1. Not researching online
Thanks to the internet, car buyers have a ton of information available to them these days. Websites like autoexpress.co.uk, Gumtree and Mobile.de all offer free information about car models, features, prices, and you can even find owner ratings, car suggestions, and reviews. Before you take your first test drive, you should compare cars in your price range, decide which car is right for you, and what price is fair to pay.
Once you have selected a car to purchase, be sure to get the registration number and look up the vehicle’s history report online for example in United Kingdom at https://www.vehicleenquiry.service.gov.uk/Default.aspx. It is important to check a car’s history even if it’s new. A lot can happen to a new car on the way from the factory. There have been cases of unscrupulous dealers trying to pass off vandalized or damaged cars as brand new. Plus, brand new cars damaged in floods or hurricanes often end up on the market. Avoid bad deals and lemons by doing your research online.
2. Shopping at just one dealership
When it comes to finding a great deal, it pays to shop around. Plan on checking out at least three different dealerships. You don’t want to do this in person — and you don’t have to. You can use Autotrader.co.uk and dealership web sites to view vehicle inventory.
Compare deals, and when you’re ready to buy, let the dealerships with whom you’re talking know that you’re keeping your options open. This can help you secure a great price. Also remember that it’s not just about money: You also want to choose a dealership you’re comfortable doing business with Autotrader.co.uk has dealer reviews that let you read what other shoppers have to say about the dealership with whom you might be working.
3. Buying new instead of used
New cars lose anywhere from £3,000 to £4,000 in value the second you drive them off the dealer’s lot. If you are financing your car with an auto loan and have little or no downpayment, this depreciation means that you are instantly “upside down” on your loan (your loan amount is more than the car is worth). New car scent is appealing, but is it really worth thousands of dollars? Instead, research slightly used models. The same model of car that is just one year older can be dramatically less expensive and can still come with the same warranties as the newest model. With all the money you’ll save by buying used, you can afford a lifetime supply of new car scent air fresheners.
4. Financing with a dealership
Dealership financing offices usually offer auto loan rates that are several points higher than what you could receive from an online auto lender or credit union. These rates are largely based on your credit score, as well. As part of the car buying process, you should shop and compare auto loan rates from various sources. Reducing your loan from 8% to 4% could save you a bundle on the car of your dreams.
5. Buying under pressure
You may hear that a car is “the deal of a lifetime” that happens to only be good on that particular day. But shopping for, buying and driving away with a car in just a few hours is unwise. After all, this is a major purchase that can affect you financially for years to come, so you have the right to sleep on it. And Reed points out that when you express hesitation, you may well get a better offer later on. If you get too much pressure to buy the car that very day, it may be best to walk away.