Car Shopping - New Car Incentives
We’ll cover the
basic steps to buying a car for you in this article.
Although not
all encompassing in this short article, I’ll hopefully give you a
basic understanding of, and help you understand how to locate the
specific car that you want, and then obtain a price that is fair to
you and the dealership.
For our purposes
here, I will assume that you have done plenty of research and are
comfortable with which car best fits your needs, you budget, and
hopefully comes close to satisfying the ‘want’ factor.
If not please
stop now and go get your research done on getting the best car deal
you can.
Buying a car is
obviously a big investment for anyone, so you’ll want to be sure to
narrow your search to exacting calculations down to the options and
packages you want on your car. If you take the time to get this done
up front, I think you’ll turn the car buying process into an
exciting and satisfying project, especially when you reap the fruits
of your labor with a good car at price within your target range.
One of the big
advantages on your side as a potential car buyer is the
competitiveness of the new car market today.
And, the car market
competition breeds buyer incentives from the vehicle manufacturers
and the car dealers. As with any market, demand will drive supply
and price. So, you may find that the cars with the greatest
incentives are the ones that may not be selling at such a brisk pace
on their own. Of course, the inverse may be true too.
Let’s talk
briefly about incentives or the added reasons the automobile
industry gives you to purchase their cars. Most often you’ll see
these car buying incentives in the form of either cash back or
special financing. The cash back is the easiest to grasp. If a car
is selling for $25,000 and the manufacturer is offering $2,500 cash
back the net selling price offered would be $22,500. Easy enough to
understand. Now let’s use those same numbers as they would apply to
special financing incentives and plug them into a
monthly payment calculator.
If you financed
the $22,500 at 6% for a loan term of 5 years, your monthly payments
would be about $434.99. If the manufacturer was offering this same
vehicle price but with a 0% interest rate for the 5 year term of the
loan then your monthly payment would be approximately $375.00.
That’s a monthly payment savings of $59.99 every month. Over the
life of your car loan that adds up to a very substantial savings of
$3599.40 for you.
With car incentives
it is important to note that they probably won’t apply to all models
(probably the most popular models). Also, the car incentives may not
be offered in all regions of the country.
Remember earlier we
discussed that incentives are mostly driven by the market forces.
Furthermore, in order to take advantage of
most of these incentives,
your
credit rating
will have to
probably be good to excellent.
Also keep in mind there are also
‘hidden’ or unadvertised dealer incentives that are paid directly to
the dealer from the manufacturer in order to move certain cars. With
a bit of research from a distinctive website such as
Edumunds.com, you can ferret
out these ‘dealer cash’ incentives and keep the advantage in your
court.
- Shop, Save and Switch to GEICO today!
- Instant online quotes
|
|
