President's Day car sale consumers, start your engines!
But first, auto experts recommend that you tune up your finances. Buying a car should not be an impulse buy inspired by a George Washington wig-wearing salesman shouting about a once-in-a-lifetime deal. “This is the second biggest purchase the average person makes,” after buying a house, says Paul Taylor, chief economist with the National Auto Dealers Association in McLean, VA.
Wanting a new car is a lot different than being able to afford a new one, so start by checking your credit report. Equifax is one company who can provide you with one. “Nowadays with the subprime credit crunch, the lenders have universally clamped down on loans or even gotten out of the business,” says CarBuyingTips.com CEO Jeff Ostroff. “You have to have super squeaky clean credit if you want to buy a new car.”
Buying a new car is not a right it is a privilege, says Ostroff. “If you don’t have the funds then you should not buy [a car],” he says. “People get very offended but it is a fact. If you don’t have the money you should question why you need a new car and consider a used car that has depreciated $6,000 to $10,000 already.”If your credit score’s OK, you should still bring a copy to the dealer for good measure. “They like to lie to you about your credit score," says Ostroff, referring to certain shifty dealers. “They say it is lower so they can charge you more with the APR.” Another way to save money? Avoid trading in your car with a dealer, says Ostroff. He says that most dealers will pay out up to $5,000 less than the car's value and then list it again for $3,000 above the market rate. Instead, try listing your car on eBay (EBAY) or Craigslist.