8 Tips for First-Time Car Buyers

Buying your first car is exciting - but it can also be overwhelming and stressful given all the uncertainty that comes from this being your first car purchase. If you take the time to do a little research before visiting the dealerships, your first car-buying experience can be a less stressful and a lot more fun! Being well prepared as a first-time buyer won't be easy, but it will help you buy the right car at the right price. We've come up with some tips to help you with the process.

1. Establish a Realistic Budget. Budgeting for your first car comes down to one basic question. What can you afford in car payments each month? Look at your cost of living - mortgage or rent payments, food, insurance, social activities, and investments. Once those are calculated, the remainder could be spent on a car payment, fuel, car insurance and car maintenance.
2. Get Pre-approved for Financing. Before you fall in love with a car you may not be able to afford, go to your local credit union. Their lenders can get you pre-approved for financing at a great rate that fits your budget. You'll also know exactly how much you can spend, which will give you added negotiating power at the dealership.
3. Research. Informed shoppers are smart shoppers, so gather some information before you start shopping. Resources like Consumer Reports, Edmunds, and Kelley Blue Book offer vehicle reviews and pricing information that can help you determine what is a fair price for the car you want. The more you know about a car before negotiating with the seller, the better your position will be.
4. Test Drive the Car. Nothing is more important in your decision process than how you feel behind the wheel. Take at least half an hour to test drive the car you are considering. Try stop-and-go, freeway merging and freeway speeds. And depending on how old your house is, you may even need to test if the vehicle will fit in your garage! If the sales person does not have time to take you on a test drive, then find a dealership that will.
5. Bring a Partner to the Dealership. It's always best to work with a partner. He or she may think of questions you haven’t considered, especially if he or she has been through the car-buying process before. A partner, whether it is a friend, spouse, or parent, can help you decide which car to buy, what is a good price, and even when it is time to walk away.
6. Negotiate the Price. Price negotiation is probably the most overwhelming part of the car-buying process, but it is important for you to stick to your strategy and not get intimidated by the salesperson or even the fact that you have never done this before! If you've done your research, you'll have a good idea whether or not the dealer's offer is fair. Keep in mind that the dealer's first price is rarely their best price, so don't be afraid to reject the initial offer. If the dealer can't meet your target price, walk away. There are other dealership, other cars, and plenty of other opportunities. You will find the right car, and time and place to purchase it. Buying a car is a huge purchase that impacts your finances and your lifestyle, so the transaction has to be right for you.
7. Buyer Beware. Before signing the final contract, ask the dealer to explain each item. Dealers have been known to include extra charges for items such as fabric protection, paint sealant or rust proofing that may not be necessary. If there are charges you're not comfortable with, don't be afraid to point them out. First-time buyers should also be wary of financing deals that sound too good to be true. Offers like "0% dealer financing" may sound good, but as a first-time buyer you may not qualify for these attractive specials.
8. Most Importantly, Enjoy the Process. We know these tips can make buying a car seem daunting, but with low financing rates and hundreds of cars and trucks to choose from, your options are amazing (especially in the first-time buyer category). So, take your time as you search and ultimately negotiate for a car, and you'll be astounded with the outcome.

With a little advanced planning, a solid negotiating strategy and appropriate financing, buying your first car can be a fun and a stress-free experience!