New Car Buyers

Old vs New - The Benefit of Keeping the Car You Have

The battle scars are everywhere which often proves your car is paid in full! I personally prefer to refer to them as car character. There’s a story for each one, such as the green stained dent in the back-left corner of the bumper: that’s the one that reminds me of the time my mother in law borrowed the car and backed it into a giant trash bin. Or the massive dent on the front right bumper, the time my husband’s truck met my car as I was pulling up the driveway and he was backing out. Of course, there are interior marks of character on the inside as well such as the hole in the floorboard of the drivers side from way back when I used to wear high heeled shoes and apparently dug my left heel into the floor. Or the giant stain in the back seat from unknown ice cream spill by a child. Sure, it isn’t pretty, but it is paid for so each time a new knock or rattle or sputter brings me back to the mechanic I continue to answer his same question, “Are we keeping it?” with “Yep, still cheaper to fix than buying a new one.”

 At what point will the answer change? Well, obviously an extremely high cost repair will quantify an evening of math to decide but for the most part there are many of us that drive our cars until the wheels fall off.  

The average American keeps their car for around 6 years and the average age of American’s cars is a little over 11 years old.[1]

The average yearly repair cost on a ten year old vehicle ranges anywhere from around $300 a year to over $1000 a year.[2] With the average car payment around $550 per month this math works out quite well the keep the old dinged and stained car around a little bit longer.[3]  Even new cars often require repairs that go above and beyond the monthly payment.

With all that said, if you’re thinking about keeping your car as long as possible here are a few tips from the experts at Car Talk:

  • If buying a car with the intention to keep it long term, do as much research as you can before deciding on which one to take home.

  • Stay on top of recommended maintenance (especially fluid changes), don’t ignore concerns and never ignore engine warning signs.

  • Avoid keeping heavy items in your vehicle if possible, plan errands ahead of time to avoid short trips to and from home and when you can, simply keep your car at home.

  • -Find a trustworthy mechanic and take the time to communicate how long you hope to keep your car running.

Knowing the possibility that the day may arrive that you and your vehicle are forced to part ways, start saving now. As long as you don’t have a car payment, put a similar amount in savings each month to make that future transition much less financially painful.

In the meantime, be proud you kept that character filled payed off auto on the road. Besides, nothing gets a conversation going like a car scar story!

Blog by: Allison Green

Buyer Be Prepared Before a New Vehicle Purchase!

Whether off the line new or new to you, there are several things you can and should do to prepare to buy your next vehicle. We have compiled a few key items you can check off to help you be a smart and savvy shopper and hopefully a few steps ahead of the game.

Where to buy:

For sale by owner- For vehicles sold by the current owner you’ll need to take a few extra steps and precautions before even going to take a look at a vehicle for sale by these means.

  1. Only meet in public places where you are sure you will be around many other people. If possible only meet during daylight hours, if not ensure this place is well lit. 
  2. Take someone with you, know the sellers' name, phone number and description before you get there.   
  3. Ask for the VIN number and do your homework ahead of time.   
  4. Ask the seller if he/she has a clean title. If not, this is a red flag and it’s best to move on.

Dealerships- One of the best ways to find a good dealership is to talk to your friends! Where have they purchased a new vehicle and had a good experience? Check with the Better Business Bureau, and online reviews for dealerships.

Buy Here Pay Here- Payday loan’s little cousin offers almost anyone a car with often no income or credit verification. That comes with a big cost. According to Road and Track, the average interest rate at one of these dealerships is 19% and as high as 29%. They also often have a “one strike you’re out” late payment policy and will repossess your vehicle after one late payment.

Understanding financing:

Buying a vehicle on credit is the most common way American’s buy their rides. Getting the best deal on financing while protecting your credit requires a bit of being in the know.

  1. Credit Union, Bank, or Dealership financing? Per Bankrate, Credit Unions typically beat banks by 1%. Sometimes dealerships will have financing specials that are the best route to take, however, check with your bank or credit union first to see what they have to offer. Be sure to find out if there are better rates with a higher down payment as well.
  2. Know your credit scores before you go shopping. A low score finance approval may come with such a high-interest rate you might be better off spending a few months cleaning up that credit report before you buy.
  3. Protect your credit in the process of getting approved. Dealerships will often have your credit pulled by multiple lenders to shop for the best rate to offer you. When done in the same day they count as one hit against your credit score, however, if you go to several dealerships over a period of time and apply for a loan it could have a larger negative impact on your credit.

Used vehicle safety:

  1. Recalls- Go to: https://www.nhtsa.gov/recalls. This site allows you to search by VIN number.
  2. Vehicle history reports- There are several online sites that provide full history reports that can provide police reports, repair documents and insurance claims. Many of these reports are free and will help you to know what previous issues and or potential issues exist with the vehicle you are looking to purchase.

Insurance:

Sleep on it and call your insurance company before you buy! Any salesperson who pushes you to leave the lot in one of the lots vehicles is one to be concerned about. Get your data, go home, decide tomorrow. Get an insurance quote on the vehicle you’re thinking about picking up and making your own. There’s nothing worse than finding out the insurance policy is beyond your budget after you’ve already purchased your vehicle.

Blog By: Allison Green