CAR BUYERS HOT on AUTO SALES.

 AS Americans we like to BUY stuff. SO in the midst of the greatest economic crisis of the past fifty years, we are tired of being tired.  We are also tired of driving cars that continually breakdown, have to share or no longer fit our needs/lifestyle.

Welcome to summer selling season in the auto industry. If it was ever time in the last two years, it’s a great time to go car shopping. Pent-up demand is driving car customers to dealerships hoping for half-price Jeeps and deep-deep discounts.  You may also want to RE-consider buying a soon to be discontinued make or model: SATURN, SAAB, HUMMER, PONTIAC and some Chrysler, Jeep and Dodge models; Chrysler Aspen and PT Cruiser, Dodge Durango and Stratus, Jeep Commander.

 

However, BUYER BEWARE. The car market has changed and you need to be prepared for some surprises. 

 

Salesmen/women.   The salesmen still stand outside, but there are far fewer of them. That may work well for browsers, but those ready to make a deal are going to find less product knowledge and willingness to trot around on long test drives.

 

Less Inventory.   The dealers have pared their inventories to all time lows, so be prepared to be flexible, to get a better deal now, or wait 10-12 weeks when ordering a car to meet your specs.  SOme HOT models are selling for higher prices now, than they were in January. During model year change over, you can also expect to pay more for the new year model, as the first ones delivered are usually the most in demand=higher price.

 

Financing.   Perhaps the hardest thing to understand about auto financing is the higher the score doesn’t guarantee you an immediate approval or the best rate.  Cash down, over and above rebates, are considered in the loan application, along with trade-in values and how many other cars notes you have signed for.  The auto banks are looking hard at car loans vs. debt and income. While mom and dad make great co-signers, if sister and brother have already tapped them, the next in line may need to ask another relative.

 

TRADE-IN.  When trading a vehicle with a payoff, you may be better off to make the payoff yourself, to be assured the closing dealership will, in fact, pay off the existing lease or loan. As dealerships are burdened with closing, employees are let go, and title payoffs can slip through the cracks. Having your trade paid off before the next payment is due, is crucial to keeping your credit in good shape.

 

Incentives. You can have rebates or low interest rates but not both. Don’t expect to buy a car for half-off sticker. The biggest discounts I’ve seen are $6,000 off a $40,000.00 car. Multiple rebates for everything from loyal clients to military and first-time buyers often cannot be layered, so pick the highest reward for your car, in real time. By REAL TIME, I mean NOW.  If you take a lower interest rate and payoff the car early, trade-it or it gets stolen/totaled, you have lost the full value of the interest saved. Sometimes cash in your deal as down payment, is the better deal because you have lowered the amount borrowed, and should a better rate be offered by another bank, you can move the loan.  Note, low interest rate incentives do not allow for negative equity from a trade-in.

 

If you are really interested in buying a new car this summer, look to a broker or car buyer’s agent to get the bottom line before you start kicking tires. They can help you figure out the REAL price on the BEST DEAL and find you the car you want, saving you hours of hassle, and aggravation driving from dealer to dealer. The fee you pay a broker or buyers agent more than pays for itself in time and savings you would not realize on your best day of negotiating.

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