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August 20, 2015

How to Survive Your First Car Buying Experience

If you’ve never purchased a car before, you may be a bit nervous. After all, you’ve undoubtedly heard the horror stories of pushy salespeople virtually grabbing your hand, shoving a pen into it and holding your wrist as you sign a contract to buy a car you simply can’t afford.

Rest assured this doesn’t really happen. But you could find yourself in over your head if you’ve never purchased a car before.

So take a look below for some tips on how to survive your first foray into the world of auto sales.

First-time car buyer

Your first car-buying experience can be a winner if you follow the steps below.

  • Perhaps the most important thing you should do – and you should do it first – is to settle on how much money you’re willing to pay for a car. We’re not talking about your monthly payment, but the total amount of the car you’re going to purchase. (This includes taxes and fees.) Promise yourself – swear to yourself – that you will not go over this amount. No. Matter. What.
  • Sticking to a total amount is wisest because a sales person no doubt will ask you what you want your monthly payment to be. Tell him you can discuss monthly payments (if you’ll be taking out a car loan) later. Don’t discuss monthly payments at all – you can end up buying a more expensive car that way.
  • If you need a car loan, get pre-approved for a car loan before heading out the door to look at cars. This also will save you money in the long run because you will know exactly how much car you can afford. If a car costs $20,000 and you’re only approved for a loan of $16,500, you’ll know exactly which cars to look at: cars selling for less than $16,500. Yu won’t even be tempted by the $20K cars because you won’t look at them.
  • As you shop for a car loan, aim to get one that will see you paying the loan off in no more than 48 months (four years). Any loan longer than that means you’ll end up paying a lot more than the sticker price for the car over the life of the loan, due to interest on the loan. (You still will pay a more for the car in total with a four-year loan, but it won’t be nearly as much as with a five- or six-year loan).
  • Try hard – really hard – to have enough cash on hand to pay at least 20 percent down on the car. This helps ensure you won’t ever owe more on the car than it is worth.
  • If buying a used car, make sure you’ve studied Consumer Reports or Edmunds.com to find which used cars have good ratings for value, reliability, etc.
  • When you enter the dealer’s lot, stand firm with your budget. Never be afraid to walk away from a car if you and the salesperson can’t come to an agreement as to price, etc. There will be a great car – new or used – that fits your budget and you will find it.

We sell used cars here at our PAACO locations, and so we naturally have car salespeople. But we really don’t look at them as salespeople—we consider them to be car financing experts who can also sell you a car.

So if you need help financing a used car, we can help. Contact us in the Dallas area at  877-810-4555 for more information on our used car sales and financing services.

Image courtesy Stuart Miless/FreeDigitalPhotos.net

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