Save on a New Car
This is the ideal time to buy a car. From now till the end of the year, dealerships will be anxiously trying to clear out the 2008 model-year cars because of the flood of 2009s coming in. And when dealers are desperate, consumers can find some great deals.
Here are some suggestions for making the best deal possible.
* Figure out how much you can afford, even before you begin shopping. Calculate the monthly payment and other costs—including insurance, gas and maintenance. A good rule of thumb is to allot 25 percent of your family's take-home pay to cover the total costs of an auto.
* Look for dealer incentives. Dealers may offer cash back or financing incentives. Cash back reduces the selling price. Financing offers a low-interest rate on a loan.
* Visit the dealership's website and work with an online person. They are more likely to offer an initial price closer to the invoice, while most on-site salespeople start at the sticker price and negotiate downward.
* Be wary of extras. Do you really need an extended warranty, rust-proofing, fabric protection and other add-ons that inflate the price tag? Probably not.
* Shop around. You can do it all online or on the phone.
* Don't be afraid to haggle, and be prepared to walk away. There will always be another deal.
* Don't automatically take the loan arranged by the dealership. Investigate other lenders and crunch the numbers. You may get a better deal by using a local bank and taking a dealer rebate.
* Base the length of the loan on your budget. The longer the loan, the lower the payments, but you don't want a loan that outlives your car.
Published 08/29/08
