A practical guide to buying a car

Introduction

Buying a car is a big decision, and a solid plan can save time and money. This guide lays out the main steps to buy a car confidently, whether you choose a brand-new model, a certified pre-owned option, or something in between.

New vs used

Choosing between a new and a used car affects price, depreciation, warranty coverage, and maintenance. New cars come with the latest features and a full warranty but lose value quickly. Used cars cost less upfront but may need more maintenance and could have hidden problems. Balance your budget, risk tolerance, and the features you need.

Budget and financing

Start with a realistic total budget that covers the price plus taxes, fees, insurance, and ongoing ownership costs. Decide how much you can pay upfront and whether you will finance or lease. Shop for loans from banks, credit unions, and the dealer, and compare interest rates and terms.

Car hunting steps

• Make a must-have list of features (safety tech, fuel economy, seating).
• Research models that fit your needs and read consumer reviews.
• Check local listings, certified pre-owned options, and demo vehicles.
• Compare prices across dealers and be mindful of add-ons.

Inspecting a used car

Do a thorough exterior and interior check, and look for signs of wear, rust, or prior damage. Check tires, brakes, lights, and under the hood. Run a vehicle history report using the VIN and consider a trusted mechanic inspection if possible.

Test drive and evaluation

Test essential functions: braking, acceleration, steering, suspension, transmission behavior, and comfort. Listen for unusual noises and note how easy it is to use controls.

Negotiating price

Know the fair market value for the model and condition. Start with a reasonable offer, stay respectful, and be prepared to walk away. Timing can help, such as end-of-month or model-year changeovers.

Financing and insurance basics

If financing, compare loan terms and total cost of the loan, not just the monthly payment. Get insurance quotes before buying to avoid surprises, and understand required coverage.

Ownership costs and warranties

Plan for fuel, maintenance, tires, registration, and potential repairs. Understand warranty coverage on new or certified pre-owned vehicles and consider an extended warranty if it fits your risk profile.

Checklist for your purchase

• Confirm the price and written quote.
• Verify the VIN, title, and history report.
• Arrange a mechanics inspection for used cars.
• Review all documents carefully before signing.