Buying a Car Checklist

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Buying a Car Checklist

Looking for a new or used car? This checklist will help you make sense of all that goes into the car buying process. There’s a lot you can do to stay on top of things and make sure you get the best car for you at the best price.

Don’t worry, MoneyMix and Dr. Mark Oleson from the University of Missouri’s Office for Financial Success are here to help you buy a used or new car with this basic checklist. Remember, you can add or delete items to make sure this checklist meets your needs.

What about leasing a car you might ask? Check out this article on the benefits and dangers of leasing a car. Simply put, leasing means you “rent” a more expensive ride for a few years, can’t drive it more than a certain number of miles, and don’t own it after the lease is over. For some this is okay, but for many the value of owning a used or new car is the better financial decision.


Figure Out the Complete Cost of Ownership
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Owning a car costs more than just what is on the price tag. Use the Complete Cost of Ownership worksheet to factor in all of the little things that add up. Once you’re done with this you’ll have a good idea of how much car you can afford.
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Grab a Car Shopping Buddy
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Find a family member or a friend with some experience who can share advice, and offer a second opinion.
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Make a List of Cars You Like
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You’ve probably already had your eye on a few styles or models… so make a quick list of the cars you are thinking about.
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Decide on New or Used?
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Used cars are often a better “value” because a new car depreciates as soon as you drive it off the lot… but used cars may have reliability issues. Certified used cars cost a little more, but are backed by a dealer’s certification and additional warranties.
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Use the Internet For Info
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Do a little research on the internet on the cars that you like. You can get some good information on new and used cars from sites like www.edmunds.com and www.ConsumerReports.org
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Learn About Loans
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The folks at the credit union will help you figure out everything you need to know about getting a new or used car loan. You’ll also learn what kind of loan you qualify for and how to get it.
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Decide How Much You Can Afford
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This is where the Complete Cost of Ownership comes in handy. After getting the details on car loans, your next step is to figure out how large of a new or used car loan you can afford to make monthly payments on.
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Find Out About Other Options
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Most folks go with a standard auto loan. But maybe, in your situation, there are other ways to get cash for a car like a home equity loan. If there are other options, your credit union will help you make the best decision.
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Use the Car Priority Worksheet
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Now it’s time to look at what you really want in car and how important those things really are. Use this worksheet to figure it all out.
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List the Best of the Best
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Compare the list you made of cars you like, to the list of priorities from the Car Priority Worksheet. Rank the cars you like based on how well they meet what you think is important.
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Evaluate How Each Car Measures Up
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Not every car will meet all of your expectations. So it’s at this point when you think about which cars are better than others for your situation.
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Create a Short-list For a Closer Look
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These are the cars that you want to get a closer look at… they are the top few that meet what you want, what’s important, and what you can afford.
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Search in Different Places
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Look around at dealerships, online, in the newspapers to get an idea of what’s available and where you can get a good deal on the cars from your short-list.
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Get in touch with Sellers
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You don’t want to waste your time checking out something that’s not right for you. So, pick up a phone and talk to the current owner or dealer about the details of the cars you find.
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Talk to Your Credit Union, Again
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Call your credit union for this final bit of research. This time, find out the current value of the cars you’re interested in.
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Visit the Best Cars for You
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Use the notes from your conversations to figure out which cars to go check out. Schedule a test drive, kick the tires, and make sure the car really matches your needs.
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Do This If it’s a used car…
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Make sure it has a clear title, and that you take it to a mechanic you trust to check under the hood. Ask for a Carfax report, that will give you it’s repair history and if the car has been in any major accidents.
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Pick a Good Time for Your Negotiations
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If you’ve found a car at a dealer, you can land a great deal during the end of each month and ESPECIALLY during the last two weeks of the year. Both times are when dealers are looking to squeeze in deals to meet end-of-year or end-of-month quotas.
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Set a Target Price, and Don’t Budge
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Okay, you know how much this sucker costs and how much you can afford from all of that work you did earlier. So, set your target price and the highest you’ll go for the final price of the car. Be prepared to walk-away if necessary.
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Keep an Eye Out for Payment Myopia
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A common sales tactic is to get you to focus on the monthly payments, and not the overall price of the car you want. If you’ve followed the rest of this checklist, you’ve already figured out how much of a loan you can afford through your credit union, so negotiate the overall price of the car as low as you can. Don’t focus on the payments at this stage of the game.
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Wait to Mention your Trade-In
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At the dealership, first settle on pricing for the current car THEN talk about how much your trade-in is worth.
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