4 Financial Considerations When Buying A Used Car
Shopping for a new-to-you vehicle comes with specific considerations. Once you know the type of vehicle you need, then it's time to begin thinking about financial concerns. The following are a few financial tips to keep in mind as you visit used car dealers.
1. Arrange for Financing
You will be financing the vehicle unless you have the bank balance to pay cash for the entire purchase price. Although some used car dealers provide financing options, it is always a good idea to shop around for financing on your own before making a purchase. Often times you can get better terms and interest rates by financing through an institution that you already do business with, such as your bank or credit union. Of course, you should always compare the terms you secure with those offered by the dealer-recommended banks before finalizing the deal.
2. Maximize Trade-Ins
If you are planning to trade in a vehicle towards the purchase price of the used car, make sure you have an idea of its trade-in value first. You can check trade-in value for vehicles of your make, model, mileage, and condition through a variety of sources, such as the Kelly Blue Book. Another way to get an idea of value is to find cars like yours in similar condition that are for sale in your area. The trade-in value will be less than the sale price, of course, but this way you can go into negotiations with clear knowledge of the value you are bringing to the transaction.
3. Request a History Check
There are a variety of services that will pull the VIN of the used car you are considering to produce a full accident and service history. Some used car dealers even offer access to these reports for free as one of the benefits of purchasing from them. With the aid of these reports, you will be able to see if the car has ever had any accident claims filed. Many shops also now report both repair work and maintenance work, so you can also verify that the car was well cared for by the previous owners.
4. Learn the Cost of Ownership
The cost of a used car doesn't end at purchase. It's a good idea to research the maintenance expectations of the vehicle. Some internet sleuthing on consumer reporting websites can turn up the most common repair issues and maintenance issues likely to occur to the vehicle specific to its age and mileage. You should also check with your insurance company to verify the cost of maintaining insurance on the specific vehicle to ensure it will be within your budget.
Contact a used car dealer if you are ready to find a vehicle at a price you can afford.
