New Car Purchase Mistakes

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John Hutchinson from Red Rocket Auto Tech has 10 tips for people planning on buying a new car.

Tips 1-3 -- Preparation

1.) Know what you need -- Some people rely on the dealership to tell them what they need.

2.) Test drive the car -- 1 in 6 buyers never test drive a car before they buy it; you have to drive the car to know if you like it.

3.) Make sure you prequalify yourself for financing before you head to the dealership

Tips 4-6 -- Financing

4.) Shop your financing separately -- Do not only depend on the dealerships financing; prequalify early to set affordability limit.

5.) Do not shop a monthly payment -- Resist making your payment a negotiating point; sales staff may manipulate finance terms.

6.) Forgetting Insurance -- New car loans require full-collision coverage; check rates before shopping.

Stay tuned for more tips next week in Part 3.

Tips 7-10 -- Negotiation

7.) Starting negotiation at MSRP -- Look for the price that the dealer paid for the vehicle

8.) Trade-Ins -- Research trade-in value of your car

9.) Walk Away -- Don't be afraid to walk away from the dealer if they aren't negotiating with you