How to Buy a Car from a Dealership: Learn the Tips for Getting the Best Deal

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How to Buy a Car from a Dealership: Learn the Tips for Getting the Best Deal

Posted on November 18, 2024

Looking for a new car? Our team is here to teach you how to properly budget, research, negotiate, and finalize your car purchase smoothly. We've compiled a comprehensive guide on how to buy a car from a dealership to ensure that your next car buying experience with us is as stress-free as possible.

Key Takeaways

• Set a budget using the 20/4/10 rule to manage expenses and avoid financial strain.
• Research vehicles thoroughly and inspect them in person before buying to assess condition and features.
• Schedule a test drive on varied terrain to get a better understanding of a vehicle's performance under different circumstances.
• Request a vehicle history report to investigate any previous accidents, issues, and past owners.
• Negotiate effectively by focusing on the overall price, and don’t shy away from walking away if the deal isn’t right.
• Make sure your vehicle is properly insured and registered before taking it on the road.

Determine Your Budget and Financing Options

 

The journey to buying a car begins with setting a realistic budget. Applying the 20/4/10 rule is a smart approach: make a 20% down payment, opt for a 4-year loan, and keep your total monthly payment vehicle expenses under 10% of your gross income. This ensures you’re not overextending yourself financially and can comfortably manage your car payments.

 

Consider all costs associated with a vehicle purchase, including upfront costs, repair costs, ongoing expenses, dealer fees, fuel economy, insurance, maintenance costs, and other costs. A larger down payment can lead to significantly lower monthly payments and even improve your loan terms. Getting pre-approved for a loan helps you understand your financing options better. This gives you a clear budget and helps you find the best price for your budget.

 

Shorter loan terms often come with lower interest rates and allow you to build equity quicker. Interest rates, loan amounts, terms, and credit score requirements are important factors. They will all influence which auto loan is the best fit for you. Your credit score can help determine if you need a co-signer or a larger down payment to qualify for a loan.

 

Check Your Credit Score

Understanding your credit score is vital before applying for a car loan. In Canada, credit scores range from 300 to 900, with scores above 660 generally considered good. Lenders use your credit score to predict your risk and likelihood of repayment. A higher credit score can lead to better car loan terms and lower interest rates.

 

You can access your credit report for free at least once every 12 months from your bank, or use our free pre-approval form. Don't worry if your credit score is lower than desired. We provide car financing no matter what's your credit score, because we believe that everyone has a right to own a reliable vehicle. Alternatively, having a cash down payment can help with loan approval and lower the payments.

 

Research Vehicles and Features

After setting your budget, start researching vehicles. Start by considering your specific needs such as family size, driving habits, and preferred features. Utilize online resources like the Edmunds app or our online inventory of new vehicles to gather detailed information about different vehicle options and their reliability ratings.

 

It's important to see your potential choices in person, so don’t just rely on car online research. This allows you to assess their condition and features firsthand. Prepare for your car dealership visit by listing your vehicle preferences and researching average car prices in your area. Tools like the CAA Driving Costs Calculator can also help you understand the full cost of vehicle ownership beyond just the purchase price.

 

Remember that the type of car, whether pre-owned or brand-new, will also impact your decision. Each type has its own set of advantages and considerations, so weigh your options carefully.

 

Choose the Right Dealership

The next step is to find a car dealer that aligns with your chosen preferences. Outside of providing an extensive selection that aligns with your car interests, it's also important to seek out an established dealership known for its high-quality customer service. That's why our dealership has strived to ensure that all our customers leave satisfied.

 

If you're looking for a wholly transparent process and a smooth, enjoyable buying experience from your car dealer, look no further than Airdrie Dodge. Unlike some other car dealers, we won't surprise you with unexpected fees or high additional charges on advertising or market adjustments.

 

Schedule Test Drives

Now that you’ve narrowed down your choices, it’s time to schedule test drives. Test driving is crucial as it lets you experience the vehicle’s performance and comfort firsthand. Create a list of essential features you want in a car before going for a test drive. This will help you evaluate if the vehicle meets your needs.

 

To get a comprehensive understanding of your potential car's performance, our dealership offers a varied drive route that covers a range of driving conditions, including different terrains and speeds. Bringing a friend who can also help identify concerns for this test drive is good idea, as they can take note of any issues that might arise from a passenger's perspective.

 

Inspect Vehicle History and Condition

Remember to thoroughly inspect the vehicle's history and condition, especially for used cars, before finalizing your decision. All dealerships in Canada are required to provide CARFAX reports that cover any accidents, maintenance records, and previous ownership information, which we will happily give for every vehicle you might be interested in.

 

Negotiate the Purchase Price

With all the information at hand, you can now negotiate the purchase price. Whether you're buying a used car or a new one, being well-informed about vehicle pricing and market conditions will be key in helping you find the best car at the best price for your specific needs and budget. Timing your purchase based on any dealership specials and promotions can also increase your chances of securing a better deal.

 

Avoid focusing solely on monthly payments during negotiations, as this can obscure the vehicle’s total cost. Our team of sales advisors will help you understand the overall purchase price and know which aspects of the deal are negotiable, like the vehicle price and trade-in value.

 

Don't feel pressured to accept any terms that you aren't satisfied with. Our team at Airdrie Dodge is here to work with you to figure out a payment plan that works best.

 

Review Financing and Warranty Options

Once you agree on the price, review your financing and warranty options. Speak with one of our dealership’s finance managers, who can provide information about various products and services, including warranties and maintenance plans.

 

Finalize the Paperwork

After sorting out financing and warranties, the next step is finalizing the paperwork. Read all contracts carefully to ensure all negotiated terms are documented, including all relevant dealer fees and the cost of the battery heater (very important for those Alberta winters). Make sure you have the necessary items like your driver’s license, current insurance card, and any documents related to a trade-in.

 

When your new car is ready to be delivered, one of our specialists will reach out to verify your identity and assist with the paperwork. After signing the documents, you can proceed to make the payment for your new vehicle.

 

Get Behind the Wheel of Your New Car

Finally, it’s time to take the keys to your brand new car! Before driving off, though, make sure to inspect the vehicle for dents, scratches, or cleanliness issues, and ensure the gas tank is full. One of our sales team will also demonstrate key features, such as pairing your smartphone and using safety devices.

 

Both parties should keep a copy of the signed Bill of Sale for their records and ensure proper insurance coverage is secured beforehand. Inspect the vehicle again for any new damage if it arrives later.

 

Insure Your New Purchase

As previously noted, before you hit the road, it's important to ensure that your vehicle is properly insured. You should also consider investing in gap insurance (also known as guaranteed auto protection) for new cars as it covers the difference between the loan amount owed and the car’s actual cash value if it is totaled or stolen. Due to the rapid depreciation of new cars, this type of insurance can provide financial reassurance by covering remaining loan balances.

 

Dealerships typically offer gap insurance as a one-time premium that can be included in the loan amount. Consulting with an Alberta-based insurance advisor for coverage options is advisable.

 

Register Your Vehicle

Registering your new car is the final step in the car buying process. Proof of insurance, identification, and a bill of sale are needed to complete this process. Many dealerships, including ours, will work with you through the registration process, including providing you with a number plate and grouping in the registration fee with the total vehicle purchase cost.

 

For any readers new to the province, it's important to note that new Alberta residents must change their vehicle registration within 90 days, and any outstanding fines might impede this process. In addition, cars from out province require an inspection - which you can schedule with us - and existing license plates can be used on a newly purchased vehicle for up to 14 days while waiting for the registration to process.

 

Summary

In conclusion, buying a new car from our dealership involves several steps that, when followed carefully, can lead to a successful purchase. From determining your budget and researching vehicles to checking your credit score, and negotiating the purchase price, each step plays a key role in ensuring you get the best deal.

 

By following this guide, you’ll be well-prepared to navigate the car buying process with confidence. Keep these tips in mind as you look through our wide selection of new and pre-owned automobiles. Remember, a well-informed buyer is a powerful buyer. Happy car shopping!

 

Frequently Asked Questions

 

What are the advantages of buying from a dealership instead of a private seller?

Unlike buying from a private seller, buying from professional car dealers like us allows you to look through multiple vehicle options at once, as well as taking them on test drives dedicated to showcasing their performance under varying conditions.

 

In addition, the process is fully transparent both during and after the sale, meaning you won't have to worry about any unforeseen costs or scams that might come with private sales. Finally, buying from Airdrie Dodge gives you access to our full range of services, including our maintenance department, tire storage, and parts centre.

 

When is the best time of year to buy a car?

December is usually the best time to buy a car from a dealership, as you'll be able to take advantage of end-of-year sales and more competitive pricing.

 

What is the best mileage for a used car?

There's no definitive rule for how many miles on a used car is too much, but following the guideline of 12,000 miles per year is a good starting point. Determine the car's age, multiply the number of years by 12,000, and if the odometer reading is significantly higher, it might be cause for concern.

 

What is the best length of time to finance a car?

Generally, auto loans should not exceed 60 months for new cars and 36 months for used cars. However, given today's high car prices, this can be challenging for some buyers. Ultimately, selecting the optimal auto loan term involves balancing cost, affordability, and your individual requirements.