6 Steps to Buying a Car

First Service Credit Union
8/1/2018 12:00:00 AM - 3 min. read

Buying a car can be a real thrill ride. It’s exciting to test drive the latest vehicles and imagine yourself coasting around town. However, if you overspend or choose a bad finance offer, things can quickly take a turn for the worst.

Avoid the pitfalls and follow our six-step guide to buying a car.


Step 1: Decide What Type of Car You Need

Determine what type of car you need — not just the type you want. For example, you may want a luxury, sports car that seats two people; however, you’re planning to start a family soon, so you need an affordable sedan that seats four. Also, consider your body size, commute, and lifestyle. If you’re tall, you may need a car with ample leg room; and if you have a long commute, you want to be sure your ride is comfortable and fuel efficient.


Step 2: Set a Budget

Evaluate your budget and determine how much you can afford to spend on a monthly auto loan payment. Don’t forget to include the car insurance, maintenance, and gas costs. If you can afford it, factor in a down payment to help lower your monthly payment. Certain types of vehicles, including large SUVs and luxury vehicles, can require premium gas, which costs you more money at the pump. Consider every factor of the vehicle’s cost.

Once you’ve determined your budget, use an auto loan calculator for an estimate of how much car you can afford.


Step 3: Get Pre-Approved

Before you start visiting dealerships, get pre-approved for your auto loan. This will take the guess work out of the process when it comes to price. By getting pre-approved, you will uncover exactly what price car you can afford, so you can shop with confidence. Plus, your bank or credit union may offer a better auto loan rate than the car dealer. If you choose First Service, we provide you with a blank pre-approval check that you can fill out at at the dealership and use to purchase your vehicle just like a cash buyer.


Step 4: Shop Around

You’ve decided what type of vehicle you want, determined your monthly budget, and gotten pre-approved. Now it’s time to shop around for the best deals, in person and online. Don’t buy from the first dealer that has the car you’re looking for. Visit multiple dealers and look online for the best offers.

Test drive the vehicle. If it’s used, ask for a vehicle history report to see if it’s been involved in any major accidents, and have a mechanic check it out, as well.


Step 5: Make an Offer

Now you’re ready to make an offer on the car you’ve been dreaming of. But before you do, don’t be afraid to negotiate for a lower price. Ask the dealer to lower the sticker price, even if it already fits your budget. They have room to negotiate. If you’re buying a used car, research the vehicle’s value so you know how to negotiate and don’t overpay.


Step 6: Sign and Drive

Once you’ve gotten the price you want, you’re ready for the paperwork. Before signing, be sure to carefully review the details to ensure you understand the financing terms and warranty. If the paperwork’s in good order, you’re ready to sign and drive. Happy trails!