Aside from buying a home, a vehicle will likely be the second biggest purchase you’ll ever make. Avoid these 10 everyday car buying mistakes to dodge any pangs of regret as your drive off in your new set of wheels.
1. Forgo research
Before you set foot on the car lot, do some research. The showroom floor isn’t the place to see what’s available for the first time. Learn what’s out there and decide if it’s a car, truck, or sports utility vehicle (SUV) you want to buy. Then, compare costs. Decide what features are must-haves and set — and stick to — a budget. Otherwise, you run the risk of buying solely on emotion.
2. Overlook the cost of auto insurance
Once you’ve done some preliminary online research and narrowed down your vehicle choices, evaluate how much you’ll spend per year on auto insurance.
Compare car insurance rates to know how much it might cost to insure each vehicle you are considering. It takes only a few minutes and could save you hundreds of dollars annually for each year of car ownership.
Related Read: Which Cars Are the Most and Least Reliable?
3. Fail to factor in the other costs of ownership
Compare each vehicle’s fuel consumption rates. Fuel use is a regular and costly expense, particularly now, as gasoline prices have hit record highs in Canada. The more fuel-efficient a vehicle is, the less fuel you will need to buy. Natural Resources Canada’s Fuel Consumption Guide provides model-specific fuel consumption information so that you can anticipate annual fuel costs.
Also, chat with a trusted mechanic. Some vehicles’ parts cost more than others, resulting in a heftier maintenance tab.
4. Buy a car on the initial visit
Use the first visit to a dealership solely as a trip to look at and test drive the car(s). Let the dealer know that you are not buying today and are simply in the research stage. Gather the information you need from your visit and collect your thoughts without sales pressures. Then move on to the next dealer on your list, and repeat.
5. Buy under pressure or in a rush
There is plenty of fish in the sea, and cars are no different. Take your time, visit several dealerships, and be ready to walk away. Otherwise, you may end up with a vehicle that you don’t like, paid too much for, or doesn’t fit your lifestyle and needs.
6. Skip out on the test drive
Most showrooms were closed for a brief period in 2020 due to the pandemic; however, that didn’t stop drivers from getting new vehicles. Virtual tours, appraisals, and home test drives allowed car buyers to shop online, with some companies even offering home delivery.
Test driving a vehicle is an integral part of the car-buying process. You can ascertain whether the car measures up to your expectations and needs during this time. Remember, you’re spending a lot of money and don’t want any after-purchase surprises. A 30- to 60-minute test drive can ensure you are comfortable with how the vehicle handles.
7. Neglect to research your trade-in
Know your car’s actual market value if you plan to trade it in. Do a quick search online to calculate the average value for your model and year. Don’t forget to look at vehicles with similar mileage, so you’ll know what to do if the dealership lowballs you on the trade-in offer. It might be worth your time to sell your car privately.
8. Focus on the payment, not the price
Car loans typically range from 36 months to 72 months, with the latter considered a long-term loan, which usually has lower regular car payments. However, the Financial Consumer Agency of Canada highlights the risks of long-term loans. Long term car loans can:
- Lead you to spend more than you can afford
- Require you to pay more interest over the life of the loan
- Result in your car being worth less than the amount you still owe on it, depending on when you want to sell the vehicle
When financing a car, focus on the total purchase price and not the smaller, more attractive loan payments. Set a realistic budget, anticipate how many years you’ll likely keep the car, compare costs, negotiate, and shop around for the best financing deal.
9. Wing the negotiations
Negotiating a fair price requires research and keeping an eye on your budget. Make sure you’re ready, in advance, to sit down and talk money with the dealer.
Here are a few tips to keep in mind:
- Ask the dealer to knock off the manufacturer incentives.
- Negotiate the price of the vehicle, not the loan payment if financing or leasing.
- Look at additional fees that accompany the purchase. Many are required (freight and handling, for example), while other costs, such as the dealership’s administration fee, can be dropped.
- Watch the extras that have a way of creeping into the sale (like floor mats). Be prepared to say no and focus exclusively on the vehicle’s price.
Finally, call your dealer if the manufacturer’s incentive increases in the days following your purchase. They may honour any promotions.
10. Let your guard down after you’ve negotiated your price
Say you’ve agreed to a price with the salesperson, and you’re happy. In this case, you’ll likely go to another individual whose role is to explain all the benefits of an extended warranty, rust protection, and chip protection. Be prepared to say no to add-ons unless you intend to purchase them anyway.
A lot goes into buying a new car. But by avoiding these common mistakes, you’ll drive off the lot happy and free from buyer’s remorse.