Help a Newbie Figure Out How to Buy A Car
July 29, 2014 10:02 AM   Subscribe

I'm an inexperienced driver in LA who is starting researching how to buy a car (I'm considering both new and used at this point but probably the latter is more likely; I'll definitely be going to some dealer showrooms) for the first time. I don't know much about cars and I am feeling a bit lost.

It's all new to me and any tips would be much appreciated. I am a nervous driver and want something that is very safe and easy to use; it should also be very economical (and ideally eco-friendly) . I'm a single guy, so a compact car would be fine, probably preferable. I'm more interested in functionality than style (though naturally that would be a plus too).

Especially with the LA area in mind -
What steps should I take in my research process?
Which information resources/ articles etc. should I read?
Are there any hacks and specials secrets I should know about the buying and financing process?
Are there any car brands/models people especially suggest?
Thanks very much for any help!
posted by zresearch to Shopping (13 answers total) 8 users marked this as a favorite
the main thing about buying a used car is, have it checked out by your own mechanic. Any seller who objects to this is to be avoided.
posted by thelonius at 10:15 AM on July 29, 2014 [1 favorite]

Here are a couple of things I have learned about buying cars.

Dealers like to steer the conversation towards "what do you want to pay per month" for the car. I find this is not a very productive conversation if you are trying to get the best deal on the car. It helps to know how much the car is actually worth before you walk into the dealer. If you are discussing only monthly payments, it leaves a lot of levers for the dealer to pull in order to get as much money as possible for the car by changing rates and terms of the loan, etc. I recommend getting your own financing from your bank or credit union and do as much research on what the dealer is paying for the car (there are websites that can help with this, like Edmunds). If you go in with this data, you can steer the conversation to "how much for the car" which is the real question. After you negotiated an out the door price on the car, you can then entertain offers on dealer financing. I have found that I will go in with my own financing, and the dealer will sometimes offer me a better interest rate. But I usually don't discuss this with them until I am satisfied with the price of the car. I can't stress this next part enough...Be prepared to walk out. Maybe several times. If you ever feel pressured, or feel like you are not getting a satisfactory deal, just walk out. 95% of the time, they will follow you out and negotiate a better deal. If not, there are other dealers (I like to remind them of this often while negotiating). These tips mostly work with new cars, but I think it wouldn't be that much different with used cars.
Another trick for new cars that works nicely is to negotiate with dealers through email. Get several offers, and use them to negotiate. Dealer A offered me $x - can you beat that? Go back and forth. I have had luck with this technique in the past.
posted by OrangeGloves at 10:19 AM on July 29, 2014 [4 favorites]

Edmunds and Consumer Reports have good, readable, testing and recommendations.

That said, if you are wanting to buy new and pay around $17k or under, you will buy a Honda Fit, Toyota Yaris (or maybe one of the Scions), Ford Fiesta or Focus, Nissan Versa/Sentra/Cube, maybe a Kia Soul or Rio, or a Hyundai Accent.

If you buy used, you can probably go up one model from each of those.

These cars are all almost exactly the same in safety and engineering and gas mileage and functionality. You literally cannot go wrong buying any car, you could close your eyes and point.

They are cosmetically different, however, in ways that may suit YOU more or less. Are you very tall, or very short? Do you have a large dog, or a lifestyle that involves the transport of bulky things that might point you to a hatchback rather than a sedan?

The last place you want to get financing is at the dealership (though they will find you financing if all of the following will not). Join a credit union if you don't already belong to one, check with your bank, check with your credit card company. You want to know what interest rate each of them will offer you. Go with the one that is lowest.

The car is unimportant beyond you being comfortable sitting in it and looking out the windows/mirrors, using the doors and so on. Point your attention to the financing, get preapproval from your chosen lender, and then go find the car you like driving.

I will say if you are buying used and are super nervous, get your financing and then go to CarMax. They have streamlined the process to be less awful than dealerships. You may not get the absolute bottom price, but dealerships aren't interested in getting you the absolute bottom price either.
posted by Lyn Never at 10:20 AM on July 29, 2014 [2 favorites] is a really good source for local pricing info on new cars.

But, BE WARNED: Once you start pricing out a model, there are three screens. The first shows average local invoice price, MSRP, and price buyers paid. Click through to the next screen and it will show you a list of local dealers who are purportedly willing to sell you the car for $XX,XXX. Do NOT click through to the screen after that if you're not ready to talk to dealers, because moving on to screen three sends them your contact info and you will immediately begin receiving calls. I mean, immediately. I accidentally clicked through to screen three -- twice -- while pricing cars, and I got the first call within a minute or two. I finally installed an app on my phone that sends unknown callers immediately to voicemail, because I was getting, like, 14 calls a day from dealers who really wanted my business.

It's a good resource, but beware the dreaded screen 3.
posted by mudpuppie at 10:41 AM on July 29, 2014 [2 favorites]

If you are going to be financing, try and have a loan with a good rate arranged in advance. Then negotiate based on walk away price (including taxes and fees).

Once you have a price that seems fair, you can compare the dealer financing to yours and take the better deal.

When you are thinking about price bear in mind that fees tend to mostly be hidden markup. Avoid dealerships that charge weird extra fees, like VIN etching.

I don't have experience with private buys so the above is all for dealers.

I agree with Lyn Never that most brands these days make a good compact car; you might as well start test driving and see what you like.
posted by selfnoise at 11:12 AM on July 29, 2014 [1 favorite]

If you are unsure what kind of car you might like, you might consider a lease - you get a new car for a period of time (usually 3 years) and at the end you can decide to keep the car or get a different one.

Leases don't always make financial sense for every situation. They are an option that can get you into a car that has more features or more creature comforts for the same money as buying and if you don't like it, you have only a fixed commitment to it. It's an option to consider.

The above poster is correct that thinking about a car purchase in terms of "cost per month" is a poor way to minimize cost in the purchase. That said, if you don't know much about cars and what you like about them it can help you focus on the things that matter most to you right now. There are a dizzying array of options and features and all that, before you ever even get to the money part. So, if you aren't super price sensitive it's OK to focus on what your monthly payment will be.

Despite what any salesman says, you have all the time in the world. They will make more cars - if you are at all uncertain, or unsure, take your time and become sure. Never let a salesman push you into a sale you are only OK with.
posted by Pogo_Fuzzybutt at 11:17 AM on July 29, 2014 [1 favorite]

I've never bought a new car but when if and when I do I will follow the advice described in this comment. A friend of mine did pretty much exactly this and is very happy with the results.
posted by sportbucket at 12:53 PM on July 29, 2014 [2 favorites]

Always remember: they have lots of cars but you only have one monies. Act accordingly.
posted by sunslice at 1:07 PM on July 29, 2014 [1 favorite]

Would it be possible for you to car shop with a friend, someone who knows a fair amount about cars and has been through the buying (and owning and repairing) process before? If you're really savvy and you're with a friend, you can play a kind of good cop/bad cop game with the salesman. But more importantly, people who are knowledgeable about cars just know a lot that the rest of us don't. Plus, it's more fun than shopping alone.

Don't put down a deposit on anything until you check to get the Blue Book value.

Don't put down a deposit until you check CarFax to make sure the thing hasn't been in a flood, totalled, salvaged, etc. This is the last kind of car you want to buy.

Absolutely DO NOT buy something that in any way has been non-dealer modified (short of say, replacing the radio); anything with non-original wheels, ground effects, engine modifications, exhaust system mods, etc. must be avoided at all costs. You do not want to buy anything that some teenager has been fooling around with and then driving like a lunatic. It may have trouble passing inspection. Insurers don't want to insure these cars, either.

If you possibly can, get the paperwork showing that the car's been in for its scheduled maintenance.

Call your bank/credit union and get their best deal on a loan before you start shopping. Financing is a major profit center for dealers, and it's great to sit down with them after you've decided to buy the car and they start putting the screws on you regarding the financing to be able to say, "My credit union is giving me 2%. Can you match that?" They usually will. If you have good credit, you should be able to get a very low interest rate.

You must get the car checked out by a mechanic before you settle on a price. Get an estimate on whatever needs to be fixed so you can use that to bargain on the final price. So, if the mechanic says you need four new tires, price that out and use that in your negotiations.

Also, as others have pointed out, absolutely do not hesitate to walk away. There are a lot of fish in the ocean. Unless you're a car collector looking for a pristine Duesenberg, there are literally dozens of cars for sale right now in your area that will suit your needs. It may take you a while to find one, but don't buy until you're absolutely sure you're getting a good deal and you're getting the car you want. That said, you also have to be reasonable: if you're throwing out ridiculous lowball figures, you're just going to be wasting everyone's time.

If you're considering a specific model, go online and download the maintenance schedule. Look it over (with a knowledgeable friend, or ask your mechanic) and estimate what upcoming maintenance visits are going to cost. On a lot of cars, you have to replace the timing belt every 60,000-90,000 miles (and you MUST do this at the specified interval, because if the belt breaks, you will fry the engine). So be mindful if you're buying a car with 59,000 miles with a 60,000-mile timing belt change, that you're going to be spending $500-$1,000 right away to change that. You can use this as a bargaining chip.

Also, don't hesitate to look at used Hyundais (built within the last five years or so); despite the crapola Hyundai dropped on our shores in the '80s and '90s, they've really gotten their act together within the last ten years or so, to the point where quality and reliability are on par with the Japanese makers. Also, they depreciate like crazy, so you should be able to find a low-mileage one from the past few years at a bargain price.
posted by Leatherstocking at 3:30 PM on July 29, 2014 [1 favorite]

We recently bought a new car and used the information we bought from Fighting Cance. It's similar to the method in cebailey's comment that sportbucket linked, but provides some more information about pricing and negotiation strategy. Using this method we were able to get the car we wanted for more than $2000 below the invoice price. It was seriously astonishing how well it worked.
posted by medusa at 3:48 PM on July 29, 2014 [1 favorite]

Know what your bottom line is and stick to it. And as mentioned above, walking out is your best weapon. Stand up with a friendly sigh and say, 'clearly we are too far apart on this, but I don't want to waste any more of your time.' Do this several times if necessary. They will try to return with the same deal repeatedly. Just leave. If they let you, you wouldn't have gotten the car at your price anyway.

And always used; never new.
posted by umberto at 5:31 PM on July 29, 2014 [1 favorite]

thanks everyone! all of these are great tips!
keep them coming!
posted by zresearch at 1:53 AM on July 30, 2014

The Automobile Club of Southern California (AAA) has a service for members that enables them to buy a car at a discount. If I remember correctly, it pretty much eliminates the hassle of negotiating the price.
posted by conrad53 at 9:18 AM on July 31, 2014 [1 favorite]

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