10 Steps to Buying a New Car

The following steps will tell you how to locate, price and negotiate to buy the car you want. If you still don’t know what car to buy, read 10 Steps to Finding the Right Car for You and then come back after you have decided.

Step 1: Starting Out
These steps will help you to locate the specific car you want, and at a price that is fair to both you and the dealer. By now, you should have done plenty of research to determine which is the best car to suit your needs. And, you should have a good idea of what to pay for the car you want. Now you need to narrow the research even more. You will soon be finding the exact car you want to buy - with the options you have chosen - and then you will be determining the best deal available. If you have done your homework, this will be a fairly easy process with no unexpected surprises.

Buying a car is a big investment, but it can be exciting and rewarding, especially if you feel like you got the right car at a fair price.

Step 2: Using incentives and rebates.
Today’s new car market is crowded and competitive. Many new cars are offered for sale with attractive incentives to make you choose a particular model. In some cases, the cars with the best incentives are those that aren’t selling very well on their own.

An incentive is anything that gives you an added reason to buy a particular car. Often, however, it comes in the form of a cash rebate or low-interest financing. These can result in a huge savings to you.

Check the IndiaAutomobile.com Web site for the latest incentives mentioned under buyer’s notes. While we do track these schemes from the dealerships, these may not always be available. You can also watch for newspaper promotions but, remember, the incentives don’t apply to all models.

Dealers also offer special rates for employees of certain organizations. So make sure that you check with the dealership whether your employer falls under this bracket.

Step 3: Pricing the car.
Car salesmen will usually point to a car’s “sticker price” as the amount you have to pay. However, the dealerships are generally willing to sell a car at slightly lower than sticker price.

Now it’s time to factor in the incentives and rebates you researched in the previous step. Take the final on-road price offered and deduct the amount of rebates and incentives. If you are going to use low-interest financing, calculate your final buying price, then use our payment calculator to find your monthly payment.

Print these figures and carry them with you for reference as you continue the car-buying process.

Step 4: Finding the exact car you want to buy.
You should now have a very specific idea of the car you want to buy. This means you know the make, model, variant, features and colour. These details are available on IndiaAutomobile.com (just in case you have not completed your research).

Also, on IndiaAutomobile.com, you can simultaneously solicit quotes from multiple dealers. In many cases, you will have to follow up with a phone call.

Step 5: Test driving the car salesman.
As you call dealerships to locate the exact car you want to buy, you can also test drive the car salesman. In other words, you can determine if this is a person you want to do business with. It’s a good idea to consider this issue ahead of time, before you get to the deal-making phase of the process.

The first way to evaluate a good salesperson is to ask yourself if you feel comfortable dealing with them. Are they impatient and pushy? Or are they relaxed and open? If you asked them about a specific car’s availability, did they respond to your needs? Or did they try to steer you toward another car simply because they have too many of that model in stock? Do they return your phone calls? Do they answer your questions in a straightforward manner? Or are they evasive and confusing?

By considering these issues you should have a sense of whether or not you want to buy from this salesperson. If you feel comfortable with the individual when researching by phone, and if the dealership does indeed have the car you’re interested in, set up a time to test drive the car, preferably when the dealership will not be very busy, such as a weekday morning. Before heading to the car lot, review all your notes and make sure you bring your car-buying folder. This might include your checkbook, registration and proof of insurance. Keep in mind that you’re bringing these items so you’ll be ready to buy a car if you get a fair deal. Don’t feel obligated to purchase a car simply because you have all the necessary paperwork with you or because you test drove the car.

Step 6: If you are trading in your old car…
If you are trading in your old car to a dealer, you will probably not get as much money toward the price of a new car as you would have if you’d sold it yourself to a private party. However, trading in offers some advantages. You can solve all of your car-buying problems in one visit to the dealer. You can unload a hard-to-sell car with no newspaper or Intenet ads.

Begin the process by checking up your car’s trade-in value. At a dealership the value assigned to your trade-in varies based on the time of the month, the dealer’s specific inventory and the used car manager’s mood, so it is better you a rough idea of what your trade-in is worth.

If it’s important to you to get the maximum value for your trade-in, you should visit several dealerships and solicit bids. Tell the salesperson that the sale of a new car will be contingent on the amount he or she will give you for your trade-in. Also, tell them you are visiting several dealerships. With a little legwork, you may be able to boost the price you get for your old car. Remember, the extra effort you spend in getting competitive bids is far less than what it would take to advertise, show and sell the car yourself.

Alternatively, we advise you to advertise your car on IndiaAutomobile.com and make the listing visible to the millions of visitors on our site.

Step 7: Negotiating for the best finance option.
Dealerships generally have tie-ups with one or more loan providers. However, these may not necessarily offer you the best interest rate. Also, you are not obliged to stick to the dealer’s finance partner. Hence, it is always advisable to look at the best option available basis the exact monthly payment that is quoted to you.

Also, if you are planning to foreclose your car loan in the near future, please check for applicable penalties that would apply.

Step 8: Closing the deal.
If you feel good about the price you have been quoted, it’s time to take a look at the big picture. Many buyers focus on the cost of the car and ignore the related expenses. Besides the cost, you will have to pay sales tax and various fees which vary from state to state.

The simplest way to estimate total cost is to ask the salesperson to fax/email you a worksheet and invoice before you go to the dealership. This way, you’ll be able to review the figures in a relaxed environment.

Step 9: Reviewing and signing the paperwork.
At the dealership, you will be presented with the contract for your new car and a lot of forms to sign. This is usually handled by the salesperson you have been dealing with.

In most cases, the salesperson might try to sell you additional items such as extended service contracts, fabric protection, alarms, etc. In most cases, we recommend turning down these extras - with the possible exception of the extended warranty, which provides peace of mind to some buyers.

If you have already seen a worksheet for the deal you’ve made, the contract should be a formality. Make sure the numbers match the worksheet and no additional charges or fees have been inserted. You will also be asked to sign various forms that register your new car and transfer ownership of your trade-in (if you are exchnaging cars). Understand what you are signing and what it means. Ask questions if you don’t understand, and don’t ever feel like you have to hurry. Buying a car is a serious commitment and it’s the dealership’s job to ensure you are comfortable with every document involved. Remember, once you have signed there is no going back.

Step 10: Inspecting and taking possession of your new car.
You will have one more chance to inspect the car before you take possession of it. Make sure you walk around the car and look for scratches in the paint and wheels or dents and dings on the body. If you are paying for floor mats make sure they are included. If anything is missing, or if any work needs to be done, ask for it in writing. You will then be able to come back and get the work done later.

As you drive away inhaling that new-car smell, there is only one more thing to be done: enjoy your new car.