These are just a few of the many decisions you’ll need to make before happily driving away with a vehicle. While shopping for a car or truck is exciting, it is also no simple matter. You can avoid buyer’s remorse by making important financial and practical decisions before signing on the dotted line.
Buy new, buy used, or lease?
By reviewing the pros and cons of buying and leasing, analyzing and determining your personal requirements, considering how to get the best purchase price and financing deal, and knowing the laws that protect your rights as a consumer before you shop, you can be sure to make the right choice.
What’s Right for You?
Shopping for a car can be complicated and time-consuming. It involves balancing your desires with your economic reality, deciding whether to buy or lease, and knowing what the best deal is for you. To make the process efficient and improve your chances of driving away happy, you will need to consider:
- Your Needs– Think about your transportation requirements. Does your car need to be large enough for a family of five, or small enough to fit in tight city parking spaces; tough enough to haul firewood, or chic enough to drive clients around?
- Your Wants– Your desires certainly play a part in the car buying decision. Make, color, options, and style are all important to being happy with your final choice. Read car magazines and websites for ideas.
- Your Spending Plan– It is easy to get carried away and end up with a car that is out of your price range and a monthly payment beyond your capacity. Your spending plan, not a salesperson’s opinion, should dictate your decision. Review your income and expenses to see what you have available each month for auto expenses.
Save For a Down Payment or Total Car Cost
While it is possible to buy a car with no money down, you will end up paying a lot more for it if you do so. The more you borrow, the more the car will ultimately cost.
To decrease the amount you finance, it is wise to make a significant down payment. With enough savings, you may be able to purchase a car outright (typically an option when buying a used car, rather than a new one).
Effective saving begins with first determining how much you want to save, then setting a reasonable date to achieve your goal. Using an automatic deduction can make the process easy. You can set-up a reoccurring automatic transfer to have a set sum deducted from your checking account and automatically deposited into savings.
New, Used, or Lease: Advantages and Disadvantages to Each
After you determine how much you can afford to spend, the next step is to decide between buying new, buying used, or leasing. It is important to be familiar with each option’s positive and negative aspects.
While leasing a car may enable you to get “more car” for less money each month than what you might be able to purchase, it is important to remember that leasing means renting. When the term of the lease is up, you return the car. At that point, you have the option of paying any outstanding fees for mileage or damage, or purchasing the car outright. Often, you will pay more over time by leasing and then purchasing than you would have had you simply bought the car in the first place. If, during the course of the lease contract, you choose to return the car, very high penalties will likely apply.
Arriving at a Decision
When you are ready to shop, you will want to start at PenAir. Getting the best advice, setting a plan, and having pre-approval of your auto loan all set you up to make your best deal.