Is your passenger car a rolling embarrassment? Or possibly it won't even go anymore. If a active set of wheels is on your shopping list but your wallet's impression wafer-thin, take heart. There may be no better term to buy a old vehicle. With automobile reliability better than ever, inflation on the hillock and consumers tenderness pinched, Americans are flocking to hand-me-down cars. In 2007, we bought 41.4 million of them -- compared with just 16.1 million inexperienced vehicles, according to CNW Marketing Research Inc. This year that distinction is only expected to grow.
New-car sales are slumping, so dealers are putting greater gravity on their used-car inventories, oblation wider group and, in many cases, diminish prices. At the same time, cast-off cars are everlasting longer. Last year the general voyager agency in the U.S. was 9.2 years old, a record, according to industriousness critique alliance R.L. Polk.
And all things the options consumers now have in the used-car peddle -- from "certified pre-owned" cars to no-haggle superstores -- not to imply the assets of safety, reliability and pricing knowledge online, 2008 offers an unrivaled chance to get a great deal on secondhand wheels. Still, used-car dealers didn't draw their pad in the pantheon of villainy for nothing, and decades of rip-offs and other wild experiences have led several generations of Americans to grow a tireless antipathy to even thinking about going used. It doesn't have to be that way, says George Parker, a National Automobile Dealers Assn. doctor who trains knowledgeable used-car sellers. "The deal with has changed," he says. "Transparency is now the key.
" Even if that's the case, you essential to be microwave-ready to get the best deal. 1. How much to spend? Before you even deliberate about what automobile you want, presume out how much wheels you can afford. There's no black magic calculator, but cogitate on this: Financial planners suggest it's unwise to spend more than 30% of your revolting monthly income on housing, which should be your biggest expense.
Don't let your transport pay get so high that it cramps your gift to pay your mortgage, credit car-card bills or other recurring expenses. Now, do you delineate to pay all cash? Or will you get a loan? Paying banknotes can be wise, outstandingly if your credit isn't good, because you'll to all intents and purposes have to pay a acme interest rate. Drivers with avail credit can get low rates -- Capital One is sacrifice 6.09% on a three-year used-car loan, for occurrence -- so it might build sense to capitalize and keep the rest of your money in investments or use it to retaliate down other debts.
Think about the down payment, and appraise to put down 20% to 33%. But don't foolish that piggy bank flatly -- it's eminent to keep some cash on hand for emergencies. If you want to finance, crescendo to your bank or praise union and get pre-qualified for a loan; whether you use that lender's come forward or not, you'll get a get of what interest rate ballpark you're in. That can give you a pin up in negotiations with other lenders.
Take out the shortest credit you can, since longer ones (some gush seven years) end up costing more in interest. Keep in wit that used-car allowance rates are higher than those for creative cars. Get your put gunfire free at , and yield a return the fee to get your FICO score -- the gang between 300 and 850 that lenders use to terminate what interest rate they'll bill you. The higher your score, the degrade your rate.
"Cars are the second-biggest achieve most people make," says Steve Schooff of Capital One Automobile Finance. "Do your monetary scrutinize before you even appearance at a car." 2. What make of car? Armed with your budget, principal to car-research websites. and give instrument information and pricing.
Also contain automaker sites such as or , and price sites for example. Say you're concerned in a Honda. The Web can assert you what a 2005 Civic is worth, how many publish bags it has, its reliability and its encouragement efficiency. "This is your chance to front at all the options, all the features, to get all the facts," says Jim Riesenbach, manager master of , which has vehicle info and used-car listings on its site.
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