Nothing is quite like climbing behind the wheel of a new car for the first time after you’ve signed on the dotted line and get to drive it home — even if it isn’t a brand-new, fresh-off-the-lot vehicle. If it’s new to you, it’s a new car, and there are a few things you need to do to prepare before you finally bring your new baby home.
Know Your Price
You probably know what your budget is for buying a new car, but do you know what the price should be? If you’re buying a new car off the lot, ignore the MSRP and look up the invoice price for your vehicle. This is the price the dealer ends up paying the manufacturer for the car — and even that price might be higher than what they actually pay due to discounts that don’t appear on the invoice.
The MSRP is marked up from the dealer price to allow the dealerships to make a profit. If you’re going to negotiate, start with the invoice price.
If you’re buying a used car, memorize the Kelley Bluebook values for your chosen car — including the costs if it isn’t in perfect condition — so you have something to negotiate with.
If Financing, Check Your Credit
Unless you’re buying your car outright, which for many people is impossible, you’re going to need a loan. The loan terms will be based on the cost of the car, your income and your creditworthiness — basically, your credit score and history.
Don’t go in flat-footed — check your credit first. You can download a free credit report every year from the three major credit reporting agencies, and sites like Credit Karma let you check your report for free throughout the year, too.
Clean Out Your Garage
You don’t want to bring home a new car and have nowhere to park it. Before you even think about heading out to the dealership, take some time to clean, organize and declutter your garage. Sort through everything to figure out what you want to keep and what you don’t need anymore. This is the perfect excuse to have a yard sale, too — why not add some extra money to your new car fund?
For the stuff you’re keeping, invest in out-of-the-way storage options that allow you to store a lot in very little space. Wall storage solutions and even storage options that bolt to the ceiling are all great options.
Time It Well
Dealerships run on a month-to-month basis. If you wait until the end of the month to purchase your new car, you may be able to get a lower price because the salesmen are trying to meet their monthly sales goals. If you can wait a little longer, hang out until the end of the model year — dealerships will want to clear out the last of the previous year’s models as quickly as possible to make space for the new year’s models, so there will likely be plenty of bargains on the floor.
When you’re finally ready to head to the dealership, don’t just walk in. Sure, you can take advantage of all the free coffee and stale bagels while you wait for a sales associate to help you, but it makes you look like you’re not serious about your purchase. Instead, call and make an appointment with a sales manager. It seems more professional and tells the dealership you mean business.
Know Your Trade-In Value
Trading in your current car can be a smart way to knock a few thousand dollars off the cost of your new car, especially if it’s in excellent condition. You know what that means — it’s time to break out the Kelley Blue Book again. Know the value of your trade-in before you visit the dealership.
Car dealerships will probably try to lowball you on your trade-in value or raise the price of the new car, so you’re not actually saving any money — don’t let them bully you. If they try to low-ball you, you can just walk out. If they don’t accept the value of your trade-in, you can always sell it privately after you purchase your new car, likely for its full value.
Know Your Rights
Take some time to learn the lemon law in your state, as well as other laws that protect car buyers. If you’re purchasing a new car, read all the fine print in the warranty and return policy — yes, new cars have a return policy — so you understand both your responsibilities as the car owner, as well as the dealership’s responsibilities to you. You don’t necessarily need a lawyer, but make sure you read all the fine print to ensure you’re not signing away any essential rights.
Don’t let these tips discourage you from buying a new car. It’s a fantastic experience, whether you’re getting a new car every year or every decade. Just don’t buy one on a whim — it’s crucial to take some time to prepare and do plenty of research before you sign on that dotted line.