Buying a car is one of the most expensive financial decisions you will ever make – next to buying a house. With this, it is important that you ensure that you are getting the best quality and the best deal. Before you set foot in a car dealership, you should ask yourself the following questions:
How about leasing?
Many people consider leasing because they think it is cheaper. If you take a closer look, the costs that will be accumulated over the years are more than the actual amount of buying a car. Buying a car is always a better deal. When you buy a car, you get years of service from the vehicle.
How much can you afford?
When considering cars for sale in chicago, the first thing that you need to ask yourself is how much you can afford. It is important that you first take a look at your budget then try to figure out how much money you have left after the basic needs.
You should come up with a monthly number then run it through a calculator to determine how much you can get. When thinking about a car loan, do not extend it beyond 60 months or you are running the risk of owing more than the car is worth.
Should I buy a new or used car?
Many people base this decision according to how much they can afford. There are some that do not consider new cars because a new one loses thousands in value the moment you drive it off. If you consider a used car, you should consider a two or three-year-old car. The best thing to do is to look for a highly reputable dealer who has been in the business for a long time.
What is the difference between invoice price and MSRP?
When you consider buying a new car, you should learn the difference between invoice price and MSRP (Manufacturer’s Suggested Retail Price) before walking to a dealership lot. The invoice price refers to the price that the dealer paid the manufacturer for the car. MSRP, on the other hand, includes hundreds of profit for the dealer.
If you know the invoice price beforehand, the dealer will get the message that you mean business and that you are expecting a good deal. With this, it is always better to do your own research before you walk into the dealership.
Where to get financing?
Most people need a loan to buy a car. The amount of the loan will depend on your credit history. With this, you first need to check your credit history to give you a better idea of what to expect from the lenders.
You have two options here – contract with banks through dealers or get your own financing. You must know that dealers have a contract with many banks to get the best rates but they might not actually give you those rates. If you get your own financing, there is a possibility that you get a better interest rate. You should go to credit unions or local banks and determine the interest rates.