7 Tips to Consider When Buying a New Car - VFCU

7 Tips to Consider When Buying a New Car

When shopping at retail and grocery stores, we tend to have an idea or list of what we’ll be purchasing. But when planning to purchase something more expensive, like a car, for example, comes into play, a longer, thought-out plan needs to be enforced. At Valley Federal Credit Union, we’ve put together seven tips to help you when searching for a new vehicle.

VFCU has great rates to help you purchase the car of your dreams! Call or visit us today to learn how we can help you.

Form a Budget

While it’d be great to own a sports car, being able to afford one can put a damper on your efforts. A good tip to always follow is to spend no more than 25% of your monthly income on car payments. This can also include gas, insurance and anything vehicle-related.

If you’re unsure of how to do this, add your total monthly income and deduct what you’ll be using to pay other bills like groceries and rent. This will give you a good idea of how much you can afford. Even if you happen to have a small budget, a loan with a low interest rate can certainly keep your budget under control.

Certified, New, Pre-Owned or Used?

No matter the condition you’re looking for, there will always be caveat to be aware of. A new car, for example, will come straight out of the factory line, and with it, a full warranty, lower interest rate and peace of mind, but you’ll also be paying a hefty car note.

A certified pre-owned car is a popular choice but comes with a higher interest rate and shorter warranty. Used cars, on the other hand, have been making the buying process popular in recent years. They’re the least expensive and provide a variety of choices, regardless of budget.

Start Narrowing Your Top Five

Heavily research the car that has caught your eye. Visit automaker websites to see if they have the features you’re looking for and look around at other dealerships in your area. Try choosing a car that costs less than 5% of the budget you’ve put together to give yourself some wiggle room for gas, repairs, insurance and other operating costs.

Assess the Costs

After you’ve narrowed your top five choices, determine if each fits into your monthly budget by estimating ownership costs. Obtain an auto insurance quote and do a calculation of how many miles you drive annually. This will give you a good overview of how much maintenance, gas and insurance will cost you.

Secure Financing

One thing most car buyers don’t know is that dealers also sell loans. The reason they’re also in this business is because they receive commissions off of loans. While we know that car dealerships usually use flashy ads that tout low interest rates, usually only 10% of buyers qualify for 0% or low-interest deals. Visit us first to secure a good deal on an auto loan since we offer them as low as 2.3% APR!

What’s the Invoice Price?

Once you’ve done research on car sites, which includes wholesale prices for used cars and invoice prices for new ones, look at the manufacturer’s retail price. This is the amount the dealer paid for the car, and it’s best to start your negotiating there. Keep in mind that dealers need to make a profit off of the sale as well, but use the invoice or wholesale price as your starting point before discounts are applied.

Research Discounts and Test Drive

Auto dealers are always running cash-back deals, and these should be deducted after the price is negotiated. Also keep in mind that automakers also offer student and military discounts, so ask around. These discounts can be combined with cashback rewards.

VFCU Has the Loan You’re Looking For

We know car shopping can be a stressful and confusing experience, especially if you’ll have to create a strict budge in order to afford one. Being a member of our credit union in Harlingen has its perks, including getting low rates on car loans. Call or visit us today so we can help you afford the car of your dreams.

24 Responses to “7 Tips to Consider When Buying a New Car”

  1. Bernard Clyde

    I like your first tip to make a budget before buying a new car that is based off of what you make each month. It’s important that you are able to enjoy your new vehicle with less worry about paying it off. It helps to check out different dealerships to see which ones can help you find the right vehicle that fits within your comfortable budget.

  2. Zequek Estrada

    I love that suggestion to choose a car that cost less than 5% of your budget. Wiggle room for repairs, gas, and insurance are good to keep in mind. I’ll have to share this with my husband since he wants to invest in a new vehicle.

  3. Gloria Durst

    I agree that you want to consider the financing options offered when choosing a new car. It would seem smart to find a dealer that will offer fair and affordable financing for your car. My husband and I are looking for a new car for sale so we’ll have to find financing options as well to help us buy one.

  4. According to the article, I shouldn’t spend more than 25% of my monthly income on a car payment in order to comfortably afford a car. This is good to know since I have been trouble deciding how much I can actually spend on a car. I’m looking at getting into a car by the end of the summer, so this will definitely be hugely helpful.

  5. John Billows

    Me and my wife are looking at getting a new car here in the next few months. I didn’t realize a lot of car dealers offer military and student discounts like you point out. That will definitely help us to save some money on our new car.

  6. Kairi Gainsborough

    Researching discounts and test driving cars sounds like a lot of work, but it will pay off in the end when I get the perfect car for a good price. I recently graduated, so I don’t think I can still get a student discount. Maybe I can find a consultant to talk to who can tell me how I can get the best car for my money. It would be good to get the advice from someone not involved with my situation.

  7. My wife and I have been looking to buy a new car soon but aren’t sold on any models yet. I like that you recommend choosing a car that costs less than 5% of your budget so you have wiggle room for gas and repairs. We hadn’t thought about putting money aside for all these additional costs so we’ll be sure to do that. Thanks for the tips!

  8. Marcus Coons

    I had no idea that you could ask about student and military discounts when buying a car. We are thinking about getting a car for my son as he goes to college and wants to make sure it is one that will take care of him properly. As I see it, taking the time to properly assess your needs and take into account the insurance costs involved with a vehicle can help you better plan for it even if you get the car at a discount.

  9. Alexandria Martinez

    My fiance and I are thinking of buying a Ford for sale near us. We have never bought a new car before and really like the advice to take the car for a test drive. This way we know for sure that it performs how we need it to.

  10. Violette Lebrac

    I like that you talked about researching online to find your top five cars to make sure they have the features you need in a vehicle. I live in a really snowy area, and I need to get a car that can run well in the winter. It might be a good idea to research cars for sale in my area to see what my options are.

  11. Nilo Aija

    Buying a new car is a dream of every person. So some points must be to consider before choose your own car as it is a big investment of your life earning. Before choose your car check the license, certificate and warranty. Also do inspection of your car as it is pre owned or completely new. Check the invoice price. Research for a discount and go for a test drive.

  12. My wife and I have been shopping for new cars, and I think that being able to have some help would be much appreciated for us! I’m glad that you mentioned narrowing down your top 5 cars, which I think would be a great first step for us. I’m going to have to do some shopping around with my wife and figure out what cars would best fit our needs and our budget, and hopefully be able to move forward from there!

  13. Finn Stewart

    Thanks for the tips on buying a car. I agree that securing financing should be a priority when buying a car. It’s important to secure a good loan as you could have it a while. My son is about ready for his first car and I want to make sure we can find a loan that suits our needs. I’ll have to look into companies that can help us find an auto loan.

  14. Zachary Tomlinson

    Wow, it’s a great article! Now I’m looking for a car for my brother which I’ll present him for his birthday. Especially I like the part about narrowing top five cars in order make the best choice. I’ll definitely follow these recommendations viewing different showrooms and websites.

  15. Jeremy Thompson

    I love your advice to try choosing a car that costs less than 5% of the budget you’ve put together to give yourself some wiggle room for gas, repairs, insurance and other operating costs. That’s thinking way ahead. I’ll be sure to keep that in mind and to act upon it. Thanks for the great suggestions!

  16. Gloria Durst

    I like how you say that you would want to consider if you want a new car or a used one. It would make sense to consider your budget when choosing this. My sister wants to buy a car, so she’ll have to decide if she wants a new one.

  17. Earnest Watkins

    I appreciate how you pointed out that some dealers also sell car loans. This is good to know since I’ve read that comparing as many different loan options as possible is the best way to ensure you are getting a good price. I’ll definitely look into this since I’ll be needing a new car in the near future.

  18. Monica Chavez

    I like your tip to heavily research the car that you’re interested in. My brother is super interested in buying a new car so that he doesn’t have ride the bus to and from work every day. I think this tip will really help him find a good, reliable car that is just right for him. Thanks for the tips.

  19. Watson Williams

    I appreciate how you suggest I calculate monthly ownership costs when deciding what car I can afford. I’m looking into getting a new car, but I haven’t set up a budget yet. I’ll be sure to use this tip though to ensure I don’t overstretch myself financially when purchasing a car.

  20. Burt Silver

    I like what you said about forming a budget and assessing the costs. This is something I didn’t do when I bought my first car. It would really be a good idea to follow these tips the next time that I look into purchasing a car so that I don’t make the same mistakes I did last time and so I can spend wisely.

  21. Taylor Bishop

    Thanks for these tips for getting a new car. I’m glad you said you should see which car will fit into your monthly budget. It sounds like you should really research the limits of your budget to understand exactly what you can buy.

  22. Max Sayer

    Recently I have been thinking about getting a used car and I wanted to look up some information. I liked how this article talked about after narrowing down your top five choices determine if each fits into your monthly budget. I think that this is a really great tip and something that I will have to keep in mind so that I don’t spend more than I have.

  23. I recently decided that I am going to buy a new car and I have never done this before, so I am glad that I found this article because it provides some good tips. I like that you say to make a budget first and stick to it so that I make sure I buy a car that I can afford. Also, it makes sense that you should take a test drive because I want to make sure that the car will be perfect for me.

  24. I like that you mentioned budget when it comes to buying a new car because it really depends on how much you want to spend on a new car. You don’t want quality to suffer but you want to find something affordable. I’m turning 18 next year, and my parents are buying me a new car. They asked me what type of car I like. I’ll be sure to tell them about not spending too much since it’s my first car anyway.

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