What’s my car worth? Find out now
7min 15s read
December 2, 2017
You’ve saved all year, your car is breaking down, and that weird noise it’s making is probably going to cost more to fix than it’s worth. You’ve made the exciting decision of buying a new car – but where do you start? We’ve narrowed down the top 10 most important questions to ask yourself before purchasing your next vehicle.
If you’re ready to consider purchasing your next car, read on to see what you should be asking yourself before you make the investment.
1. The Extras – What features do I want and need?
It’s important to consider what you need in a car. If you’re buying new, you’ll have the option to add extra features. It might seem more cost effective to say no to everything, but there are certain features that can help you save in the long run. For example, paying for key coverage can help you avoid hundreds of dollars if you’re constantly losing your keys. Ask yourself what you need from a car to make your life easier.
You might be able to get away with no heated seats, but if you answer a lot of calls on the road, you’ll definitely need that Bluetooth system. Make sure to understand what’s included in the price of your car, and don’t get caught up in unnecessary extras. Many cars come preloaded with everything you need, so read up on the specifications of the car.
2. Negotiation (know what you want, how much you’re willing to spend)
Dealerships are a business, and businesses need to profit. Knowing how much the car is worth is the first step in helping you negotiate towards a price that works for you and the dealer. Search for incentives from dealerships that will help lower your overall spending cost. Remember not to get too caught up in the deal – it could deter you from finding a good vehicle. The good thing is that dealerships are competitive and they know you have options.
Although it’s a strong buyer’s market, you’ve still got a lot of research ahead of you. Purchasing a car is not the time to be an impulsive buyer – there are far too many risks involved in getting the wrong car. Visit several dealerships to compare pricing and the reputability of the dealer’s service – it’ll matter for the life of your car.
3. Research (do your own) on the car AND the dealership
It may seem obvious that you have to do your research, but what should you be researching? With great, reliable, and unbiased sites like Consumer Reports, there’s no excuse to not know everything about the car you want to buy. For example, not knowing the actual value of a car gives the dealer a lot of power in giving you a “good deal.” Look up the invoice price so you know what the dealer pays the manufacturer for the car – you’ll need this to negotiate.
4. Warranty (maintenance/repair costs) – What operating costs will I have to pay?
Ask yourself – do you regularly take care of your car or do you only take it in once every two years? This can help you decide on what kind of coverage you want to add, but don’t forget that warranty is there for the unexpected occasions.
To make sure you don’t get stuck with a lemon, make sure to buy a car still under manufacturer’s warranty (if it’s used), or pay the extra for extended warranty on your new car. If you’re strapped for the extra cash, you can always tuck away what little you have and use it as an emergency fund for those unforeseen breakdowns.
5. Financing – What is my budget? (through the dealership vs. outside)
Dealerships will do their best to make the process of buying a car as smooth as possible, and that involves helping you finance your car. Look for dealerships offering 0% financing, with added incentives. It’s important to consider and look at the costs outside the dealership as well.
6. Do I want to Buy or Lease?
Buying a car can seem costly upfront, but you have to look at the costs that add up when leasing a vehicle. You’ll need to read and understand your lease, including knowing the termination charges, mileage and wear limits, overage charges, and buyout fees. If you know you drive a lot and the mileage allowance will be used up, then consider buying the vehicle instead. Leasing a vehicle can be a great option for those interested in walking away from a vehicle at the end of the lease, or trying a different car after a few years. For those customers that have a monthly spending allowance or their company pays their car expense, leasing a vehicle can be the perfect fit.
7. New or used – how long do you intend to keep this car?
Ask yourself if you are planning to keep the car for 8+ years, or if you just need a car for 2-4 years until you can afford something new. You can find great used cars that still have great value and are still under the manufacturer’s warranty. A new car will be more expensive at first, but the resale value will help you recoup costs if you ever need to sell. If you’re buying a used vehicle, look for a dealer who’s been in the business for a long time and who will stand behind the car. Because remember, a large majority of used cars no longer have a factory warranty and if something goes wrong with the car, you need a dealer that is reliable and can help you service the vehicle.
8. Research the Trade-in Value of the Car
It’s vital to know if the car you are buying will hold its value. This question will be easier to answer when you decide on how long you intend to keep the car. Certain cars and models have a higher resale value, which can help you trade it in a few years down the line. The price that you may get for selling a vehicle to another individual is often higher than what a dealer can provide for the vehicle. This is because the dealer will need to service and prepare that vehicle for re-sale.
Use a tool like our website to help you determine the value. Below are three other great steps you can take to help you with your research:
Use online resources like caranddriver and motortrend to research the previous make and model of the vehicle you’re interested in to see how well it holds its value.
Ask the salesperson if the model is due for any major overhauls in the next model year.
Take a look at lease options and the ‘residual values’ to see how the manufacturer values the vehicle two or three years from now.
Trade in values can range widely depending on the condition, make, and year of the car, which is why being able to answer this question is crucial to the buying process.
9. What kind of power do I need (gas vs. hybrid vs. electrics)?
If you’ve decided to go green, you’ll have great options when it comes to hybrid and electric cars. You’ll save money at the pump, but consider the overall costs. For example, hybrids and electric cars can be very expensive and compete against fuel-efficient cars that much cheaper. If you value powerful acceleration and a smoother drive, investing in a high-powered car might be your best option.
10. What are the experts and consumers saying?
How are the reviews? Who has done an extensive review of the car, all its features, and what other buyers have said? It’s important to stay up to date with the industry and to look at what the experts are reporting to help you find the models getting the most well rounded reviews. Read reviews from owners to understand how they feel about their purchase. Look for a dealer who’s been in the business for a long time and who will stand behind the car.
Buying a vehicle is often one of the largest purchases someone can make in his or her life. As each year passes, the decision only gets harder. With more options popping up, it can be hard to know where to start. Choosing from the seemingly endless choices can be daunting. Don’t let the process deter you – buying a car is an exciting moment, and if you remember to take your time and ask yourself the right questions, you’ll be on the road with your dream car in no time. Pick the right vehicle for you but more importantly choose the dealership that takes pride in treating their customers the right way. Customer service and transparency goes a long way in the car buying process.