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Posted October 4, 2011 by admin in Finance
 
 

Thinking of buying a car? Read this first!

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Whether it’s new or pre-owned, the best time to buy a car is in the fall.  As new 2012 models come into the lots, dealerships are frantically trying to get rid of 2011 models.  This creates a nifty chain reaction: as people hop into new cars, they want to get rid of their current vehicles.

If you are in the market for a car, here are a few points to consider:

USED

  • Buying a vehicle fresh off its lease: Choose a car whose lease has just ended.  Often, these vehicles make for great buys because contract guidelines enforce regular maintenance over the course of the lease agreement.
  • A three-year old car sells for about half of its original sticker price.  That’s half the taxes as well!
  • A car is never an investment. Cars depreciate in value so why pay tens of thousands more for a new car?  Better to buy used and purchase an extended warrantee if you need the extra peace of mind.
  • Arrange for your own mechanic to look at the car: Some used-car dealers and individuals may have an established relationship with a mechanic who can certify a vehicle that may not be safe.  Instead, arrange for your own mechanic to look at the car you are thinking of buying. It is worth the extra cost.
  • Purchase the CARFAX report to learn the accident and insurance claim history of the vehicle.
  • Test-drive the vehicle on a highway, winding road and bumpy road.  Any noises and/or issues will most likely present themselves in these conditions.

NEW

  • Last year’s model: the 2011 model can be identical to the 2012 model, only thousands cheaper because it’s an “older” model, yet still new.  The longer on the lot, the more value it loses.  The later in the year, the more desperate salespeople are to get rid of it, and therefore your haggling can prove very successful.
  • Use your old car as a trade:  When trading in your old vehicle you may get less than if you sold it yourself, but there is no hassle. Dealerships will take it as-is, no certification or safety required.  The best part is that the value of your trade-in decreases the cost of your new purchase, and therefore the amount you have to pay on taxes.

All in all, be sure to do your homework whether you decide to buy new or used. Read reviews and test drive the vehicle. And if it sounds too good to be true, it probably is.

MM