You can find plenty of choice of vehicles these days whether it is sports utility vehicles, minivans, luxury sedans, land rovers, station wagons, and even light trucks. These vehicles seem to have flooded the US market like never before with a sharp increase in sales volume. There is severe competition among car dealers including car financiers and carmakers. As a result, the choice becomes even more difficult for the consumers among numerous brands and models.
Here are some tips that can probably help you in making an informed car purchase decision:
- Evaluate your options
It is essential to get all the important facts and information on the car based on the price range and the different features that are offered. It is a good idea to attend auto car shows where you get the opportunity of viewing different car models at the same time. You can have a look at the variety of cars with their different sizes and specifications. It is important that the car fits into your garage well so that you do not end up buying something that is does not fit into your space.
- Analyze the cost factors
As an owner of the car, you need to consider the costs associated with the vehicle. You need to pay regular insurance premiums for which you need to set aside a budget. And if you are planning to buy a car on a loan basis, then it is better to choose good finance options even before you consider buying a car. However, you also need to take into consideration the down payment, monthly installment and interest rates that will have a huge impact on your finances.
- Be an informed shopper
It always pays to have a sound knowledge about the vehicle that you are planning to purchase. You can have a list of options that best suits your needs and requirement with a bit of research on the current market price of the models. It helps to get a price quote of the car from different dealers. However, you can also check the resale value of the car from various car dealers to gauge the popularity of your vehicle.
- Check for car rebates
You can save cash with the car rebates that are offered on various models during a specified time period. Sometimes car dealers offer rebates to customers to popularize a new segment of car. At times, you can avail of financial schemes with zero percent finance offered by car finance companies. You should keep a close watch on the various schemes that are offered from time to time by car dealers.
- Read the contract carefully
It is very important to read the terms and conditions of the contract very carefully before signing it during the final purchase. Check if the sales figures quoted are the same as at the time of final negotiation between you and the car dealer. Otherwise, it is likely that you may end up paying more from your pocket with a little bit of carelessness.
In figures released earlier this week by uSwitch, thousands of motorists who are to buy a 57 registration vehicle from September 1st are set to waste millions of pounds by opting for uncompetitive forecourt finance deals. As a result of choosing such an option, above taking out a low-rate personal loan, Britons could be unnecessarily spending 985 pounds each in interest payments. Overall, consumers were revealed as losing out to the tune of more than 175 million pounds. Findings from the firm also showed that 2.3 million cars were sold across Britain over the course of last year, with 413,991 being bought during September and a similar figure expected to be sold next month.
A driver taking out just under 7,000 pounds to purchase a Ford Fiesta 1.4 diesel was indicated as being charged an average 12 per cent in annual interest via a showroom finance deal offered by Perrys, paying back 2,282 pounds 20p over five years. However, by choosing the same model but plumping for a cheap personal loan the financial services firm revealed consumers may only face interest set at 6.3 per cent, with 1,150 pounds the total interest payable. This in turn could save them some 1,132 pounds 20p. Meanwhile, those looking to buy a Renault Megane could be 1,027 pounds better off by financing their funding decisions wisely. Savings of 1,076 pounds were said to be available on a five-door Ford Focus if more competitive spending options were pursed by British borrowers.
Mike Naylor, personal finance expert for uSwitch, said: "Finance deals offered by car dealerships can be expensive, and unwitting motorists could end up paying as much as 1,131 pounds extra for their dream car. However, there is a simple win-win solution. Finding a competitive loan could save consumers almost 15 per cent off the price of a new car (through the savings made on interest repayments), additionally, having the money ready to buy the car will also give them more bargaining power to get the best purchase price".
"Just because a car dealer can offer you the best deal on a new car, it doesn't mean that they will offer you the best deal to finance it. The message couldn't be simpler - don't pay more for the finance on your new car than you have to." Consequently he advised those considering buying a vehicle next month to make use of a price comparison website to find the most competitive deals possible.
Earlier this year, uSwitch suggested that those 400,000 Britons who purchased a '07' registration model in March have lost out on 228 million pounds by opting for expensive finance options instead of low-rate borrowing. As a result, Nick White, director of financial services for the price comparison website, stated those who let the thought of a shiny new car sway them into choosing a showroom deal out of plain convenience could find themselves under an unmanageable "burden" of debt.
"Not only is a personal loan cheaper, by organising the loan before visiting the car showroom, people will not feel pressured to get the cash quickly to secure the car of their dreams," he claimed. Mr White also reported that opting for a finance forecourt borrowing plan could see consumers pay interest at some 4.22 per cent above the most competitively-priced personal loan deals available on the market and twice the rate set by the Bank of England's monetary policy committee.
His comments were echoed by Steven Baillie, loans manager of Sainsbury's Bank. Although statistics from the financial services provider showed that personal loans are set to make up 15.8 per cent of all car purchasing over the coming months he claimed that Britons could still be losing out on millions of pounds.
Both Mark Robinson & Abbi Rouse are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.