Okotoks Honda Top Tips For Buying The Right Car In 2012

If you are thinking about buying a car in 2012, now is the time to do some planning, so you’ll be fully prepared when it comes time to make your purchase. Whether you end up buying a new or used car, chances are it will be the second most expensive item you own next to your home, so it makes financial sense to avoid any snap decisions. Here are 12 tips to ensure you buy an affordable car.

1. Determine your budget

Determining what you can afford, not just for the car itself but for all ownership costs, is important before you settle on a certain make or model. Though spending no more than 20 percent of your monthly household income on all the cars in your household is a general rule of thumb, you may be able to afford more or less. Bankrate’s home budget calculator will help you calculate how much you can afford to spend. Keep in mind this number should cover all costs, including monthly payments, insurance, fuel, repairs and maintenance.

2. Narrow your car choices

You’ve probably already started noticing cars that interest you. Make note of them and start researching them online at the automakers’ websites and third-party vehicle information sites. Make sure your research includes assessing all of the car’s features that are important to you as well as invoice and retail prices. Keep a file of your research, but don’t head to Okotoks Honda for a test drive just yet.

3. Decide on new or used

Don’t assume you’ll get the most bang for your buck buying a used car. Used cars are in high demand and usually more expensive than ever, while many new cars have substantial rebates and other “perks” such as rewards programs, roadside assistance and so many more.

With used cars, however, you let someone else take the initial depreciation hit, while with new cars, you have the benefit of the full factory warranty. Sometimes certified pre-owned cars offer the best of both worlds: a car that’s already experienced the bulk of its depreciation yet has a longer warranty.

5. Check cost of ownership

To determine if the cars on your short list are within your budget, check the ownership costs for each car. This information is available at many third-party vehicle information sites. But keep in mind the ownership costs on these sites are averages. Your actual costs, especially for fuel and insurance, may vary greatly.

Call your insurance agent to get a quote for the cars using your current coverage as a gauge, and do the math on your fuel costs based on the average price of gas in your area and the typical number of miles you drive.

5. Check the car’s history

Every car has a history, and you should know it. For new and used cars, check the model’s reliability ratings to get an idea of how much you’ll spend on repairs as well as how often you may find yourself bringing those cars in for service. For used cars, run a CarProof report using the car’s vehicle identification number, or VIN, to see if the car has any red flags, such as a serious accident, a lemon buyback or flood damage.

6. Shop around for a lender

Don’t wait until you are in Okotoks Honda to determine initial financing. Use Bank of Canada to see current interest rates nationwide. Also, check with local lenders, including credit unions, which are often 1 percent to 2 percent less than conventional banks. Remember, that as third-party lenders and convential banks use fixed and variable rates, collateral on these loans are high. Sticking with Okotoks Honda Financing, you fixed rates are always guaranteed.

There are now many available financing options to anyone living in their area, eliminating the need to work at a certain company to join. With credit loosening, blank-check auto loans — or prearranged financing — are being offered more widely, and they allow you to negotiate without wondering about your interest rate.

7. Highly consider financing at the dealership

Although Okotoks Honda focuses on helping you find the right car at the right price, we also have years of experience with auto financing. Our relationships with Honda Canada and other banks are extensive, allowing for an easier transition for approvals and financing. That is why you will always get clear and informed quotes from Okotoks Honda.

8. Weigh cash-back rebates versus low-interest loans

The low-interest loans offered by manufacturers are designed to entice clients looking for affordable payments, but actually, the toss-up happens between the low rate and the high incentive.  When you do qualify though, a low-interest loans may not be the best choice for you and your financing since you would be giving up a high cash rebate which offsets the cost of borrowing with interest rates. Determine the best interest rate you qualify for and then use Honda Canada’s car rebate vs. low-interest calculator to determine the best deal.

9. Research all rebates, incentives and discounts

Manufacturer websites will list all of the current cash-back rebates so make note of those before you visit Okotoks Honda. Also use third-party vehicle information sites to research dealers’ incentives. While 95% of the time, cash incentives are from the manufacturer, Okotoks Honda sometimes have in-house rebates to assist with trade values, price reductions or accessories - but you have to ask for it.

10. For the best deal, start negotiating from the invoice price

Once you’ve decided on the car you want, you have options to visit third-party vehicle information sites and spec out the exact car you want including model year, trim level, engine, transmission and any options. It is always to be completely informed before making a decision. Print out the pricing page and utilize these tools in your discussions and pricing - allowing for fair profit margins for the dealer and best deals for you. Once you’ve negotiated the price, ensure that all cash-back rebates, personal discounts and dealers’ incentives are transparent and disclosed.

11. Factor in your trade-in car

Check all third-party vehicle information sites to determine what your car is worth on a trade. Understand that the values you find are based on wholesale pricing vs. retail pricing on AutoTrader.ca.  Discussions take place when determining the price of the trade in relation to the vehicle you are buying.  Never deal exclusively on both. Utilize trade values and vehicle pricing to get the best deal as possible. At Okotoks Honda, they have many tools and resources to ensure the pricing is fair to you and to the dealership.

12. Take a thorough test drive

While other dealers may expect you to make your decision on a 15-minute test drive, you should take all the time you need. Be sure your test drive allows you to drive a short distance on city streets and get up to speed on a highway. Also, try pulling into and out of a parking space. Let Okotoks Honda allow you to take all the time you need to make your decision. If need be, 24 – 48 hour test drives are available.

If you need to carry certain cargo or install car seats, bring those items along to the dealership to test their fit. Spend some time with the car parked going over the controls, seating, and mirror and pedal positions to help ensure you’ll be comfortable for the long-term.

Posted on January 21, 2012, in January 2012. Bookmark the permalink. Leave a comment.

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