Buying a new car, especially your first, is always an exciting experience. After all, it’s the start of a journey that will no doubt bring you numerous memories over time. However, the process can be clouded with conflicting input from various sources, not to mention the arduous task of finding that perfect car, yet alone negotiating it down to a fair price. But if there is something to be concerned about, it’s these three new car buying myths.
Negotiating the sticker price down gives you the best outcome
While a lower sticker price is nothing to sneeze at, it shouldn’t be the sole focus of your efforts to secure the best outcome. The price may have been inflated to begin with, thus making it look like you’re scoring a bargain from your negotiating efforts, or there may be additional costs elsewhere. Some of these extra expenses include the cost of finance, which a dealer may even require you to take out through them in order to qualify for the ‘lower’ sticker price. In some instances this finance will be subject to a higher interest rate, other fees and charges to establish the loan, or even penalty fees should you wish to repay the car loan early. Especially in recent times, with new car sales down drastically, you have more scope than ever to get the bargain that works for you, not the dealer.
0% interest free loans mean the lowest total cost
Much like the above point about not focusing exclusively on a car with the lowest sticker price, you should also look carefully into any advertised promises of 0% interest free loans. This time, the dealer may be making a premium on the sticker price of the car, which could be inflated compared to other sellers so as to help them retain their margins. If you read the fine print, you may also notice that the interest free period is for a certain time, after which you could be exposed to high costs that add up over the long-run. In either case, the total cost of the car could exceed that found elsewhere.
A dealership is your best option to find a great value deal
While dealerships offer certain protections, many motorists have found it difficult to deal with pushy salespeople and ultimately don’t come away with a bargain. Instead, consider the second hand market for an alternative option, or even ex-demonstrator models that have low kilometres recorded. You may have to do extra research, or arrange for greater scrutiny of the vehicle, but you can really pick up a large discount at times, especially when a seller gets anxious to clear the vehicle. That said, one of the emerging themes in 2019 was a reduction in the number of ex-demo cars available, so be quick if you find one! Also, don’t fall for the myth that a rainy day will help you score a bargain from a ‘desperate’ dealer. Your best bet is at the end of the month, around Christmas, or at the end of the financial year. These periods are tried and tested for scoring a bargain.
The Fincar team is here to help you with all your financing needs. Contact us today to help arrange your next car or equipment loan.