First time car buyers are making one of the largest purchases of their lives, and it is usually the first of multiple such purchases. Scammers know that you don’t know better yet, and that’s why they target you. Unfortunately, there are other mistakes you may make that can cost you dearly. However, some are worse than others. Here are 5 first time car buyer mistakes you should avoid at all costs.
Not Shopping Around
Not shopping around can cost you a lot of money and in several different ways. If you don’t know what the market value of the car is, you are likely to overpay. If you don’t know about the various car dealers in your area, you might end up buying a car from someone with a reputation for ripping people off. Learn more about the make and model of car you’re interested in, and check the reviews and ratings of car dealerships in your area.
A related mistake is not shopping around for financing. Don’t make the mistake of signing up for the first loan offered to you. A minor difference in interest rate adds up over time. Good dealers will offer you several financing options, and you have the right to seek an auto loan through the lender of your choice. Yet you’re likely to get a better interest rate from someone other than the dealer, too.
Thinking Only in Terms of Monthly Payments
First time car buyers often think about the car purchase only in terms of how much the car payment is each month. However, that’s not your entire transportation budget. You’ll have to pay for auto insurance and fuel at a minimum. It is surprising how many people forget about insurance, though a car loan will necessitate having full collision coverage. Tolls, taxes and other costs will come up regularly. Expect to pay for maintenance costs even if it is a new car. Total up all of the expenses you’ll have to pay each month so that you know how much you can really pay toward a car payment. On the other hand, you should consider the total cost of ownership when you buy a used car. Don’t pay a pittance for a car that’s a gas guzzler, and don’t buy a cheap car that will need expensive repairs.
Thinking in terms of monthly payments can hurt you when it comes to car financing. If the car payments come across as too high, some people stretch out the loan term to “afford” it. Unfortunately, adding another year or two to the car loan dramatically increases how much interest you pay over the life of the loan. You’d be better off negotiating down the price, saving for a larger down payment or getting a cheaper car.
Not Getting the Right Plates
A lot of people want to personalise their cars by adding some private plates to their vehicles. But know that you shouldn’t just order personalised plates online from any supplier. Too many sellers out there are out to make a quick buck and don’t understand or don’t care about what is permitted and not permitted as far as design goes.
Make sure your replacement plates are legal. Legitimate services like Number1Plates will ask you to verify your identity and ownership of license plate number. Their replacement number plates can be blank, have coloured borders, and have any legal flag on the side that you want. If you want to learn more about their products and services or build your new number plate, you can check their website at Number1Plates.com.
Not Going for a Test Drive
Around one in six car buyers doesn’t test drive the car before buying it. Another third only took a basic ten-minute test drive in the vehicle. Many of these people end up regretting the decision. You need to know how the car handles in neighbourhood streets and on the highway. Make sure you like the car’s handling before you drive. Cars aren’t shoes. You can’t easily return it and get your money back because you decide you don’t like the view out the back window. In the case of used cars, you want to take the car on an extended test drive and have it checked out by a third-party inspection centre.
Not Reading the Contract
This is a depressingly common mistake. It is easy for the salesperson to throw in a few add-ons. Don’t end up paying for extras like paint protection and an extended warranty. Don’t pay for accessories that are unnecessary or cost more than you would pay elsewhere like car wax. Verify that you aren’t being charged for things you negotiated such as giving you a third key fob for free.
Buying your first car is an exciting milestone in life. Avoid these mistakes, and you wont regret the experience.