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How to Buy a New Car: 9 Tips to Do It Right

Buy a New Car 9 Tips on How to Do It Right

To buy a new car is a significant achievement for many, but it can be one of the most overwhelming tasks if you don’t know what to look for. Choosing the wrong car can cost you a lot and even make you hate anything to do with cars. On the other hand, choosing the right car gives you the luxury of convenience in moving around and may save you a lot in the long run.

But thanks to the internet and the free access to information, it has become quite simple to buy a new car. In this article, we’ll offer a step-by-step guide on how to buy a new car the best deal possible.

Let’s Get Started!

      1. Set Your Budget

Before you step out to buy a new car, it’s advisable to have a budget in mind. You should determine the value of the vehicle you want and the financing option.

When setting your budget, remember to factor in additional expenses such as registration, sales tax, and insurance. 

And while cash financing seems like the best financing option, given that you won’t have any monthly auto loan repayments, be sure not to drain your savings to acquire a car on cash.

If you go for auto loan financing, it’s advisable to get preapproved for the loan before beginning your car negotiations with the dealership. Here, you can use the rbfcu auto loan calculator to determine your monthly car payments to gauge how they fit in your monthly budget. 

If you opt for car leasing, be sure to check out where you lie in the car lease credit tiers because this determines whether or not you’ll qualify for a car lease.

      1. Choose the Right Car

Once you have set your budget, the next step is to find the right car for your needs. Think of how you plan to use the car and the car model you want. For example, if you’re looking for a family car, you need to find one with ample sitting and cargo space, depending on the size of your family.

Since there are many car options to choose from, it can be time-consuming to choose your preferred car. So the best way to go about this is to create a list of the must-have features of your dream car.  Doing so narrows down your list to a few cars, making it easy to search for your preferred car.

      1. Check Reliability and Ownership Costs

Now that you have selected a few cars that meet your needs, the next thing is to ensure you settle for the best when it comes to reliability and the cost of ownership.

When selecting a car, have it in mind that some options can be cheap to acquire but may end up costing you a lot in the long run due to depreciation, insurance, repairs, maintenance costs. 

You can use the Cost of Car Ownership Over Time by Consumer Reports or What is 5-Year Cost to Own? By Kelley Blue Book (KBB) to determine the estimated cost of ownership of your selected car.

Sometimes, it’s better to spend a lot of money upfront when you buy a new car rather than spending little on the purchase price but a lot more on repairs, maintenance, insurance, and depreciation. So, this step is vital in your new car purchase decision.

      1. Test-Drive the Car

Before dishing out your finances to get that car you yearn for, do a test drive.

And while you may want to shop online for convenience, the test drive calls for your physical presence.  

While the car looks sturdy and can handle anything thrown its way, it’s good to be sure. So, talk to your dealer, set a date when they are not busy to take your desired car for a ride. 

Go for a route that offers on-road and off-road features to see how well the car handles the challenges. Take as much time as you can behind the wheel to have a first-hand driving experience with each car.

Test drives help ensure you pay for a car that you’re perfectly comfortable with.

      1. Locate Your Car

After doing the test drive, you may be lucky to find the car you have been dreaming about. But in some cases, you may be required to continue with your search as you look for your preferred car.

Typically, don’t limit yourself to a specific dealer in your search for the perfect dream car. Broaden your search until you find what you’re looking for. You can also talk to the dealer to see if they can help locate the desired car profile. Never settle for less!

      1. Find the Right Price

If you buy a car from the dealer without sufficient price information, you are likely to get overcharged. While the amount may not be huge, finding out later can be frustrating and hurt your trust with the dealer.

So, before going to the dealer, it’s advisable to have an idea of the prevailing market prices for your preferred car. And thanks to the internet, you can now find this information easily on many car websites such as Kelley Blue Book. This website gives you an idea of what other car owners in your area are paying for the same car.

Finding the right price information increases your negation powers with the dealership.

      1. Get Dealer Quotes

With the right price information at hand, it’s now time to get dealer quotes. Get quotes from as many dealers as possible, then make a comparison and settle for one with the best deal. Getting dealer quotes from multiple dealers can be time-consuming and tedious. So to save on time, you can use a third-party website like, which allows you to request quotes from different car dealers at a go.

While negotiating a deal physically seems more engaging, most dealers also process information online and will send a price quote upon inquiry via email or phone.

Compare the average market price you gathered through step 6 to each dealer’s asking price. Typically, the dealer quotes will be slightly higher than the average market price.

Be sure to get a fees breakdown from the dealers to see what the price they charge covers for. This will help you ask questions if a particular fee amount is not familiar.

      1. Maximize Trade-in Value

If you decide to trade in financed car for a lease, then you should aim to maximize the trade-in value.

While trade-in is an ideal way to reduce the upfront fee you pay on your new car, it can be a costly affair, especially if the dealership pays only a small price for your old car. 

So, to gauge how much your old car is worth, go to a pricing guide website, search for your car and compare the trade-in value (the amount you would receive) to the dealer retail (the price the dealer will sell it for). In most cases, the difference is about $3000 or more, depending on the dealership you’re working with.

Knowing the price of your car beforehand helps maximize the trade-in value because it puts you in a better position to negotiate for a fair price with the dealer.

There are other trade-in options that may help maximize the value of your vehicle, such as selling it to CarMax or any other private party.

      1. Seal the Deal

Hurray! You’re now coming to the end of your car purchase process, and it’s now time to seal the deal. 

You may seal the deal online or visit the dealership for an in-person signing of the papers. When closing the deal and you have a preapproved loan, say, rbfcu pre approval car loan, the dealership’s finance officer, may offer to negotiate the loan terms further. It’s okay to see if they can get a better rate for the auto loan, but you’ve to ensure all other terms and conditions aren’t tampered with.

Here, the dealership may decide to sell you additional services such as an extended car warranty. However, before paying for this warranty, you should first check to see how much warranty is included in the purchase price of your new car.

At this stage, don’t be in a hurry to sign the papers to close the deal and do away with it. Don’t be in a rush to take your new car home! Take your time and go through the contract. Look for additional fees such as: 

        • State sales tax: A percentage of the total cost of your vehicle which varies from state to state
        • Documentation fee: An amount charged for filling out the purchase contract
        • Registration fee: An amount the dealership charges to handle your vehicle registration process

When reading the contract, watch out for any additional fees that you might not be familiar with. Note that some dealerships include some additional fees to boost their profit. So always ask for clarification on any unclear fees and if they seem suspicious, request the dealership to remove them.

Recap: How to Buy a New Car

Here’s a quick rundown of our step-by-step guide on how to buy a new car:

      1. Set your budget
      2. Choose the right car
      3. Check reliability and ownership costs
      4. Test-drive the car
      5. Locate your car
      6. Find the right price
      7. Get dealer quotes
      8. Maximize trade-in value
      9. Seal the deal

As you can see, buying a car doesn’t have to be an overwhelming task. Typically, you don’t need to be a car expert to buy a new vehicle independently. By following the steps discussed above, you’ll be a step closer to getting the car of your dreams at the best deal possible. Good luck with your car purchase!

Featured Image: Megapixl

About the author: Shaan is a content writer who enjoys creative writing and her career in the marketing field. Shaan also has an educational background in Marketing Management.

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