Posts Tagged ‘buying a car’

Save Money When You Buy a Car

Friday, April 16th, 2010

Things to know

Your wallet won’t like it when you buy a car. Young people are always taking out loans to buy cars. I have some ideas and tips for anyone trying to avoid this.

The first thing I suggest

My first tip to everyone is that they never buy a new car. When you drive off the lot the car loses a couple thousand dollars in value. Money will be saved if you buy a car a couple years old. Buying new cars isn’t the smartest idea for someone who is just now buying their first car; it is expensive and not practical.

My second suggestion

My second tip is for you to buy an older car. You are likely to rid yourself of your first car quickly. You might count on not keeping your car very long the first time around. I know that instead of buying a car from now you should buy it from the nineties to save money. The first car you buy shouldn’t work completely since this will reduce the price significantly. You need to make sure the car is working well enough to last you through college or a few years of working.

Third Tip

My third tip is for you to pay for your car in cash. When you show up with cash rather than anything else it is going to look great and they are going to want to give you a deal. This will work with everything you buy. Many companies are going to sell you whatever you want for less if you have cash. Paying with cash will mean you need to get a receipt or contract as well. You will be protected when you can show that you bought the car.

What to do fourth

My fourth tip is that you save up for the car rather than taking out a loan for it. If you take out a loan then you should take out as little as possible. You will have two things happen to you; you will appreciate your car a lot and save money. It will cost you a lot to pay back a car loan. For your first car you should try to take out as little loan as possible.

The fifth thing to know

The car you just bought needs to be taken care of. The way you treat your car will have an impact on how long it runs. Changing the oil should be done often along with checking the engine. Make sure you avoid going on long trips. Remember to keep the car clean on the outside of it and the inside of it. All of this will help you find a car that is inexpensive and will run for a long time.

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Buying or Leasing?

Thursday, December 17th, 2009

This is one classic scenario that haunts ever car consumer out there: Pay cash upfront or settle for monthly payments? Will you be buying or leasing for a new set of wheels?

As is the case with every other common dilemma, there is no slam-dunk answer. Each option has its own benefits and drawbacks, and it all depends on a set of financial and personal considerations.

[Answers about buy or lease]

First, check your finances. It is important that you are able to afford the vehicle. Ask yourself, how stable your job is and how healthy you are financially. The short term monthly cost of leasing is definitely lower than making monthly payments on buying: you essentially pay only the portion of the car that you use up upon the time that you actually drive it.

If you have a lot of cash upfront, then you can opt to pay the down payment, sales taxes – in cash or rolled into a loan – and the interest rate determined by your loan company. Buying effectively gives you ownership of the car and that feeling of “free driving” that goes on providing transportation.

Unlike buying, it gives you the option of nothaving to fork out the down payment upfront, leaving you to pay a lower money factor that is generally

payments will result in stiff financial penalties and can ruin your credit. You need to make sure you carve out the monthly lease payment in your budget for the foreseeable future, at least for the duration of the lease.   

Other than the financial aspect, when buying or leasing a vehicle, a primary consideration is your lifestyle and preference. Think about what he vehicle would mean to you: are you sentimental about having a car or is this something to satisfy your craving for a new vehicle? 

If you want to drive a car for more than fives years, negotiate carefully and buy the car you like. If, on the other hand, you don’t like the idea of ownership and prefer to drive a new car every two to three years then you should lease.

Next, take into consideration your transportation needs: How many miles do you drive per year? How well do you drive and maintain your vehicles? If your answer becomes: “I drive 40,000 miles a year and I don’t really care much about my cars as I don’t mind dealing with repair bills,” you are better off buying a vehicle.

Leasing is based on the assumption of limited-mileage, usually no more than 12,000 to 15,000 miles a year, and wear-and-tear considerations.

Unless you can stick to the given mileage and keep the car well maintained at the end of your lease contract, you might just get hefty fines at the end of your lease agreement.

Article by: [Mike B.] , find out more about [Here] .

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Is Leasing A Car Right For You?

Tuesday, November 24th, 2009

Getting a new auto always involves calls.  Pay cash or finance?  Buy or lease your new car? 

There isn’t any wrong or right answer.  Cash upfront, financing, and leasing all have benefits and disadvantages.  As is the case with every other common dilemma, there isn’t any slam-dunk answer.  Eventually it comes down to private preference and a group of basic fiscal issues. 

First, affordability is obviously key.  How how stable is your job?  How good are your finances?  If cash flow is a concern then leasing with its short term monthly payments is a great option.  With a lease, monthly costs are noticeably lower than payments when buying.  Of course , with a lease you only pay for a fragment of the car’s cost — the part used up in the time you drive it. 

buying a car with money is a choice of course.  Or you might decide to make a huge downpayment and still lease of finance.  You might choose to pay the down the payment or sales taxes and fees.  Otherwise all of these extras are rolled into the loan. 

With any kind of financing the interest rate is set by the bank and lendor.  It pays to window shop for a good rate.  Often the dealer has special financing but many times your local bank is the best shot. 

Suppose you want to get into luxury models but can’t afford the upfront money to buy the car.  If you’ve a good job and credit you are probably a good applicant for leasing.  Unlike buying, leasing gives you the choice of not needing to fork out the deposit up-front.  And the rate of interest will be similar to what you would pay if you bought the auto but you will only be financing a fraction ofthe total car costs. 

Leasing does have its dangers though.  Terminating a lease early or defaulting on your monthly lease payments includes stiff financial penalties.  Your credit may be ruined.  As with any loan or financing, you need to make sure you carve out the monthly lease payment in your budget for the obvious future, at least for the period of the lease. 

Besides the finance aspect, making a buy or lease decision depends on your own particular lifestyle choices and preferences.  Think about what the vehicle means to you : are you the sort of person to bond with the car or would you prefer to have the excitement of something new?  If you’d like to drive a car for more than fives years, negotiate thoroughly and buy the automobile you like.  If, on the other hand, you detest the idea of possession and wish to drive a new auto every 2 – 3 years then you must lease.  Next, factor your transport wishes : How many miles do you drive a year?  How properly do you maintain your cars?  If you reply is : “I drive forty thousand miles a year and I don’t actually care much about my cars as I do not mind dealing with repair bills”, then you are likely better off purchasing.  Leasing is reliant on the assumption of limited-mileage, generally no more than twelve thousand to 15,000 miles a year, and wear-and-tear considerations.  Unless you can keep in the prescribed mileage boundaries and keep the auto in a good shape at the end of your lease, you may incur hefty end-of-lease costs.

Read more: discount auto insurance

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Buying A New Car Versus Leasing

Saturday, November 7th, 2009

In the past, we’ve looked at the “buy versus lease” equation from the perspective of a relatively healthy economy. In a robust economic environment, there are more benefits to purchasing a vehicle than leasing one. The only exception is the inability to drive a new car, truck, or SUV every two or three years. Because of the thoroughly ravaged economy, it is worth taking another look at the comparison.

Here we will approach the issue first by revisiting how the leasing process works. I'll describe the key factors that influence which deal is more appropriate during this sluggish economy. I’ll also explain a few of the dynamics that have changed in the industry over the past year.

How The Process Works

The negotiations for a lease are similar to those when purchasing a vehicle. After choosing the model you'd like to drive, you and the dealership need to agree on the price. This price is referred to as the capitalized cost. Much like your monthly payments on the purchase of a car are based upon a financing interest rate, your monthly lease payments are based upon a money factor. Incidentally, dealerships often try to obfuscate the money factor in the same way they obfuscate the interest rate. That should imply the importance of negotiating this factor upfront.

In addition to the purchase price, you and the dealer will agree upon a residual value. This is the value of the leased vehicle at the time you return it to the dealership. The lease agreement will detail annual mileage caps, maintenance items, turn-in fees, and other factors that can be negotiated.

Does Today’s Turbulent Economy Change Things?

The question is whether it makes more sense to choose a leasing arrangement over buying a car outright given the current recession. Indeed, the industry has gone through significant changes over the past couple of years. Credit markets have tightened, which has made it far more difficult for consumers to qualify for auto loans. Automakers and dealerships have responded by expanding their lease portfolios.

For a certain type of prospective car buyer, leasing arrangements are more attractive than ever. Not only are dealers more willing to offer better terms, but buyers who may want to get rid of their vehicles after a few years can simply turn them back into the dealership. They won’t be forced to unload their vehicles on a soft market.

The Frugal Driver Is Better Off Buying

Even given the advantageous leasing terms offered by dealerships, most frugal drivers will be better off buying their vehicles outright. Once depreciation has been removed, the cost of occasional repairs and the replacement of worn parts is far lower than a perpetual string of monthly payments.

The lease industry has become more attractive for the buyer that places a high value on driving a new car every few years. For most drivers, buying and maintaining the same car for its driving life is far less expensive.

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