Purchasing a Car

Purchasing a new or used car is an important decision and, for most people, a major purchase. After financing has been arranged for a new or used car purchase, consumers can begin shopping. Utilizing a combination of research tools, consumers should narrow down their vehicle choices to several models or available vehicles. Once a final choice has been made, the consumer will begin the purchasing process either at a dealership or through an independent seller. The purchase process involves several steps including initial inspection, test drive, negotiation, and, finally, signing a contract and other necessary paperwork. After the purchase process, a vehicle owner must begin considering procedures such as purchasing car insurance and protection for the vehicle.

Background

Many car-buying choices depend on the type of financing that a consumer arranges before the purchase. For instance, the choice of a new or preowned vehicle, the model and year, and other options may depend on the type of financing that a potential car buyer can arrange beforehand. The process of financing a vehicle purchase can involve budgeting, saving for a down payment, and obtaining an auto loan to afford the purchase.

After financing is arranged, the consumer can begin choosing a car. Consumer advocacy and research groups like Consumer Reports magazine recommend researching vehicles online first and taking time to compare features such as safety ratings, owner ratings, reliability, maintenance costs, fuel efficiency, and trade-in value. One of the most common mistakes that consumers make when searching for a car is to become fixated on a specific model and neglect to research other options. Experts recommend beginning research from the perspective of knowing what one hopes to get out of car ownership, rather than looking for a specific type of vehicle.

Safety and reliability should be prime considerations when considering either a new or used car. Federal crash test ratings are available through the government site Safercar.gov and can be helpful in determining the relative safety of various models and whether the model has ever been recalled for safety issues. In addition, websites exist that provide the accident history of a used vehicle. The vehicle’s vehicle identification number (VIN) is used to obtain history reports and any documented difficulties.

Another thing to consider before the purchase is the possibility of offsetting the purchase price by trading in another vehicle. Even in cases where a vehicle is not fully paid off, it is still sometimes possible to trade it in and have the dealer pay off the residual on the original vehicle as part of the purchase agreement for a new vehicle. Buyers should, therefore, take the time to carefully research the trade-in value of their current vehicle before beginning a purchase negotiation. Buyers should consider the trade as part of the negotiation and as a separate transaction. Buyers can, therefore, visit a dealership to determine the value they can get from a trade before committing to the purchase process.

Overview

A first visit to a dealership should be focused on inspecting and test-driving one or more vehicles from the buyer’s selected list of potential purchases. Before making a trip to the dealership, the customer should take adequate time to learn about the models he or she is considering, including features, options, and pricing.

After locating a potential vehicle, the customer should perform a detailed visual inspection, both of the exterior and interior of the vehicle. The Kelley Blue Book website encourages potential buyers to pay attention to how the pieces of the vehicle fit together. Large or uneven gaps may indicate poor quality, and buyers should be looking for even, smooth construction without defects or irregularities.

The car-buying guide on the Consumer Reports website warns that many customers overlook the comfort and fit of a vehicle in favor of a certain "look" or "image." During the inspection, the buyer should take note of how easily he or she can get into and out of the vehicle and how well the seats, headrests, seatbelts, and other features fit and can be adjusted. The buyer should also sit in the driver’s seat, passenger seat, and the back of the car, and in all these locations test the reach and location of compartments, seatbelts, and other features. Before beginning a test drive, it is also advisable to turn on the audio system and any navigation, internal computing systems, or global positioning systems (GPS) and test these features as well.

When purchasing a used car, the buyer can also use the inspection to check for signs of body repair. The buyer should also look closely at the tires of a used vehicle. If the pattern of wear on the tires is uneven, this may indicate problems with the vehicle’s alignment. The condition of the footpads on the accelerator, brake, and clutch (when present) can also indicate how much use the vehicle has received.

With used vehicles, especially when purchasing through a private owner, the buyer can often negotiate taking the vehicle to a private mechanic for a technical inspection before making the purchase. This option is typically not available for purchasing new cars, but the buyer can often learn about common problems and customer complaints using web-based research services. The Consumer Reports guide to purchasing a used car recommends that the buyer insist on taking the vehicle to a mechanic that can conduct a diagnostic analysis of the vehicle’s operating systems. Buyers who have a previous relationship with a mechanic should ask to take the vehicle to their auto shop or mechanic for inspection. Buyers who do not already know a reliable mechanic might spend time researching mechanics before beginning the purchasing process.

The test drive is the most important step in choosing the right vehicle. First, the buyer should take a moment to listen to the sound of the engine. In used cars, uneven throttle, ticking, tapping, or clicking sounds while the vehicle is idling can indicate deeper engine problems.

The buyer should then pay attention to comfort and ease of control during the test drive. The vehicle’s acceleration should be tested while taking note of how loud the car is while in operation. The buyer should pay attention to steering, responsiveness in braking, and the function of the vehicle’s electronics, including turn signals, hazard signal, brake lights, headlights and fog lights, air conditioning and heating, and any other features. Each of these features should be operable while driving.

If the buyer is satisfied with the quality and comfort of the vehicle, negotiating the purchase price begins. Online research guides and websites can help verify a dealer’s cost for each vehicle and can, therefore, help with deciding how to begin a negotiation. The car buying guide from Consumer Reports warns that a common mistake in negotiating the price of a vehicle is beginning with the "sticker price" or "stated price" of the vehicle through the dealer. The price a dealer pays for a vehicle should be the starting point for price negotiations with the dealer. Experts also recommend avoiding specific promotions or deals. Instead, the buyer should ignore promotional offers and obtain a firm price based on the bottom-line price of the vehicle.

Car dealers are often trained to attempt adding on "extras" to increase the purchase price. These added features, like corrosion protection, paint sealant, and fabric protection, are common strategies to add to the purchase price. Buyers should research options before beginning the negotiation. Experts also recommend rejecting extended warranties on vehicles that have good safety and reliability ratings.

According to a 2024 article in Forbes, buyers should not be in a hurry when buying a new car and should be willing to haggle or walk away. They can also consider getting financing from a bank or a credit union that offers a better deal than the dealership. Furthermore, a dealer may make a better offer on a loan. Buyers also are more likely get a better deal on a new car when shopping during the off-season, the winter. A new car dealer probably will not give you the best deal on a trade-in, so buyers should consider selling their old car on their own.

Once a price is agreed upon, buyers should carefully review the paperwork provided by the dealer. Buyers are advised to look for instances where a dealership might add undisclosed "extras" or "options" not discussed in the initial negotiation and remove any before signing. In addition, Consumer Reports recommends not driving a vehicle home from a dealer if any additional work or alterations need to be made. Instead, the buyer should wait to finalize the deal until the vehicle is ready to be taken home and should not need to return to the dealership for any additional work.

Car buying experts advise that a buyer be willing to walk away from a deal or a negotiation if they feel that the dealership is attempting to take advantage of them. Therefore, buyers are advised to enter into negotiations prepared to seek out other options if they are unable to get an optimal price or to receive optimal service from the dealer. Buyers who enter into negotiations eager to purchase a car or who are fixated on a specific model, color, or vehicle available through a certain dealer, have a disadvantage in the negotiation process.

Bibliography

"Buying Advice." KBB. Kelley Blue Book, 2015. Web. 19 June 2015.

"Buying a Used Car." FTC. Federal Trade Commission Consumer Information. Aug 2014. Web. Jun 19 2015.

"Car-Buying Negotiating Guide." Car and Driver. Hearst, July 2009. Web. 19 June 2015.

"Do’s and Don’ts at the Dealership." Consumer Reports. Consumer Reports. Feb. 2014. Web. 19 June 2015.

"How to Negotiate a New Car Price Effectively." Consumer Reports. Consumer Reports. Feb. 2014. Web. 19 June 19 2015.

"Inspecting a Used Car." Consumer Reports. Consumer Reports. May 2014. Web. 19 June 2015.

Karimi, Sabah. "7 Things You Must Do Before Buying a Used Car." US News Money. US News and World Report. 10 Sept. 2014. Web. 19 June 2015.

Lancaster, Jason, "What Are Some Good Tactics to Use to Lower the Price of a Car While Negotiating with a Car Sales Person?" Forbes. Forbes, 26 July 2013. Web. 19 June 2015.

Max, Josh. "Five Ways to Save When Buying a New Car." Forbes, 31 May 2024, www.forbes.com/sites/joshmax/2024/05/31/five-ways-to-save-when-buying-a-new-car/. Accessed 27 Oct. 2024.