Choosing between new and used models is one of the first major car-buying decisions you have to make. Beyond that, getting a great deal on a vehicle often involves preparation and research in advance. Look into insurance and financing early and time your purchase well to get the best deal possible.
Car buyers have different preferences when comparing the advantages of new vs. used vehicles. If you want to know that the vehicle is in perfect driving condition from the outset, a new car purchase makes sense. You also get the best manufacturer's warranty with a new car, according to Bankrate. New cars depreciate as soon as you leave the lot, however, and used cars typically give you the best mix of features and benefits for your money. If you don't have a burning need for a new vehicle and want the best bang for the buck, you're usually better off buying a used car.
Planning your budget before shopping for cars helps you make a sound choice. The general rule of thumb is to allocate 20 percent or less of your monthly income toward car payments. Knowing how much you want to spend and how much you can afford each month also sets you up for effective negotiations. Go to the dealership with a set target price. Make an offer slightly below your target and negotiate until you reach it. An alternative strategy is to offer one price as a "take or leave it" offer. When a car seller sees that you will walk away unless you get the price you want, he will work harder to meet your price target rather than risk losing a customer.
The timing of your car purchase affects your value and negotiation ability. The end of a car model cycle and the end of the year are the optimum times to buy, according to an October 2014 Edmunds.com article. These are times during which sales managers are looking to move inventory to achieve bonuses and to clear space for new models. The end of the month and the end of a quarter are also good times to buy for the same reasons.
Planning your insurance and financing before shopping helps you get the best value out of both. The price of a vehicle, your level of coverage and the safety features on the car affect insurance rates. After identifying a few models, contact your insurance agent to run quotes. Full coverage on a brand new sports car with limited safety features can be expensive, while coverage on a used family sedan with numerous safety features is much cheaper. Comparing financing options in advance also puts you in a better bargaining position at the dealership. Dealers do offer financing, but you don't hear options until after you agree to a sale price. If you set up financing before buying the car, you are better able to negotiate favorable loan terms with the dealer. Also, carefully review your contract before signing. Watch for any add-on fees, such as fabric protection and delivery charges.
