Owning your first car can be a dream come true. If you are planning to buy a car, you should be wary that you will not step into a nearby showroom and walk out with a vehicle. It is rather unfortunate that the car buying experience can be dreadful, especially if you do not know whether you got a good deal or reaped off. This is especially true when you are buying a luxury car such as the Toyota Prado. That said, here are some tips to follow when shopping for a new car.
Have a Budget
You need a budget to know the kind of vehicles that you will be looking for. Ideally, this means that you have to look at your savings and the possibility of getting some extra money through loans. It is rather unfortunate that most people overestimate how much they can afford, thus ending up with uncomfortably high loan payments.
If possible, you should pay the car in cash to avoid extra interest costs. But if you need a car loan, make sure that it does not exceed 15% of your monthly take-home, commit yourself to at most 48 months, and sink a substantial down payment (at least 20% of the purchase price)
Pay Attention to the Costs
With a budget, the next big hurdle is choosing a car. While there are many details on how to go about this, this article focuses on getting value for money. It is rather surprising that a car’s price is not always a true reflection of its cost. With depreciation accounting for a large portion of a vehicle’s worth, it is advisable to ensure that you limit yourself to vehicles that depreciate slowly, which ends up costing less in the long term. This means that an expensive model with slow depreciation is better than purchasing a cheap car that depreciates fast.
Pay Attention to Car Incentives
With high competition, vehicle manufacturers offer all manner of incentives to help sell their cars fast. In light of this, you need to pay attention to these incentives, some of which are cash back incentives. While you might automatically get the incentive from the dealer, most dealers do not offer these details. On the flip side, manufacturers who do not offer incentives tend to have slow depreciation rates. Therefore, it is all about your preferences.