What to know before you head to a dealership, and what to ask once you’re there
Finding the right car and then negotiating the best price can be a whirlwind experience. So what do people who have recently purchased a new car wish they had considered more carefully? We asked CR followers on social media and got a whole host of suggestions, including how to beat dealership sales tactics, learning the cost of maintenance, trying out the back seat, and much more. Then we turned to the pros at our Auto Test Center—who, in addition to their expertise, anonymously purchase 40 to 50 vehicles a year for Consumer Reports to test—for the advice they give family and friends. In this article
“It’s more important than ever to do your homework before purchasing a car or truck,” says Jake Fisher, senior director of auto testing for CR. “With record prices, people are holding on to their cars longer than ever, so the decision you make should be one you’re going to be happy with.”
Between readers’ experiences and our know-how, we can prepare you for anything that might come your way the next time you want to buy a car. Ready to gain some car-buying superpowers? Read on.
Buying a car is a big decision that requires careful consideration With high costs and many options, it can be overwhelming to know where to start By thinking through these 9 important factors, you’ll be on the road to finding the right car for your needs and budget.
Safety Features
One of the top priorities should be safety. Look for advanced driver assistance systems like automatic emergency braking, blind spot monitoring and rear cross traffic alert. These can prevent accidents and save lives. Don’t assume these come standard – check manufacturers’ websites to see what features are included with different trim levels and option packages. Also test drive the systems to make sure you understand how they work.
Gas, Hybrid or Electric
Determine whether a traditional gas-powered car, hybrid or fully electric vehicle best fits your driving needs. Gas cars have lower upfront costs but higher ongoing fuel expenses. Hybrids cost more but have great mpg. EVs have no gas costs but a higher purchase price. Compare total ownership costs over 5-10 years to see what makes sense. Also look into tax credits that can help offset the initial cost of hybrids and EVs.
Towing, Storage and Other Functional Needs
Make sure the vehicle has the capabilities you require. Look up tow ratings if you’ll use it for hauling. Check trunk space and dimensions if you regularly transport large items. See how child seats fit if you need room for kids. Take your own car seats to test. Don’t pay for off-road performance you won’t use. Understand your functional needs so you pick the right car.
Expected Maintenance and Repair Costs
Maintenance varies greatly by brand and model. Research typical costs for oil changes, tire rotations, brake jobs and other routine needs. Also look into a car’s reputation for reliability and costly repairs outside of warranty. Factor this into your total cost of ownership. Some brands provide free maintenance – find out what’s included and for how long.
Resale Value
Most people don’t keep a car for its full lifespan. Study how well a car holds value over 5-7 years, as you may sell or trade it in. Go with brands known for retaining value. This also gives you more equity should you need to get out of the car before paying it off.
Warranties
New cars come with factory warranties but terms vary. Understand the length miles and coverage inclusions. Extended warranties can be bought but may not be worth it. For used cars look into Certified Pre-Owned programs from dealerships which provide additional warranty coverage.
Loan Terms
The loan length impacts total interest paid. Aim for 3 years on used and 5 years on new. Stretching to 6-7 years lowers payments but leads to much higher interest and owing more than the car is worth should you want to sell. Getting preapproved from your own bank means you know the rate you actually qualify for, and gives you bargaining power. Don’t take dealer financing without shopping around.
Total Costs
Look at the full price picture MSRP interest, taxes fees, insurance, fuel and maintenance. Get an out the door quote from the dealer including all these items. Use a car affordability calculator to ensure total car costs fit your budget. Ideally this should be less than 15% of your monthly take-home income.
Used Car Condition
Buying used can save substantially, but inspect thoroughly first. Look for paint overspray or mismatched colors indicating prior collision repairs. Review vehicle history for major issues. Ensure it’s been properly serviced. Take a test drive to feel for vibrations or sounds signaling problems. Hire a mechanic to inspect it prior to purchase. Consider Certified Pre-Owned to get peace of mind.
By taking the time to thoroughly research and evaluate these key considerations, you can make an informed decision when buying your next car. This will help you get the right vehicle at a price you can truly afford, for the long run. Don’t let the sales process and shiny new models distract you from making a choice that fits your needs and financial situation. Stay focused on the factors that matter most and you’ll end up happy with your purchase down the road.
Whether It Has Essential ‘Extras’
Why it’s important: Some vehicles are specifically designed to do certain tasks, such as towing a camper or driving off-road. You need to know what the car you plan to buy is capable of before you head to a dealership or you could make an expensive mistake. Paying extra for capabilities you don’t need is a waste of money.
Steps to TakeKnow how much it can tow. Even vehicles that look exactly the same on the outside can have a towing capacity that varies by thousands of pounds, says John Ibbotson, CR’s chief mechanic. Much depends on option packages, trim levels, and engine choices. Calculate how much you need to tow before you buy, and make sure the vehicle you’re choosing will be up to the task. Check the car’s manual and ask a salesperson to help you.
Think about the road conditions you’ll encounter. Rugged four-wheel-drive trucks and SUVs are impressive machines great for taking off the beaten path. But if it’s just inclement weather you’re worried about, you probably don’t need such a robust vehicle—or its added weight and lower gas mileage. An all-wheel-drive system—or even a front- or rear-wheel-drive vehicle with winter tires for cold weather and snow—should do the trick depending on your situation, says Ryan Pszczolkowski, tire program manager at CR.
Because every used car is different, buyers face more potential pitfalls than they do when purchasing a new vehicle. Here are three things to keep in mind during your search.
The length of the warranty: Ask if there’s any original warranty coverage left on the car and, if so, how long it will last and for which components. If you want more coverage, consider buying a certified pre-owned car, which typically has additional years of warranty coverage direct from the manufacturer.
Whether it has been in a crash: A car that has been fixed after a serious crash can have a lower resale value, and hidden safety and performance issues. Not all crashes show up on a vehicle history report, so look for areas of the body where the paint doesn’t match the rest of the car, crooked headlamps and trim pieces, and uneven gaps between body panels.
If it needs new tires: Are the tires the right size, speed rating, and load rating for the vehicle? Tires (including the spare) older than 10 years should be replaced.
Whether Your Next Car Will Be Gas-Only, Hybrid, or Electric
Why it’s important: Though hybrids and EVs cost more up front, “the higher purchase price can often be offset by lower operating costs,” says Chris Harto, senior energy policy analyst at CR. As you budget how much you can afford to pay for a new vehicle, it can help to know what your savings on operating costs might look like.
Key ConsiderationsHybrids can earn back their higher cost in as little as two years. “For many Americans, the monthly fuel savings can offset a slightly higher monthly payment, saving money from Day 1,” Harto says. Learn more about hybrids in our guide to hybrid cars.
Plug-in hybrid electric vehicles save the most if you take short trips. That’s because they have an electric-only range that’s usually between 20 and 50 miles. Beyond that, the gas engine kicks in. So check the window sticker to see what kind of fuel economy you’ll be getting when the car is in hybrid mode. Some PHEVs qualify for federal tax credits, too.
In addition to their other benefits, electric vehicles can offer serious savings. How much (if any) depends on what kind of car you’re purchasing and where you live. Our guide to EV ownership costs can help you decide. EVs may also be eligible for tax savings of up to $7,500, but qualifying for a federal tax credit requires meeting certain conditions, which we’ve outlined in our guide to EV tax credits. See our Electric Vehicle Savings Finder to check.
For several reasons, leasing an EV may be a better option than buying one. It’s easier to get the federal tax credit when leasing, and you don’t have to worry about volatile prices on new EVs or getting stuck with outdated technology.
Illustration: Heemin Yang Illustration: Heemin Yang
HOW TO BUY A CAR | DO NOT DO IT Without Knowing These 5 Things
FAQ
What do you need to know before buying a car?
- Know what rate you’re approved for. …
- Know which factors impact your payment. …
- Know the pros and cons of 0% APR vs. …
- Know if new or used is right for you. …
- Know the differences between a loan and a lease.
What are the factors you need to consider when selecting a car to buy?
- The Direct Cost of Purchasing a New Vehicle. This is the most obvious cost you’ll need to consider. …
- Your Monthly Payment. True, this is another way to calculate the direct cost of your new vehicle. …
- Auto Insurance. …
- Maintenance and Repairs. …
- Fuel Costs.
What is the 20/3/8 rule for buying a car?
The 20/3/8 rule is a guideline that suggests you put 20% down on a car and repay the loan over three years. Applying the rule correctly will also require your monthly payment and car expenses be 8% or less of your income.
What is the 30-60-90 rule for cars?
What should I consider before buying a car?
Buying a car is a big purchase, so you want to make sure you are able to finance a potential vehicle. Start by checking your credit score; this is one of the most significant things you should consider before buying a car. The higher the credit score, the better chance you have of negotiating a lower interest rate on an auto loan.
How to buy a car?
Trade-ins, payments, purchase price and down payments: These essential elements of how to buy a car can help you find the right one for your needs and wants. There are a lot of factors to consider when buying a car, from monthly payment to loan rate and trade-in value.
What factors should you consider when buying a car?
There are a lot of factors to consider when buying a car, from monthly payment to loan rate and trade-in value. Here are some car buying tips to help you be more successful in the car buying process.
Should you buy a new car?
Buying a new car can be both exciting and overwhelming, especially if it’s your first time making such a big purchase. With so many considerations, from the make and model to the price and financing options, it’s easy to feel lost in the sea of information.
How do I choose a good car?
Calculate how much you need to tow before you buy, and make sure the vehicle you’re choosing will be up to the task. Check the car’s manual and ask a salesperson to help you. Think about the road conditions you’ll encounter. Rugged four-wheel-drive trucks and SUVs are impressive machines great for taking off the beaten path.
What should a prospective car buyer know before buying a car?
Before buying a car, it is important to know what other vehicles are available on the market and how much you can afford. Once you have this information, you can start shopping around.