Q: Are you buying a car or a loan? (Part 1)

The first thing you need to do when you set out to buy a car is to shop for price.  And no, I am not talking about “monthly payment.”  Never, ever, ever, ever, shop for a car on the basis of monthly payment.  Never mention monthly payment to any salesperson or finance manager.  At the outset, you need to familiarize yourself with THE CASH PRICE OF THE VEHICLE, even if you ultimately plan to finance.  There are many ways to do this without setting foot on a car lot and I recommend not setting foot on a car lot until you have educated yourself.  I cannot stress how important it is for you to understand that you are buying two things:  a car and a loan.  There is a price tag for the car and a price tag for the loan. When you start talking about monthly payments, you are not looking at the price tag for either one and, under these circumstances, the dealer will cheat you.  That is the dealer’s job; to trick you or wear you down so that you will make an ill-informed decision about the value of the vehicle and the cost of the loan.  So, first, you need to nail down the cash price of the vehicle.

Go online.  Find the car that suits you.  Start looking at various makes and models from different years, with different mileages.  Figure out what these cars are selling for in your area.  You can use many resources to determine this.  I usually go to Kelley Blue Book. But there are many other places you can look.  The point is to know the range of prices.  You will see a consistency.  If you see a vehicle priced significantly lower than most similar vehicles, it’s probably a wreck or a bait and switch.  Avoid those vehicles.

Spending an hour or so online will prove invaluable.  The goal is to find five or six cars that you like and that you can go look at, and to know the cash price range of these vehicles.  PRINT OUT THE ADS!!!! Make sure that your ads contain the VIN of each vehicle and the cash price.

Please note:  I have not discussed financing or monthly payments.  And I will not do so for a bit longer.

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