Buying You First Car? Here Are Some Things You Should Know
Don't let buying your first car be intimidating
Purchasing your first vehicle is a big decision. It is after all, the second largest purchase you will make in your life. The process of buying a vehicle can be confusing for first time buyers but here are some things you should know when you are looking at buying your first vehicle.
1) Research is Not a Bad Thing:
We live in a modern world; information is just a click or tap away on our smartphones and computers. Almost every brand of vehicle has a website designed to show you their products and the choices you the consumer have. Have a look through the different brands online and look at what they offer and find a vehicle you think will suit your lifestyle, when you have found something that matches visit your local dealership to get more information.
2) New or Used?
This can be a difficult choice. There are benefits to both options.
New Vehicles will often have Manufacturer Discounts and Rebates available along with Finance/Lease rates available if that manufacturer has it's own finance institution. Dealerships may also work through the major banks to get financing for you. New vehicles will also have full manufacturer warranty from the day you pick it up which means if something goes wrong it should be covered under manufacturer warranty.
Used Vehicles can vary from dealer to dealer. Most used vehicles are traded in by customers of the dealership, brought in off lease or are purchased buy the dealer at auction. These vehicles can be cheaper than a new vehicle and will have some mileage on the odometer. These vehicles will generally have a higher finance rate than a new vehicle unless there is brand specific programs that offer better rates on used vehicles. Used vehicles offer some nice options for first time buyers because there is such a variety of vehicles out there. You may find one that has been lightly driven and is 2-3 years old, you can find one that may have some mileage on it but will suit your driving habits and the price works in your budget. Either way you should be able to find what you are looking for and get a vehicle that fits in your budget.
Always check where you are buying a used car from. Make sure it is a certified reputable dealer that is registered with the Ontario Motor Vehicle Industry Council (OMVIC). These dealers and their sales staff will be registered with OMVIC and licensed to sell vehicles. Buying from a non-registered vendor could lead to issues should there be a problem with the transaction or the vehicle itself.
Warranty on used vehicles always begins from when the vehicle originally went on the road, this means that you could be buying a vehicle where the term on the warranty has expired and therefore you will have no warranty. Without any warranty if something goes wrong you could end up with a large bill for the repair. Make sure the vehicle has a CarFax report which will disclose all information about the vehicle such as accidents, recalls and lien disclosures.
3) What is your budget?
How much can you afford a month for a vehicle? One thing you should know going into a meeting with a Sales Representative is how much you can afford per month. One of the biggest mistakes you can make is leaving yourself “car poor” because you are paying so much for your car payment you do not have any disposable income.
The easiest way to avoid this problem is to plan out exactly how much you can afford for a car payment. If you can afford $400 a month then make sure you stay in the budget and do not worry if you find something you love, and it is under your budget. This just means you can save more or have a little more disposable income at the end of every month.
If you plan to finance your first vehicle, look at the amount of time you are going to finance for. The Term of your loan is the amount of time it will take you to pay off. Some dealers will offer terms that go as long as 108 months. While the payment may seem really low, this means you are paying for the vehicle for 9 years. If you hit your payment at 60 months (5 years) why look at the lower payment that takes your term up to 9 years?
4) Find “your person”
This goes without saying. We all love to tell someone “I know a guy” or “I know the person you should talk to.” Buying a vehicle is no different. If you find the right sales representative that you can recommend to everyone you know than that is the person you want to deal with. If you meet a sales rep who shows little interest or is just after a pay cheque it can make your first buying experience a negative one and that is not what you want.
Hopefully these points give you some insight into buying your first vehicle. Of course if you have any questions you can reach out to myself or your local dealership and they can answer any questions for you.