Car Buying Guide
Written by Remar Sutton
"Just click here and this beautiful convertible can be yours for $1 under invoice. Unbelievable! And we've got Zero Percent financing. Even more unbelievable! And we'll give you a free computer when you buy from us! And we guarantee the value of your trade-in!"
~ Guy on the TV Commercial
Listen to the hype—whether it's on TV, online, or in print—and you'd think saving money on a vehicle is as easy and fast as flipping the TV remote. Wrong! Did you know a dealer or online auto service can sell or lease you a new set of wheels for exactly what the dealer paid the manufacturer and still make $500 to $1,500 on just the car itself?
Did you know that "Zero Percent" financing may cost you more than financing at a bank or credit union—even if the bank or credit union's rate is 7 percent?
Do you hate dealing with dealers and look forward to buying or leasing a vehicle online—or from a buying service—just so you won't have to deal with the dealer yourself? Guess what: you have to deal with a dealer, even if you use a buying service! All new vehicle sales—repeat, all—have to involve a dealer.
Car Buying Websites
Do you think the Internet has made it safer for you to research and/or acquire a new vehicle? Think again! In just the past three years, the entire auto business has been ripped apart, reinvented, and re-launched. "In an instant, your privacy, your money, and your good credit can be stripped away—and that's if you're dealing with the 'good' car guys!"
Why this car buying guide is different? Because it frankly tells you the truth. I've written this special buying guide for you to give you straight answers about the car buying and leasing process.
For over 30 years, I've tracked the inner workings of the auto industry. As President and co-founder of the non-profit Consumer Task Force for Automotive Issues, and as co-founder of the Privacy Rights Now Coalition, I've pretty much seen it all when it comes to wacky sales gimmicks, deception and consumer abuse. And, it's my sworn duty to keep those things from happening to you!
And this guide will work! If you follow this guide, you can probably keep thousands of your hard-earned dollars in your pocket rather than in the dealer's.
A major promise up-front: This guide is about educating you, not trying to hype you. Confusion and deception are rampant in the auto industry and on the Web.
For instance, where is it cheapest to finance? A lot of studies show that normally credit unions offer the cheapest and most straightforward vehicle financing. Credit unions generally don't use double-talk and outright deception to try to get you to finance with them, either. But here's the rub: a bank, and at times even a car dealership, could be the cheapest for you—specifically—to finance. And dealerships in particular aren't going to tell you if their financing will cost you more.
So, how do you find the cheapest and best loan for you? We show you how to "shop" for the cheapest and best rate. Read on to learn how to do that! Thanks for reading. Your pocketbook, as they say, will thank you.
Next chapter: 1. Dealership Tactics
Car Buying Guide
Calculate Available Cash
Your Available Cash is the maximum amount you have to spend on a vehicle. This calculator enables you to determine 1) the amount of cash a vehicle loan will yield and 2) the total Available Cash from all sources, including the loan, you have to purchase the vehicle.
If the estimated amount of Available Cash is too little for the vehicle you would like to purchase, you have several options. A higher monthly payment and/or a longer loan term will typically yield higher initial Loan Cash, thus increasing your Available Cash. You may also want to consider alternative vehicles that better fit your budget.
To estimate the value of your trade, visit the Edmunds website.
This calculator is solely for informational purposes. It gives you reasonably accurate results of your Available Cash. Results for your actual loan will vary based on your final rate and loan amount.