004 to 4.5% in 2005, and rates paid by non-luxury vehicle buyers increased from 4.2% in 2004 to 5% in 2005.

THREE KEYS TO SUCCESSFUL AUTO FINANCING

Key #1: Do Your Homework

Evaluate your financial situation and determine how much you can afford to pay. Use our Payment Calculator to determine what fits your budget.
Check out the “Build a Vehicle” feature on this site to determine a realistic price range for the model you are considering.
When doing your research, don’t let price alone be the determining factor. Even though a particular model may fit your price range, it may not meet your needs.
Understand the differences between buying and leasing.
Compare interest rates and financing terms from multiple sources such as banks, finance companies, credit unions, and the dealership.

Key #2: Stay Focused

Stay within the price range you can afford.
Base your purchase decision on the vehicle and whether it meets your needs rather than shopping for the largest rebate or other financial incentive.
Focus negotiations on the vehicle price—not monthly payment. A few extra dollars in a monthly payment can add hundreds or thousands of dollars to the total amount paid over the life of the loan.
Financing terms and conditions are always subject to approved credit.
Understand the value and cost of optional products such as extended service contracts, credit insurance, or guaranteed auto protection.
Read the contract carefully before you sign it. Ask questions about anything you don’t understand.

Key #3: Protect Your Credit

Make your payments on time. Late or missed payments may result in late fees and will appear on your credit report, which can impact your ability to get credit in the future.
If you financed the vehicle, be aware that the bank, finance company, or credit union that bought the financing contract from the dealership holds a lien on the auto title (and in most cases the actual title) until you have paid the contract in full.
If you have difficulty making your monthly payments, talk to your creditors. Work out a repayment schedule and, if necessary, seek the services of a non-profit credit counseling agency. Don’t wait until it’s too late.