Finance > Finance - How To Beat The Auto Dealers
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Article rating : 0.00, 0 votes. Author : Michael Russell
Finance. Pretty broad term. If you look up the word finance in the dictionary you will find the following definitions.
Noun
1. The science of the management of money and other assets. 2. The management of money, banking, investments, and credit. 3. finances Monetary resources; funds, especially those of a government or corporate body. 4. The supplying of funds or capital.
Verb
1. To provide or raise the funds or capital for: financed a new car. 2. To supply funds to: financing a daughter through law school. 3. To furnish credit to.
Certainly more than enough material to cover. An associate of mine in the early years of his career after graduating college with a finance degree spent a good number of years in this field. He certainly has a wealth of knowledge to share on a variety of financial topics. So in this first of a 3 part series he is going to enlighten you on the verb side of this equation. More specifically definition number 1. To provide or raise the funds or capital for. Like financing that brand new car of yours. He offers this observation and advice.
Financing anything can be a costly proposition especially if you don't know what you're doing. This is especially prevalent in one area especially, financing a new car.
Rather than bore you with a lot of information that you don't need I am going to provide you with what information you DO need so that when going to finance that brand new luxury sedan it doesn't end up costing you a fortune.
1. The first thing you have to do is determine your financial situation. How much can you afford to pay each month? Financing a car is a long term proposition. Most new car loans run for about 60 months, or 5 years. That's 5 years of your life that you need to be prepared to meet a financial obligation or your car ends up repossessed So don't finance a payment that is more than what you can afford each month.
2. Decide what car you want and what you'd be willing to accept. Maybe you want that new Lexus but at $1200 a month financing it's just way beyond your means. Maybe that $500 a month Chrysler is more in your pocket book range. Sometimes we have to settle for what we can afford. Remember, a car is a means of transportation. You spend less time in your car than in your place of employment or your home. Maybe you just want to get something that will get you to where you want to go.
3. Do your homework. There are a boat load of car dealerships out there. Don't just settle for the first one you see. Shop around. Compare prices of competing dealers. Many times if you bring an ad in from a dealer that is offering the car you want for less money you can get an even better deal from the second dealership. Don't worry. Everybody does it.
4. Don't settle for the rate the dealer gives you when financing your car. Ask him what the buy rate is from the finance company. If you think that rate is too high tell him you want him to try another finance company. If you're still not happy with the rate then try your local bank. Many times you can get a better rate just by looking around.
5. Don't let the dealer load you up with things you don't need like a tow package, undercoating, rust proofing and a lot of other junk. This will just add to the price of the car and the amount being financed.
6. Put down as much as you can afford. This will lower the amount financed and therefore lower your monthly payments.
If you follow these simple 6 steps you will find that you end up leaving the dealership with a monthly payment you can live with.
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Michael Russell
Your Independent guide to Finance
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