| We all dread walking onto that car lot and | | | | good rates. You can also find some lenders |
| being approached by a salesman that we just | | | | for your area and their published rates by |
| know is going to try to pressure us into | | | | visiting If your lender offers extended |
| buying today and spending more than we want | | | | warranties, be sure to get the pricing and |
| to spend. It doesn't have to be that way. | | | | factor that into your payment. Don't tell the |
| With just a little preparation, you can make | | | | dealer that you are paying cash. Let them |
| sure that you get a great value and protect | | | | believe they will be doing the financing |
| your investment Don't fall in love with | | | | because they make more money when they |
| having a brand new car. The newer the car, | | | | arrange your loan. The old idea of getting a |
| the worse it depreciates, with the first year | | | | better deal with cash simply does not apply |
| being the very worst. By finding a used car | | | | any more. The salesman may get excited about |
| that is still under factory warranty, maybe | | | | your cash, primarily because he's paid to be |
| two or three years old, you will avoid the | | | | excited about anything you say, but the |
| worst of the depreciation and you can usually | | | | person making the decisions only sees the |
| buy a relatively inexpensive extended | | | | bottom line. If he believes the finance |
| warranty that will cover everything that the | | | | department can recover some of the lost |
| factory warranty covers. Look for a warranty | | | | profit on the sale price, he'll be more |
| that has a small list of excluded repairs | | | | willing to sell the car for less. After you |
| rather than a big list of items that are | | | | have agreed on a price, it will be time to |
| covered. In the warranty book that originally | | | | sit with the finance manager and, if he |
| comes with a car, you will see a warranty | | | | doesn't give you a better interest rate than |
| that essentially says that everything except | | | | you found on your own, hand him your bank |
| certain normal wear and tear items | | | | check or draft. Be sure to get his price on |
| (alternators, tires, batteries, light bulbs, | | | | the warranty. Even if he beats your bank's |
| etc) is covered. You want to look for similar | | | | rate, a higher priced warranty could outweigh |
| wording on your extended warranty. A long | | | | the savings in interest. The simple test is |
| list of covered items is always much shorter | | | | to compare payments over an equivalent number |
| than the list of things that can actually | | | | of months. The total that comes out of your |
| break. If the warranty company is able to | | | | pocket is really all that matters. Don't be |
| claim that a covered item broke because of | | | | afraid to walk on a deal. By doing your |
| the failure of a non-covered item, they will | | | | research, you will know if you are getting a |
| deny the claim. Be sure any warranty is | | | | bargain. If a dealer paid too much for a car |
| transferable because that will make a big | | | | it's not your problem and you shouldn't be |
| difference in resale value and desirability | | | | penalized. You can find another car. The |
| when it comes time to sell. Once you have | | | | value of the car in two years will have |
| decided on a make and model, decide how much | | | | nothing to do with the amount you spend on it |
| you are willing to spend on it buy | | | | today so why lose more than you have to? |
| researching the value with NADA at or Kelley | | | | |
| Blue Book at Try to pay somewhere between | | | | Kevin Maher is the Agency Liaison at Debt |
| trade value and retail value at a dealer. | | | | Management Credit Counseling Corp (DMCC), a |
| Mileage makes a difference, so be sure to | | | | 501c(3) non-profit charitable organization |
| know what effect low or high mileage has on | | | | offering free financial and budgeting |
| the value. Have your financing arranged in | | | | education across the USA. |
| advance. Credit Unions frequently have very | | | | |