FREE
Car Buying Guide

How to Buy a Car in
10 Simple Steps

With over a decades worth of experience and thousands upon thousands of car deals under my belt, I will show you what it takes to buy a car with no headaches and massive savings!

My experience in the car business has shown me what steps to buying a car...

• Have worked for customers
• Have not worked for customers
• Have worked for car dealers and...
• Have not worked for car dealers

My goal here is to share my experience with you so that you can learn how to buy a car while avoiding the pitfalls and learn the right steps to buying a car for maximum time, money and stress savings.

Now 3 Versions!

The most popular version will save you time, but is still jam packed with extremely valuable car buying information. No need to do anything just scroll down to start learning or you can skip to it here: Learn to Buy Like a Pro! (About 12-18 minutes)

For the most in depth and comprehensive car buying guide online start here: Steps to Buying a Car. (About 30-45 minutes)

Or, the "I want my information fast" condensed version, which cuts some corners and doesn't quite teach all the information I feel is so crucial, but still a good quick guide to buying a car: How to Buy a Car. (About 5-7 minutes)

Table of Contents

• Before You Go
  • Your Credit
  • Pre-Approved Loans
  • Know Insurance Costs

• Get Ready to Go
  • Budget & Shop
  • Figure Trade In Value
  • Figure the Dealers New & Used Cost

• Once You Are There
  • How to Inspect Used Cars
  • Successful Four Square Negotiating
  • FedEx It! Make it an Overnight Delivery (Important!!!)
  • Avoid Scams in the Finance Office

• Take Delivery (Bonus Section)
  • We Owes / Due Bills
  • Buyers Remorse

No matter what your level of "expertise," I'd recommend reading about the 7 types of car buyer as this will help you to establish a solid understanding of the car buying game - who wins, who loses and why. Never underestimate a car salesman!

This new and used car buying guide works for both buying and leasing, but leasing does require you to learn a slightly new language. Take a look at my new car leasing guide to learn to talk the talk.

Before you start your search for your new car there are some extremely important steps you must take. These steps will set the foundation for either a good experience or a not so good one!

1. Know Your Credit

If you will be financing your next new or used car, then you'll need to learn how to buy a car on credit. Are you "Aces"...Are you sure? Have you seen your credit lately, if ever?

It's very important to know what's on your credit report and what your credit score is. If the dealer knows more about your credit than you do...You Lose!

Of course, if you are paying cash for your next vehicle, then this step of the car buying guide can be skipped.

However, if you are financing you must know how you will look to a lender and what credit tier you will fall into.

I've seen it many, many times where a customer thinks they have a 750 credit score and that they'll qualify for top tier interest rates, but numerous factors, such as:

• Small collections (medical is the most common)
• High balances on credit cards (balances over 35% of the limit hurt)
• Incorrect information reporting (very common for a Jr./Sr. and people with very common names)

cause unforeseen problems.

The difference between A+ tier finance rates and let's say a B tier can be 5% or more. A 5% difference on a $20,000 loan at 72 months equals over $3,500 in additional finance charges. What if that 5% was 8% or even higher?

Check your credit and score, settle small collections, pay down credit cards and dispute inaccurate information. You'll save a ton of dough in the long run. You can Check your Credit Score - Fast, Free & Easy at CreditReport.com.

2. Get Pre-Approved for an Auto Loan

In your next step of the car buying guide you'll want to arrange your own financing and get pre-approved for an auto loan. Of course, you could let the dealer arrange this for you, but you'd probably change your mind after reading about car dealer finance profits and how much they make arranging loans.

Outside of the profits the dealer makes from arranging financing, having a blank check in your hand from your own source allows you to buy like a cash buyer. It simplifies the negotiation process and helps you focus on the only number that really matters, the sales price.

Not too long ago I had compared 40 cash deals to 40 finance deals and found that on average cash buyers paid over $2,000 less.

Moral of this Story

You will save money Buying Like a Cash Buyer! MyAutoLoan.com offers extremely competitive rates (currently as low as 2.49%) and gets you quotes from up to four lenders. Very easy!

They offer loans for both new cars and used cars, so get approved now - "Auto Loan Application" - to see what low rate you'll qualify for.

If your credit is not the best, then you'll want to take a look at my Bad Credit Car Buying Guide to find tips and loan sources specifically for bad credit car buyers.

3. Know Insurance Costs

In the third step of the car buying guide, let's take a look at the three most common types of "insurance" and what to watch for.

Auto Insurance

Imagine that you've found your dream car and wanted it so bad that you were willing to pay $75 more a month than you had originally budgeted for. It will strap you a little bit each month, but for this car it is worth the sacrifice.

Only problem is that you didn't check auto insurance rates until the day after you signed that very legally binding 5, 6 or even 7 year contract. Not only are your monthly payments higher than you can comfortably afford, but now your insurance is jumping up another $65 a month. Ouch!

80% of the dealerships that I've worked for had very strict no return policies and unfortunately for these customers, they were stuck!

Don't get stuck, especially with something as easy as getting insurance quotes. It should always be free to get quotes, it doesn't affect your credit and is typically very fast. Get Your Free Auto Insurance Quote from Esurance

Vehicle Extended Warranties

Buying an extended warranty can be an excellent idea to pay for any future mechanical issues your car may encounter, but you will definitely want to do your homework ahead of time. There are lots of "fly by night" companies that would be happy to take your money and run!

In addition, car dealers can make rather hefty profits selling extended warranties and I'd suggest you get some quotes online to be sure the dealer is not out of line with their pricing.

Be sure to read the warranty contract very closely! Extended warranties are often confusing and some deceptive finance managers will sell inferior coverage as top of the line just to put a few more bucks in their pocket. Take a look at these 12 very important questions to ask about your Vehicle Extended Warranty.

I'll cover warranty scams more when we get to the 10th step of the car buying guide.

GAP Insurance

If you will be financing your vehicle and not using at least a 25% down payment, then you definitely want to learn the benefits of GAP insurance.

In a nut shell, GAP insurance will settle the difference between your insurance companies payment and what is actually owed to the lender in the event your vehicle is totaled out in an accident or stolen and not recovered. This can equal thousands of dollars that you'd have to pay without this coverage.

If you are not familiar with GAP insurance and are planning to finance please do yourself a favor and learn more about GAP Insurance once you are done reading the car buying guide.

Top

We're Just Getting Warmed Up!

Now let's move on to the fun part of the car buying guide and start shopping. Before we do that, I'll show you how to set a comfortable budget and how to save hundreds if not thousands of dollars with ease. We'll also talk about your current cars trade in value and how to figure the car dealers new and used car cost.

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