When you start to scour the Internet for ballpark prices on a new or used car, or even stop by a dealership on your lunch break to peruse local offerings, it’s a good idea to compare MSRP, and look at available features packages, but don’t leave out a few other critical steps to get the best price on your car purchase.
For anyone who doesn’t have a massive cashier’s check to hand a dealer, financing is a “necessary evil” for buying either a brand new car or a decent pre-owned model. But the way that you finance can have immense effects on your final pricing.
The AWARE group or Americans Well-Informed on Automotive Retailing Economics is encouraging consumers to approach car financing with a critical eye. In a recent appeal to today’s drivers, AWARE spokesman Eric Hoffman details some of the reasons that arranging the right car financing deal is so important for an affordable buy. Hoffman likens car financing to vehicle maintenance; while the two may not seem similar from the outset, some similarities do apply. Like maintenance, which happens after you buy the vehicle and drive it for awhile, car financing is a complicated, multi-step process.
AWARE points out that many drivers are thinking about fuel costs, but not as many are considering the “total costs of ownership,” an idea that goes far beyond what you pay at the pump. Items like insurance and even parking add to monthly costs for a vehicle, as do property and sales taxes, registration, and other paperwork costs.
So what can drivers do to get their car financing costs down? Some of the steps that AWARE recommends are ones that we have been suggesting for quite a while. One of the best ways to lower financing cost is to bring a bigger down payment. This cuts down on how much you borrow and how much you pay for it over time. Also, drivers can take advantage of recent price spikes in used cars by demanding the right price for their trade-ins. Shopping around to third party lenders can also do wonders for your bottom line in a new or used car deal. For more on handling all of your auto costs, visit www.autofinancing101.org and look at some of the other elements of what it takes to afford your ride.