Recently I bought a new car. This was my third car so buying them is nothing new for me.
However this time the experience was different. I made many mistakes when I bought my previous two cars.
Every time I bought a car I tried my best to learn everything so I do not make mistakes when I buy my next car.
Having gone through all the procedures while buying my three cars I decided to jot down all my experience in an article.
And that is why I am writing this article.
Here I present you with 10 easy steps that you need to follow before you buy a new car.
Step 1: How Much You Can Afford: A Tentative Budget
Before you even think of getting a car you need to agree on the budget. How much are you willing to spend?
It will depend upon your financial status and how big you want your car to be. You need to consider self finance and the loan amount.
You will need a calculator so you can factor in all the variables that might go into buying a new car.
Variables like showroom price, road price, considering tax, insurance etc.
Check out the Invoice Price from the dealer you will be buying your car. Then MSRP price which is manufacturer suggested retail price or sticker price.
Factor in everything and make a final decision how much you can afford.
Step 2: Start Doing the Research Online and Offline Both
Now you got to do some research. You can talk to the people who already own the car that you are about to buy.
Ask them about the performance, everything that is good and bad about the car, note down everything that they have to say.
Later you can take your research online. Online is great way to know everything about the new car.
You can compare your car using side by side comparison tools. Try out every model of every other company and then reach to final conclusion.
You get finest details from dashboard to the boot space of every car.
There are many good car sites on the internet that can help you in your online research.
Step 3: Figuring the Physique of the Car
Next two steps would be figuring out the physique and features you may like to see in your new car.
Here we will talk about the things that you need to consider about the outer looks of the car.
What kind of car would you like to buy? A sedan or a SUV or a MUV or just a hatchback?
This will depend upon your need and the family. A sedan is perfect if you are a family of 4 but SUV is good if you have 7 to 8 members.
You might also like to buy just a compact hatchback car. So it depends upon your need.
What color would you like to have blue, red, maroon, snow white etc. Then model or what variant would you like to buy?
Finally petrol or diesel? Petrol version is cheaper than the diesel one. Expert says if you don’t drive minimum 80 KMs daily then Petrol car is a good option.
So figure out all these things.
Step 4: Jotting Down All the Possible Features You Want to Have
Figure out all the features that you may want in your new car. Here you might also like to revise your initial budget because more features mean more money.
The first thing is AT (Automatic Transmission) or MT (Manual Transmission), the later one is cheaper than the former.
What about the brakes? Safety features like airbags!
Similarly about the interiors, normal seats or leather ones. You decide!
Warning: Do not go for extras like headlights GPS etc because they charge you double! Better you buy it from a local car accessories shop.
If you are going for petrol version over diesel then it gives you more mileage and the price of the car is also less but cost of petrol is higher.
However with diesel cost of the car is very high & maintenance is more than a petrol car.
Step 5: Coming Down to the Business, I Mean Financing Your New Car
Once you are through with all the steps mentioned above you better get down to figuring how you are going to finance your new car.
You want to lease out the car or buy it.
Usually people would like to lease out a new car. It does not matter how expensive the car is they lease out and pay monthly in instalments.
It is always difficult to buy a new car outright but leasing a car has many problems.
For example you will require higher insurance coverage, monthly payment is taxable, purchase price is also taxable and you can’t modify the vehicle.
So these are problems with leasing so buying is the best one if you can afford.
Or else pay down payment and agree on an EMI.
Your vehicle must be insured.
Warning: Do not go for extended warranties because you will be throwing your money. Do not do it!
Step 6: What to do With Your Old Car?
What if you already have a car? Whether you want to sell it or trade in for the new one?
Well both have advantages and disadvantages.
If you are selling it on your own then you have to look for a buyer and that could take some time. You may try sites like CraigsList, OLX, Quikr.
Every time there is an enquiry, you have to tell all the history of your old car, let the buyer go for a test drive & then process of negotiation. If you can afford this then you can get high value of your old car.
But if you are trading in then the process is very quick & dealer will do all the formalities of transferring your old car to new owner.
However while in exchange you lose money because you don’t get the return that you might get while you are selling the car.
I leave it up to you whichever suits you the best.
Step 7: When and From Where to Buy the Car?
Seventh step is very important. When and from where do you buy your car?
There is a right time for buying your new car. You need to look the market when they are offering rebates and special financing offers.
End of the month is perfect timing for buying. Timing should be perfect. You can always refer newspapers for discounts & offers for your selected cars.
Now from where would you like to buy your new car?
Usually there are three buying options direct buying, buying from the dealer referral sites and from the manufacturer’s site.
Direct Buying – You buy from a car website where they deal everything up to delivering the car to your doorstep.
From the Dealer – You can go to the dealers showroom or their website and buy your car from there. There are good chances of negotiation from the showroom.
Manufacturer’s Site – Although you can’t buy directly from the manufacturer but they will give you a list dealers in your city.
Step 8: A Thorough Test Drive of Your Car
Never forget to test drive your new car. Look for everything that the manufacturer promised to you.
Check the mileage, riding comfort, interiors, power of the engine, acceleration, shock absorbers, brakes etc.
How is the transmission because if you are going for AT then it is very important to check on this.
If you like then take your friend with you who may have more experience than you.
Step 9: Hard Negotiations With the Dealer and Final the Deal
You are almost done now and here you are about to seal the deal. But before sealing the deal you have to negotiate very hard with your dealer to bring the price down.
First get the multiple price quotes from all the dealers in your city. Show him and negotiate a price on a worksheet.
Tell him how other dealers are ready to sell the same car for lower price. And don’t afraid to walk out if you feel price is too high.
Never except extras (like headlights, GPS etc) that a dealer may like to push on you.
Ready the buyer’s order thoroughly and sign the deal.
Step 10: Break into Your New Car and Experiment
Although this is a formality to tell you but break into your new car and drive first 1000 miles. See if there is any problem if you find one then report to owners.
Follow the manual.
So these were 10 steps you need to follow before you buy a new car.