You'd better pump the brakes before rushing to buy a brand new car. It's easy to let adrenaline sweep you away, but doing so leaves room for problems down the road. When you're out shopping for your new set of wheels, ask these four simple questions before you commit.
1. Are there hidden fees?
According to U.S. News and World Report, there are ostensible fees that accompany a new car purchase. If you're not aware of them until you've already struck up a deal, you might end up paying hand over fist for what seemed like a great bargain at the time.
"You can always file for an extended warranty toward the end of your loan."
When you finance with the dealer, he or she might try to get you with add-ons like credit insurance, anti-theft devices and extended warranties, the source warned. However, you shouldn't feel obligated to give into these offers. In fact, Michael Caudill, auto expert and owner of a California-based public relations firm, swears that you never need to purchase the extended warranty out of the gate. You can always file for an extended warranty toward the end of your loan.
2. How does the price compare to other models?
There's nothing wrong with shopping around. You wouldn't grab a sweater off the hanger at a boutique without comparing prices and quality with other shirts, so don't jump at the chance to buy a car when you have seemingly endless options.
If you can find something that suits all of your needs and is a few thousand dollars cheaper, go for it! You'll have more money to spend on fun car accessories or even square away for your quintessential maintenance services like a tire rotation, oil change and car inspection.
3. Does it meet your needs?
Edmunds proposed a series of questions that fall under the umbrella category of meeting your needs. Ask yourself a few of them before you spring into a decision. Do you drive in the snow? How often do you turn on the air conditioner? What's the terrain like on your drive to work? There's a difference between side streets, highways and a few bumpy back roads.
If you're planning on starting a family, it's best to buy a bigger car.
Also take some time to consider the future. For example, if you plan to have kids in the next year or two, it's in your best interest to spring for a larger model as opposed to that compact sports car you've had your eye on. If you own a trailer or do any towing of the sort, this should also be on your radar when you're picking out a new mode of transportation.
4. Can you trade in your old car?
CNN Money pointed out that your current vehicle may be pivotal when it comes to buying a new car, as its worth could determine your price point. Do your research prior to trading in your old car so you receive top dollar for it. Sometimes selling it directly yields a better return than a trade-in.