7 Tips for First Time Car Buyers

Purchasing a car for the first time is exciting. Individuals typically have an idea of the type of vehicle they want, there are a variety of things to consider before individuals even begin looking for a car. The following are seven essential tips for first-time car buyers.

Credit Score

Dealerships will run a credit check on a potential buyer utilizing one of the three major credit reporting agencies. Individuals should ensure they have a good credit score, as it will determine costs ranging from interest rates to insurance expenses. Buyers should obtain a copy of their credit report and fix any inaccurate information.

Budgeting

It’s essential that individuals have a firm understanding of their finances and what they can afford to pay each month on their vehicle. It can be beneficial to schedule a meeting with a loan officer. They will be able to ascertain the maximum purchase price that an individual can afford. The process is similar to obtaining pre-approval for a home loan.

Type of Vehicle

There are dozens of vehicles from which to choose and buyers need to determine what they want and expect. Individuals may want reliable transportation with good gas mileage, a vehicle with the ability to haul things, or one most appropriate for cross-town commutes.

Research

The cost of the same vehicle can vary widely among dealerships and will depend on the options installed. Visit multiple dealerships to find the best price on the desired vehicle(s) and options.

Financing

Most financing will be obtained through a bank or credit union, but there are other options that should be explored. Some dealerships offer special financing for first-time buyers or offer internal financing. Be sure to look at the interest rates being charged since it will have an impact on the total amount being paid back. In some instances, leasing is a better option than buying. Be aware that the longer the term of the loan, the less the monthly payments will cost.

Down Payments

Unless an individual’s credit score is in the excellent range, few banks or dealerships will sell a car without a down payment and that’s often equal to 10 percent of the purchase price. A large down payment will reduce the amount that must be financed.

Consider a Used Vehicle

There are benefits to purchasing a used vehicle. The cost will be less and individuals may be able to purchase it without a down payment. The monthly installment payments will be less expensive, as will insurance costs. Be sure to have any vehicle inspected to ensure it’s mechanically sound and any recall issues have been rectified. Don’t forget to explore pricing of the same vehicle at other dealerships. It provides information with which to negotiate potential price reductions.

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The Sena Group
6501 Congress Ave., Ste. 100
Boca Raton, FL 33487