The first time you have the chance to go out and purchase your own new car is always super exciting. However, if you want the experience to be positive, you will first have to have a few things in order.
It takes money to purchase a new car, and you likely don’t have a lump sum of cash sitting around the house. You’ll need to understand the financial ins and outs of the process before you can drive a new vehicle off the lot.
Take a moment now to read through this brief look at a few finance tips for first-time car buyers, and go forth with the knowledge to get the best deal possible.
Research research research
One of the most useful things you can do to get the best deal on your first car purchase is research. The more research time you put into each step of the process, the better off you will be when you drive off the lot.
Research what you really need from your new car. Take the time to compare low-interest car loan options. Research safety ratings on the vehicles available. Research ways to get the best pricing on your new vehicle, and learn how to properly haggle with salespeople.
Get your credit in order
Your credit score makes a huge impact on the financial setup you’re able to get when you purchase a car. If you go into the process with a clean credit history and a good credit score, then you’ll have more options from which to choose your new ride.
Use Credit Karma or Credit Sesame to get a closer look at your financial history. Once you have the layout, work to improve where you can. There may be small debts you can pay off easily to boost your overall credit score.
Know what you can really afford
Adding a car payment to the budget is a significant change in your financial setup. It’s wise to make sure you don’t overextend your bank account.
Your vehicle will cost you more than just a simple monthly payment. Keeping a car on the road takes insurance, regular oil changes, and a lot more. Make sure to budget for the full expense of car ownership.
Get pre-approved for financing
It will make the process of purchasing a car much easier if you work to get financial approval from a lender beforehand. Just as you would do to purchase a home, you should do the footwork to acquire a loan pre-approval letter. Then, you’ll have a clear estimate of how much money you have to work with when you go to choose your new car.
Purchase a vehicle you can afford to maintain
If you can barely pay your car payment, then you don’t have enough money to own the vehicle. You should always be in a financial position to take care of any emergencies that may arise with your new vehicle on top of the regular payments and maintenance.