How to buy your first car Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make better financial decisions by offering interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct your own research and compare information at no cost - so that you can make informed financial decisions. Bankrate has partnerships with issuers such as, but not limited to American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The deals that are displayed on this site are from companies that pay us. This compensation can affect the way and when products are featured on this website, for example, for example, the order in which they be listed within the categories of listing and other categories, unless prohibited by law. Our mortgage home equity, mortgage and other home lending products. This compensation, however, does not influence the information we provide, or the reviews that you read on this site. We do not include the vast array of companies or financial offers that may be available to you. FG Trade/Getty Images
4 min read published March 02, 2023.
Written by Rebecca Betterton Written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in helping readers in navigating the details of borrowing money to purchase an automobile. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are enthusiastic about helping readers gain confidence to manage their finances by providing concise, well-studied information that dissects complicated issues into digestible chunks. The Bankrate promise
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At Bankrate we aim to help you make smarter financial decisions. While we adhere to strict editorial integrity ,
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Established in 1976, Bankrate has a long history of helping people make informed financial decisions.
We've earned this name for more than 40 years by simplifying the process of financial decision-making
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So you can be sure you can trust us to put your needs first. All of our content was written in the hands of and edited by ,
They ensure that what we write will ensure that our content is reliable, honest and reliable. We have loans reporter and editor are focused on the points consumers care about the most -- the various types of loans available, the best rates, the best lenders, how to pay off debt and more -- so you can feel confident when investing your money. Editorial integrity
Bankrate has a strict policy , so you can trust that we put your interests first. Our award-winning editors and journalists produce honest and reliable information to assist you in making the right financial choices. The key principles We appreciate your trust. Our aim is to provide our readers with accurate and unbiased information. We have editorial standards in place to ensure this happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you're reading is correct. We keep a barrier between our advertisers and our editorial team. Our editorial team doesn't receive compensation directly from our advertisers. Editorial Independence Bankrate's team of editors writes for YOU the reader. Our aim is to offer you the best advice to aid you in making informed financial decisions for your personal finances. We adhere to strict guidelines in order to ensure that our editorial content is not in any way influenced by advertising. Our editorial staff receives no direct compensation from advertisers, and our content is fact-checked to ensure accuracy. So whether you're reading an article or a review you can be sure that you're receiving reliable and reliable information. How we make money
You have money questions. Bankrate has the answers. Our experts have been helping you manage your money for over four years. We are constantly striving to give our customers the right advice and tools required to succeed throughout life's financial journey. Bankrate follows a strict standard of conduct, so you can rest assured that our content is honest and precise. Our award-winning editors and reporters produce honest and reliable information to assist you in making the right financial choices. The content we create by our editorial team is factual, objective and uninfluenced by our advertisers. We're transparent about how we are capable of bringing high-quality content, competitive rates and helpful tools to you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We receive compensation for the placement of sponsored products and services or when you click on certain links posted on our website. So, this compensation can influence the manner, place and when the items appear in listing categories, unless prohibited by law for our mortgage, home equity and other products for home loans. Other factors, such as our own rules for our website and whether or not a product is offered in your region or within your self-selected credit score range could also affect the way and place products are listed on this site. Although we try to offer a wide range offers, Bankrate does not include details about every credit or financial products or services. The monthly average amount for a used car was $526 in the fourth quarter of 2022 and new cars were sitting higher at $716, according to . For a new buyer, numbers this steep can be daunting and more daunting when you're not experienced with the process. But confidence is all about preparation, so take time prior to going to the internet or a dealership to know the essential steps to take when buying your first vehicle. 1. Determine how much you can afford The key to buying a car that is successful is to first determine . The credit rating, monthly income, and the kind of car you'd like to purchase should all factor into this decision. It is important to strike a balance between your budget and choosing the right car for your needs. When you budget, take a look at the total, not only the sticker price that you will see advertised. The actual price for the car is the entire cost that you'll have to pay, which includes tax and dealer charges. When you've got that number or a reasonable estimate, take into account your typical salary and make use of a , which will assist you in determining what the monthly cost of financing the car will be. The bankrate tip
Car ownership has its own costs, so be sure you have room in your budget to cover additional costs.
2. Make a savings account for a downpayment The for your future vehicle is the initial lump sum you will pay. Try to pay at least 20% of the cost of purchase, which might take some time. Being patient and saving up to purchase a car is probably worthwhile if you can put off purchasing the car until you have the funds. This will help you save cash in the end and decrease the monthly cost. If you're not able to be patient, you can opt for an easier down payment. But, you might not get a good rate from your lender. In this case, consider the option of a cheaper vehicle. The lower the price overall, the less you will need to save for a down payment. 3. Examine your credit history If this is your first large financial investment, it is likely to be that you do not have a lengthy credit history. If that's the case, check your credit history to find out which loan options are available. The credit score of yours is the main element that lenders look at when determining the interest rates that you will be offered. The better your credit is, the better your interest rate will be. Check your credit score before making contact with a potential dealer. You can do it online through or for free at . It is worth waiting to ensure your credit is in good shape before applying for vehicle financing If you are able to. 4. Find the best car for you. Deciding which car is best for you takes a lot more consideration than just style or color. Also, consider other aspects such as the vehicle's durability and size to meet your needs, technology and safety features, as well as gas mileage and the climate in which you reside. Check out and for these statistics and additional details about how much the car you're interested in is sold for. It is also a good time to consider whether you'd like to purchase an . Although a brand-new car is thrilling, certified pre-owned (CPO) can give you a lower price tag but still come with the latest features, as well as manufacturer-backed warranty. If you're not in a hurry to drive whenever you can You can save money by waiting . 5. Prequalify for financing After you gather some information on the kind of car you'd like to purchase as well as your financial situation, you can look for lenders that provide prequalification. This is crucial to saving money and putting you in charge when it comes to selecting the most suitable financing option. Prequalification, or , differs from full approval, and so even after the prequalification procedure closes, it's still not a complete agreement. Preapproval is a good way to give you an idea of the potential rates and conditions. It is still necessary to fill out an application form the preapproval, but you'll be able to determine of whether you're able to pay for the application prior to. The following information is required when you apply to prequalify the program: Average income and financial information. Personal information. Employment information. Any current debt. 6. Go to the dealershipeither in person or on the internet. After prequalifying for an loan and setting your sights on the vehicle of your dreams now is the time to start the purchasing process. Ideally, you should look up the types of cars available in your region. Most dealers list their inventory on their websites. They also permit you to schedule appointments. It is important to get behind the steering wheel of your prospective car and take it on an initial test drive prior to making a buy. Be sure to alter the seat and see if it fits into your garage and is able to handle your day-to-day routine. However, you're not restricted to dealers that are local to you. Online dealers such as Carvana, TrueCar and Vroom give you access to the entire inventory of used cars. You can look through and obtain financing from the comfort of your home If you decide to purchase the car you want, you can get up to one week to drive your car and have it . 7. Negotiate Negotiation can feel intimidating but getting the best deal is in the form of being a strong advocate for yourself. Be prepared with all the paperwork required, a clear knowledge of your credit score and to ask. But the most important thing to remember is this: be prepared to quit if you are unable to obtain the credit you are due. If the time is right to close the deal be firm on the agreed-upon number. It is possible for the dealer to insist on . Don't accept options such as paint protection or fabric when an add-on like gap insurance may be more beneficial. Next steps in negotiation can be difficult But getting the best deal boils down to being a strong advocate for yourself. Bring any documents needed, a firm understanding of your credit history and ask questions. Be focused on the purchase price and not on the monthly installment. Also, be ready to leave if you don't get the deal that you deserve. When the time has come to close the deal be firm on the agreed-upon number. You can expect the dealer to press for . Don't be averse to options such as fabric or paint protection while an extra option such as gap insurance may be more beneficial. Find out more
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Written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She has a specialization in helping readers in navigating the ways and pitfalls of taking out loans to purchase an automobile. Edited by Rhys Subitch Edited by Auto loans editor Rhys has been writing and editing for Bankrate from late 2021. They are committed to helping readers gain the confidence to manage their finances by providing precise, well-researched and well-researched facts that break down complicated topics into digestible pieces.
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