12 Questions to Ask Yourself Before Buying a Car
The decision has been made, and it's time to buy a car. But before you do, take time to ask yourself these 12 questions. Answering these questions will help you decide on what you want, and don't want in your next new car and will also keep you from making any bad car buying decisions.
A vehicle is normally the second largest purchase, next to a house for most people. It's easy to get excited when presented the opportunity of buying a new car.
Sometimes people get so emotionally wrapped up in the euphoria of the car buying process, they tend to make some really bad decisions. Dealers and their salesmen are well aware of this, and will prey on this weakness to pad their pockets.
If you ever catch yourself justifying something or rearranging your personal financials to buy a car, it's time to step back, take a deep breath, or even walk away if you need too. The car will still be there tomorrow and if it's not, I promise - The manufacturer will make more!
Before you decide to go to a car dealership and let some smooth talking car dealer like myself talk you out of your hard earned cash. Slow down and ask yourself a few questions first.
1) Do You Really Need to Buy a New Car?
Think about the reasons you want to buy a new car, do you really need one or can you still drive your current vehicle? You know the one that's almost PAID OFF or has NO payment attached to it?
Is your current vehicle becoming unreliable or your maintenance costs are starting to climb? Is your family starting to outgrow your current vehicle and you need a new one to keep them safe and legal? Or are you just wanting a new car to "treat yourself?"
Ask yourself if you really need to buy a new car right now, if you can afford it and you really are in need of one, go for it.
2) Can You Afford a New Car?
Most financial advisors and experts in the field say that your car payment should be no more than 10% of your gross monthly income on a 48 month term after putting down at least 20% of the purchase price. An example would be if you make $3,500 a month (before taxes), your max payment would be $350. Your total purchase price before taxes, interest, and money down would be $16,800.
Most lenders on the other hand will take 20% of your gross monthly income to determine how much car payment you can afford. This means if you make $3,500 a month, your max payment can be no more than $700. As you can see, this can be very dangerous for your financial well being.
My advice is to make a personal budget of all your expenses and determine what you can comfortably afford with some money left over for you to enjoy. Once you have a max payment, pick a vehicle that fits within or below your figure.
Buying a new car will bring some added expenses to your budget, especially if you don't currently own one. You should take time to budget these into your ownership costs, some of these costs include:
- Car Payment
- Car Insurance
- Preventive Maintenance
- Repair Costs
Taking these additional car ownership costs into consideration will allow you to enjoy your new car without stressing over how you're going to pay for it.
3) What Kind of Car Should You Buy?
The vehicle choices out there are almost overwhelming. There are so many different manufacturers, makes, and models to choose from, where do you start?
First ask yourself what your driving needs are, and more importantly, what do you like? If you're single with no plans to get married and like to go fast, you may want to go the sports car route. Understand that insurance and fuel cost may be higher but that's just part of the costs of ownership.
Will you be towing a boat or trailer? You may want to look into trucks and their towing capacities. I've seen many people buy vehicles only to find out later it's not rated to tow what they need. Continuing to tow or haul too much weight you're guaranteed to mess up a vehicle quickly.
There are several free online consumer automotive services that allow you to research and compare vehicles online. Using these websites will help you narrow down your search without wasting time driving all over town and having to haggle with pushy salespeople.
Recommended New Car Shopping Sites
CarClearanceDeals has one of the largest new car dealership networks in the world. Select the make and model you're interested in and they will instantly search clearance pricing within your local area. Don't forget to select as many dealers as possible to increase your chances for the greatest discounts and savings.
Browse new car inventory at Car Clearance Deals here.
MotorTrend is one of the best kept secrets on the Internet. Best known for their automobile magazine, MotorTrend also has a vast dealer network across the nation. They're referral service is 100% free and there's no obligation to purchase. Just pick the vehicle you're interested in, select all your local dealers, and receive deep discount Internet pricing.
Search new car inventory at MotorTrend here.
Edmunds is one of the oldest and best new car research and review sites on the internet. Their huge dealer network allows you to shop, research and compare millions of new cars so you can find the exact vehicle you're looking for.
Search new car inventory at Edmunds here.
CarsDirect has been in business since 1998 and has all the right tools to help you find your next new car. They offer a no-hassle experience from configuring a car to making the final purchase. You'll find your next car quickly and easily.
Browse and price new cars at CarsDirect here.
If you're just testing the waters, pre-shopping or seriously wanting looking to buy a new car, the automotive websites above are the best of the best. They'll provide you with valuable information to help you do reliable research so you can make a good car buying decision. You can also use them to request free, no-obligation price quotes from dealers in your local area to get a feel of what the market is on the vehicle your considering.
Once you find a vehicle you'd like to buy, read my section on how to start a low new car price bidding war online to guarantee you pay the lowest price.
4) Should You Buy New or Used?
Buying a new car will provide you peace of mind with a factory warranty and knowing that you're the first one to own the vehicle. New cars are normally more expensive and depreciate at a faster rate over the first couple years of ownership.
You can buy the same car used, with a few miles on it, and save some money. With a used car, the previous owner takes the initial depreciation hit and leaves you with savings that can be upward to a few thousands of dollars. Many times you'll find that you can buy a used car with more bells and whistles on it cheaper than what you can buy the same vehicle new.
If you decide to purchase a used over new. Make sure you have the vehicle inspected by an independent certified mechanic and you review the vehicle's history. Read my complete guide on vehicle history reports here.
If you purchase a used car you'll most likely want to protect your investment with an extended auto warranty. Most dealers will offer some type of protection for a cost. As with vehicle pricing, you should always comparison shop online so you get the best price. Visit my section on how to get free extended auto warranty quotes online here.
Buying a new or used car is really up to what you want and what you can afford. Personally, you can get a whole lot more car for the money if you buy used. Some people want the peace of mind that comes with buying a new car and don't mind paying for it. No matter if the vehicle is new or used, it will be new-to-you!
5) What Do You LIKE About Your Current Car?
This is a great question to ask yourself. You've been driving your current car for a while now. What are the things you really like about it? What made you buy the car in the first place? The way it handles, the safety features, the gas mileage, the way you look in it, etc...? Write them down and keep them for when shopping for your new car.
6) What Do You DISLIKE About Your Current Vehicle?
Buying a new car gives you a chance to get away from the things you dislike about your current car. Think about the things you dislike about it. Too big, too small, lack of power, no sunroof, maintenance repair costs, blind spots, hard to park, the way you look in it, etc? Write these down also so you can remember what you don't want when buying a new car.
Use this handy Car Payment Calculator to estimate the payment on any vehicle.
7) Will The Car Fit in Your Garage or Parking Spot?
This may sound like a funny question to ask yourself but it does happen occasionally. It's one of those OMG moments and by the time you find out, it's too late.
The Ford Excursion made a lot of people upset once people found out they couldn't fit it in their garage after already buying it. If you're in the market for a large truck or SUV, make sure you take some measurements if you plan to park it inside.
The above principle applies to towing capacity. If you plan on towing something, make sure you buy a vehicle that's rated to tow or haul or you could end up destroying the vehicle over time.
8) Will All Driver's Be Comfortable Driving the Vehicle?
A Toyota Prius would be a nice little car that gets really good gas mileage. However if you're spouse is 6'6", he may have a problem driving or riding comfortably in your tiny compact car.
A Ford Expedition would be a nice big SUV to fit the entire family in, however you're 5'2" wife may have a hard time parking it or driving it within a big city.
These scenarios may not be common however you should think of everything when it comes to spending a lot of money on something your significant other will not want to drive. Who would buy a car without their husband or wife? Believe it or not, many people do.
9) How's Your Current Credit Score and History?
If you have some bumps in your credit history you will have to pay higher interest rate and essentially pay more for the vehicle if you're financing it. Before applying for any kind of loan you should always get and review your credit reports and scores. You can get your credit report, score, and history from a reputable online company such as MyFreeScoreNow, they are a trusted leader in the industry. Doing this will give you negotiating leverage with a dealership and keep you from becoming a victim of any finance related car dealers scams.
Once you receive your credit history, bring any current loans or credit cards past due to current status. Pay off any outstanding collections, liens, or judgments. These kinds of bumps in your credit history will hurt you and cause you to pay a higher interest rate. Cleaning up these bad marks on your credit report will help increase your credit score and put you in a better position by receiving a lower interest rate when applying for your next car loan.
You can learn more about pre-approved car loans and how to use them to your advantage in my automotive finance advice and tips section.
10) Do You Have a Down Payment?
It may be attractive to not put any money down if you have the credit score and history to support it. However, you may want to put some thought into it first. I have always recommended you put at least 20% down of the purchase price of the vehicle. Doing this you will greatly reduce your chances of becoming upside down and will also reduce the amount of money you'll pay in interest charges.
This is a large amount of money for some people. If you're unable to put down 20%, at the very least put down the amount of tax, title, license, or any extra fees associated by your state. Paying interest charges on TT&L is just crazy.
If you have bad credit you may have to come up with a minimum of 10% down or more of the purchase price of the vehicle. Read more about the pros and cons of having a down payment for a new car in my section on
Read my article on how much cash should you put down on a new car to learn more about the pros and cons of having a large down payment when buying a new vehicle.
11) Will Your Family Grow or Driving Situation Change?
You would be surprised how often this question is overlooked. It's easy to get overwhelmed with the shiny new sports car sitting on the showroom floor. The car salesman then proceeds to show you how easy it is to buy it and you think to yourself how good you'll look driving it. But wait you came in for a four door sedan.
Ask any mom lifting an infant into or out of a car seat from the backseat of a 2 door vehicle and I can promise you they'll tell you it's a major chore.
Think twice about you and/or your family's future before buying a vehicle that does not have enough room or enough doors. Your spouse may be very unhappy with your vehicle selection.
I don't think I need to say anything more about this subject.
12) How Many People Will Normally Ride in Your Vehicle?
This question is an extension of the above question. What will be your driving habits with your new car? Do you have a family of six and need a car to take everyone on vacation in? Do you haul people all the time? Do you need a car to just run quick errands in or go to and from work?
I somewhat repeated this question because of its importance. Over my career I've witnessed people by the wrong car for their family time and time again. Once you buy a car, even if it's not right, you will not be in a good position if you have to return or trade the vehicle.
Take the time to do your research upfront and buy the right car the first time. Take this question seriously, give it a little thought and don't buy a car that's too big or small for your family!
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Recommended Sites for Online Car Shopping
CarClearanceDeals and CarsDirect are the quickest way to compare new car prices in your local area. These online sites will provide you with free, no-obligation price quotes and the discounts you receive will give you confidence on your next new car purchase. Walk away from the dealership knowing you received a good deal, not hoping you did.