No more public transportation. No more asking to borrow your parent’s car. You can drive to meet with friends or to the store or to school without having to wait on someone else. What’s stopping you? Probably the price tag! Yet buying your first car is easier than you think.
This may seem obvious, but it’s a step that is often skipped. Make a list of what qualities you’re looking for in a vehicle: a large trunk for hauling equipment, good gas mileage so you can drive further without constantly having to stop at the pump, maybe even your favorite color. Then as you shop around, whether it’s used cars or new cars, see how many of these qualities you can check off your list. You’re looking to get the best bang for your buck! Autotrader is a helpful resource for researching different vehicles.
As a young adult, you probably don’t have much of a credit score built yet, as it relies on regular payments being made for things like credit cards, loans, and bills. You can ask a responsible family member with good credit to help you by cosigning for an auto loan with a low interest rate, or you can save up for the full amount. This is why it’s more common for your first car to be used. New cars come with a heavy price tag, and it’s not always easy finding a cosigner.
Like we said, if you’re getting an auto loan, you want a good rate. Credit unions like SunWest often have the best rates, especially if you look for a special promotion. Another benefit to take advantage of is getting preapproved, which will allow you to know just how much you can afford. Compare different financial institutions - lower rates mean lower monthly payments.
You or your parents might have a car you’re going to sell anyway when you get a newer one. If you’re planning on buying your new car from a dealership, see how much they’ll take off the price if you trade your old one in to them. Some dealers might give you more money, making your new purchase that much better of a deal.
Your goal should be to have as low a monthly payment as possible. While purchasing a used car may mean the price is low enough to save up and pay the full amount upfront, that’s not always the case. Not to mention, there’s still your insurance to consider. Whether you buy your new car outright or with a loan, don’t forget to add in how much your insurance will be. You can compare quotes ahead of time by visiting our partners at TruStage.
It’s always a good idea to go for a drive to see if you like the feel of the car, as well as to check if there are any issues - especially with a used car. This is the fun part of the car-buying experience!
If you are purchasing a preowned vehicle, check out sites like CARFAX that will show you the car’s history, so you’ll have a better idea of what to expect.
Similar to the test drive, getting a mechanic to inspect the car beforehand can tell you a lot about how the car is doing before you commit to buying it. It might seem like more money than you want to spend, but it could save you thousands of dollars in repairs.
While Arizona lemon laws can protect you from being stuck with an unreliable new car, used vehicles are only covered in the case of a major component breaking down within 15 days (or 500 miles) of your purchase. Your warranty package and the return policy may seem boring, but reading through to make sure you understand and are satisfied with them can save you a lot of money and hassle in the future.
By this point you’ve done the research on how much the car you’re buying is truly worth, on sites like Kelley Blue Book. This will give you more confidence when negotiating the price with the dealer. Don’t forget to carefully look through the final contract before signing it! Make sure there are no unexpected fees, and you are only paying what you and the salesperson agreed on. If there’s something you don’t understand, ask. Whether used or new, buying your first car is a big purchase, and you want to feel relaxed, not rushed, as you finalize the deal.
Take your time to do your research - the more informed you are, the more confident you’ll feel. It may seem like a lot of work, but it’s worth it to make sure you aren’t taken advantage of. Having an experienced car buyer such as a parent by your side is great backup, but following these steps will help you be prepared for the future. Keep these 10 tips in mind and you’ll be driving off into the sunset in no time!
Wherever you want to go, get there on your own terms with an auto loan from SunWest Credit Union.
February 5, 2021
Published by SunWest Credit Union
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