Buying a car can be an exciting yet daunting experience. With so many options available, it is hard to know where to start. Check out these tips and strategies to help you navigate the process of financing and negotiating when it comes to buying a car.
Know your credit score. Your credit score is an important factor in determining the interest rate you will be offered. Check your credit score before applying for a loan and take steps to improve it if necessary.
Research terms. Auto loans include various terms that affect the loan’s length, interest rate and down payment. Once you’ve been pre-approved, visit our vehicle loans webpage to view current terms to see which would be the best fit.
Get pre-approved. Before shopping for a car, get pre-approved for a vehicle loan from TFCU. This will give you a clear idea of how much you can afford to spend and the interest rate you will be offered.
Consider a trade-in. If you have a vehicle to trade in, consider using it as a down payment on your new car or truck. Know the fair market value of the vehicle you are trading in and negotiate for a fair trade. This can lower the amount you need to finance and result in lower monthly payments.
Now that you know the process to finance your new vehicle, it’s time to think about the negotiation process.
Do your research. Research the fair market value of the vehicle you’re interested in. Look up the make, model, year and trim level to get an idea of what the car is worth.
Focus on the total price point. Negotiate the total price of the car, including any fees and charges, rather than just the monthly payment.
Be confident. Be assertive and confident when negotiating. Finance the deal at your level of affordability.
Use leverage. Use any leverage you may have to your advantage, such as a trade-in or pre-approved financing.
Article by Kara Robinson, TFCU Financial Educator
About the author
Kara Robinson started with Tinker Federal Credit Union as a teller and earned a coveted leadership development role within the credit union that lead her to the position of Financial Educator. Kara enjoys helping others and has a passion for financial education. Learn more about TFCU’s Financial Education team here.