Buying your first car is an exciting milestone. Little can top driving down the open road with the windows down and that new car smell.
As exciting as it is, it’s not uncommon to have the excitement of it all get overshadowed by the stress that may come with the actual act of purchasing the car. The thought of financing and dealing with the sales person can be intimidating, especially if you have never purchased a car before. Think through questions such as: what should be my down payment? What is good interest rate? Am I really getting the best deal? Try not to allow these types of questions to be overwhelming. Financing doesn’t have to be stressful or scary. We’ve put together tips to help you get behind the wheel stress free!
Establish your budget.
Know what you can afford before you start shopping. Establishing a budget is key to helping you not break the bank. It’s important to figure out what you want your monthly payment to be and what your down payment will be, as both of these will play a factor in the length of your loan. Budgeting can get tricky and we have a great tool to help you through the process. Check out our loan payoff calculator to assist you in the planning process.
Do your research.
I know what you’re thinking, research? Really? Can’t I just go to a dealership and do the research in person to see what is available? The answer is, yes. You could just head straight out to the dealership and start shopping, but you could be costing yourself more money by doing this. Doing research before you go out gives you the upper hand. By researching the vehicle(s), you now know a fair price for the vehicles(s). You know the cost of additional options, and can decided the must have features and nice to have features that are within your budget. Doing your research will set you up to be a smart negotiator.
Get pre-approved for a loan.
Simplify the dealership experience by getting preapproved for a loan before walking in. This will allow you to gain financial leverage when negotiating and it helps you stick to your budget. This pre-approval also allows you to shop around a bit to make sure you are getting the lowest interest rate available to you. You can always go with the dealer option if it is competitive. Have a car in mind? Start shopping today by visiting an Ameris Bank branch nearest you!
Try to put down a sizable down payment.
A good rule of thumb is to try to put down 20% of the car’s total value. This is for several reasons. First, the higher your down payment, the lower your monthly payments will be. A higher down payment could also show your lender that you are responsible, since you were able to save a sizable amount and could lead to a lower interest rate. Lastly, cars depreciate in value very quickly after you drive them off the lot. The higher down payment helps keep you financially stable and assists in keeping you from potentially being upside down on your loan.
Being prepared both financially and mentally can help ease the stress in the purchasing process.
The information voiced in this material is for general information and is not intended to provide specific advice or recommendations for any individual.