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Basics of car buying

How the car buying process works

Buying a car is one of the biggest and most important financial investments a person will make. Whether you're going to spend $10,000 or $30,000, it is important to ensure that the car you buy is the best fit for your pocketbook and your lifestyle.

Step 1 – Determine why you need a car
Asking yourself questions about why you need a car will help determine the kind of car you buy. Will the car be used for short commutes and in-town driving? A smaller car might be the best bet. Do you have a family you will need to transport? A minivan or other SUV is probably in order. Take an inventory of how your new car will be used so you will have a better idea of the type of car you will need.

Step 2 – Set a budget
Determine how much money you can afford to spend on a monthly payment before even thinking about shopping for a new car. There are a number of web sites available –,, – that will assist you in determining how much you can expect to pay per month on a specific amount of money borrowed.

Step 3 – Do your research
Once you determine which car you are interested in, do your research on the car to see how professionals and consumers rate it. There are many websites that cater to this. Once you have researched your desired car, search dealers in your area to determine who is offering the best deals. The price of a car isn’t the only thing to consider. Dealer incentives like rebates and extended warranties are also keys in getting the best deal.

Step 4 – Test it out and make some calls
Visit a dealer and take the car for a test drive. Driving a car can give you better insight on things that you will encounter with it every day. After you drive the car and get the dealer’s best price, make sure you shop around.

Call other dealers within a 60-mile radius, tell them you are interested in a particular car, and want to know if they can beat the price you were quoted. You will probably find a dealer who will quote you a lower price. That doesn’t mean you have to buy your car from them; you can then contact the original dealer you visited and tell them that someone else beat their price. You’re more than likely to get a lower quote.