One of the most exciting times in a driver's life is when it's time for a new car. The decision of new car or new-to-you car is a personal one, but if the time is right for a fresh-off-the-lot ride, it's easy to get excited and make mistakes that cost you in the long run. Fortunately, with just a little bit of planning and foresight, anyone can buy a new car at a great rate and be happy with the decision for years to come. Here are 5 mistakes new car buyers make that you should avoid at all costs:
Mistake #1 – Making a decision too quickly
It can be easy to get caught up in the heat of the moment and pull the trigger on a new car when you’re feeling excited about a deal, but that can be a major mistake. Salespeople are trained to make a deal seem like it’s a once in a lifetime opportunity, when in reality there are deals on new car models every day. You should never feel rushed into making a decision, and at the very least sleep on it and let the emotion cool down before you make a final decision. The best way to avoid this is to research cars online before stepping foot in a dealership. If you go in knowing what you want (or at least have it narrowed down) you'll be in a much better bargaining position.
Mistake #2 – Not paying enough down
Not paying enough down on a new vehicle is another common mistake new car buyers make. This can end up costing you thousands of dollars in interest even if you happen to get a low rate. Many new car buyers complain that their loans take too long to pay off, which is often the result of not putting enough down. To avoid this, you should postpone your new car purchase until you can put down at least 20 percent. Trade-in or sell your current vehicle to get as much money as you can for your down payment if that is an option. If you know your current car is on its last legs (or wheels, as it were), start saving for the down payment now.
Mistake #3 – Negotiating everything at once
Some people make the major mistake of negotiating the value of their trade-in, the price for their new car, and their financing all at once to save time. This can be a huge mistake because a clever salesperson will take advantage of your desire to get the deal finished and can sneak a bad deal into your financing, trade-in value or vehicle purchase price. Don’t be tricked to negotiate everything at once; only focus on one deal at a time and make sure that it is favorable to you. Most banks will provide a loan for a new car, so you should stop by your local branch to see what kind of rate you can get there - it may be better than the dealership and you can use it as a bargaining chip.
Mistake #4 – Skipping the test drive
Skipping the test drive before buying a new car is always a mistake. Even if know exactly what car you want you should always test drive it and get familiar with how it actually feels to drive, its features, and its real life performance. Also, test drive a few different models that interest you before making a final decision on one. If you can, find a used model from a few years back and test drive it so you can see what it might feel like after thousands of miles. You’re going to be stuck with the car for a while, and you don’t want to find out that there is a feature that you don’t like or wish that you had after you close the deal.
Mistake #5 – Not shopping at multiple dealers
Even though there isn’t a ton of leeway on most new car prices, you can very likely find a better deal if you get two or more dealerships to compete against each other. Every dollar you save upfront matters so shop around at your local dealerships, and don’t assume that you have the best deal if you’ve only visited one. You can very likely save money when you do this, and when you get dealerships competing against each other you are the one who stands to benefit the most.
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Image: Flickr