7 Biggest Mistakes in Car Buying
1. Paying too much: The obvious one, right? There really are unethical sellers out there who overcharge. There are also private used car sellers who try to sell WAY OVER market value simply because they owe a bunch on the vehicle. Lots of ‘em are flipped (upside down) thousands and can’t stand the payments so they try to sell it for payoff…which may have included thousands in deficit equity from a previous trade and could be thousands over realistic market value. Do some research. Look at the source of that research and determine if they are pursuing their own agenda.
1. Paying too much: The obvious one, right? There really are unethical sellers out there who overcharge. There are also private used car sellers who try to sell WAY OVER market value simply because they owe a bunch on the vehicle. Lots of ‘em are flipped (upside down) thousands and can’t stand the payments so they try to sell it for payoff…which may have included thousands in deficit equity from a previous trade and could be thousands over realistic market value. Do some research. Look at the source of that research and determine if they are pursuing their own agenda.
2. Buying too much car: Even if you got a great deal, if the car payment is 35% of your income, you could be headed for a financial disaster that could wreck your credit and having you paying exorbitant interest rates for years (or driving a junker). Establish a budget or at least estimate your monthly expenses and seek to have transportation no more than 20-25% of your income.
3. Bad Service or No Service: No manufacturer is shipping them with the hoods welded shut. All vehicles are complex mechanical products and they all break and they all will need service. One of the reasons you want a newer car is to have some warranty, right? Warranty doesn’t determine whether you will get good service…just who pays for it. Used car superstores, independents and private sellers don’t have factory trained technicians and OEM parts…in fact they may not have a service or parts department at all. You won’t be able to claim priority handling in service when you bring in your Chevy you bought at CARMAX to the Chevy dealership. As rational business people, dealers will want to take care of their own loyal customers first.
4. Vehicle doesn’t fit needs: Sometimes your needs change and you get stuck with something you need to sell way before you expected to and take a beating on it. This can be especially true in trucks/SUV’s where a knowledgeable salesperson can help you determine the GVW, towing capacities, etc. When you over spec a product, you lose the incremental over spec; when you under spec, you stand to lose a lot more. You would not believe the number of people who don’t even test drive a new or used vehicle before buying it.
5. Buying from a private seller: You’ll have no warranty and recourse on the seller if a problem arises later. Even though the seller may have a clear Mississippi title, you may find that it had a previous salvage or flood title. This is because there is no national title database, each state does it. And some states (MS included) allow a vehicle to be brought in with a salvage title, go thru a simple inspection and magically issued a clean title. That can be a big mistake if you met a guy in a Wal-Mart parking lot to do a deal.
6. Poorly structured financing: You can obviously get clocked in financing but how do you really know if it’s a good rate or not? The best way is to get your free annual credit report that the government makes the credit bureaus offer. http://www.equifax.com/ You should do this annually to guard against identity theft and if you are actively car shopping, spring for the extra fee and get your FICO score (not the Experian score or any knock-off) . The median FICO score is 723 and below 620 is “subprime”. It has been reported that 678 is “average” but that is not exactly right. A closely related pitfall is not putting enough money down. Even if you are a 800 beacon score, if your vehicle is stolen or totaled, you may owe more than its worth. Lots more if you drive a lot and/or don’t put much money down.
7. Buying based on the salesperson: One of the top reasons people give why they bought where they did was “they liked the salesperson”. Unfortunately car salespeople are notorious for high-turnover so choose instead to buy from a reputable company. A local company that contributes to local charities and soccer teams is a part of the fabric of the community. It’s likely they will be there when you need them. Choose a reputable, local, service oriented company that has several recessions under its belt so you don’t find yourself needing some records, advice, service or whatever and find the door padlocked.
6. Poorly structured financing: You can obviously get clocked in financing but how do you really know if it’s a good rate or not? The best way is to get your free annual credit report that the government makes the credit bureaus offer. http://www.equifax.com/ You should do this annually to guard against identity theft and if you are actively car shopping, spring for the extra fee and get your FICO score (not the Experian score or any knock-off) . The median FICO score is 723 and below 620 is “subprime”. It has been reported that 678 is “average” but that is not exactly right. A closely related pitfall is not putting enough money down. Even if you are a 800 beacon score, if your vehicle is stolen or totaled, you may owe more than its worth. Lots more if you drive a lot and/or don’t put much money down.
7. Buying based on the salesperson: One of the top reasons people give why they bought where they did was “they liked the salesperson”. Unfortunately car salespeople are notorious for high-turnover so choose instead to buy from a reputable company. A local company that contributes to local charities and soccer teams is a part of the fabric of the community. It’s likely they will be there when you need them. Choose a reputable, local, service oriented company that has several recessions under its belt so you don’t find yourself needing some records, advice, service or whatever and find the door padlocked.
About Wilson Auto Group: We started as a Dodge dealership in 1988 on Highway 80 West in Jackson. After earning a high degree of success and becoming the number one Dodge dealer in Mississippi for over 15 straight years, we acquired Kia in 2000 and Hyundai in 2003. We have won numerous major Customer Satisfaction awards in service.
We believe in treating people like we would like to be treated and giving back to the community of our time and resources. Our core values are: honesty, integrity, courtesy and professionalism. We also have a consignment program where we will get you RETAIL value for your trade-in…whether you buy from us or not.
We believe our mission in life is to serve the public with their transportation needs.
If you have any questions concerning this, we are here to help.
We are available 6 days a week (closed every Sunday) at 4200 Lakeland Drive near Dogwood Festival Mall and the Jackson Airport. 601.914.4200 or doug@wilsonautos.com
Or visit us online at http://www.wilsonautogroup.com/
Doug Wilson
President/CEOWilson Auto Group, Inc.
4200 Lakeland Drive
Jackson MS 39232
We believe in treating people like we would like to be treated and giving back to the community of our time and resources. Our core values are: honesty, integrity, courtesy and professionalism. We also have a consignment program where we will get you RETAIL value for your trade-in…whether you buy from us or not.
We believe our mission in life is to serve the public with their transportation needs.
If you have any questions concerning this, we are here to help.
We are available 6 days a week (closed every Sunday) at 4200 Lakeland Drive near Dogwood Festival Mall and the Jackson Airport. 601.914.4200 or doug@wilsonautos.com
Or visit us online at http://www.wilsonautogroup.com/
Doug Wilson
President/CEOWilson Auto Group, Inc.
4200 Lakeland Drive
Jackson MS 39232
No comments:
Post a Comment