How to Buy a Car Without Completely Destroying Your Bank Account

If you are car buying and you’ve noticed that dealerships in your area don’t have that much inventory on hand, you’re not alone. As we head into the third year of the Covid-19 pandemic, automakers are still struggling with production issues, parts shortages, and more. So, that means one thing: while the number of new vehicles for sale has gone down, prices are rising.

Is there a way to buy a new car right now without spending a fortune? We have some pointers on finding a good deal on new vehicles without breaking the bank.

It’s hard to find a deal

An overhead shot of a Fresh Auto car dealership in Moscow, Russia
A Fresh Auto car dealership | Valery SharifulinTASS via Getty Images

The pandemic threw the auto industry for a loop, with plant shutdowns continuing and fewer cars produced, according to U.S. News. Meanwhile, the demand for new vehicles continues to grow. Even used cars have seen significant price increases.

Believe it or not, you can still find a good deal on a new vehicle even under the right circumstances. You’ll need to do some research, be spontaneous, and be willing to compromise. It’s also important to have a good current understanding of your finances so you’ll know how much you can afford.

Be prepared for your car buying adventure

With a limited number of new vehicles available, you need to be ready to buy when you find one that’s ideal. You need to know beforehand what you’re looking for and be in a position to pay for it or finance it right away. 

The same car buying methods still apply. You need to know ahead of time what vehicles would be a good match for your budget while meeting your needs. Keep in mind that while you have an ideal car in mind, you should have other options on your list that are comparable.

You’ll also want to research the prospective vehicles to see what industry experts and other consumers have had to say about them. You’ll want cars that are reliable, free of dangerous or expensive issues, fuel-efficient, and able to fulfill your day-to-day needs.

It’s a good idea to have financing in place before you find the vehicle you’re seeking. With a pre-approved car loan, you’re all set when you arrive at a dealership and find a car that will work for you. 

If you have a vehicle to sell or trade-in, be proactive. Know its current market value and clean it up ahead of time. Ensure you have all the needed paperwork like the title and any service records ready to go. If another customer wants the same new vehicle as you, the dealer won’t wait weeks for you to obtain your title for your trade-in from the bank. You might even consider selling that one before you buy the new vehicle. 

Finally, if you can find an instant cash or cashback deal, grab it. They can help lower or remove the interest required on a car loan.

Keep to your budget

It may seem like a good idea at the time, but getting a bigger auto loan might not be a good idea down the road. You pay more interest because you’re financing it longer. Sure, there are reasonable interest rates right now, but that doesn’t necessarily justify it. 

Also, be sure to visit several dealers instead of impulse-buying at the first one you reach. While you’re looking for specific cars, you also need a dealer that will make you a solid offer. 

Being flexible will serve you well if you are car buying. With limited inventory, you might not easily get the specific trim, color, or features you want. Are you willing to pay more to get those specific things? If not, be ready to compromise. 

Additionally, don’t completely rule used vehicles out. There are many benefits to buying a used vehicle, particularly those in certified pre-owned car programs. They cost less than new cars, have been thoroughly inspected by trained technicians, have warranties, and cost less.

Leasing also gives you an alternate route if you can’t find exactly what you want right now, particularly if you won’t be putting a lot of miles on the vehicle. If you can find a good deal on a lease deal or a car with a strong resale value, you could lease it now and buy a new vehicle when market conditions improve.

At the end of the day, be patient. If you get everything ready, you’ll be able to snap up that great deal on the stop when you find it. 

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