Buying a new car is an exciting and (sometimes) overwhelming experience. Which car to choose, new versus used, different series, badges, options, makes, models, colours, extras…. The list just goes on. While it should be a happy and exhilarating time, buying a car can also be stressful and just downright traumatic. Time and time again, we see people’s car-buying experience overshadowed by the same common issues, errors and oversights. So, we’ve compiled a list of the most common car-buying mistakes people make to help make your next car-buying experience joyous and seamless.
1. Waiting too late to arrange finance
Finance can be an overwhelming topic. Comparing different finance options, getting all the necessary paperwork together, etc. It is easy to get caught up in the fun of buying a new car and forget about the not-so-fun parts like arranging finance. However, there are many advantages to arranging finance before you even start looking for your perfect vehicle that makes arranging a finance pre-approval a very good idea. Not only can you then go car shopping knowing that you are pre-approved for your car already, but it also gives you more bargaining power with both dealerships and private sellers, as we will discuss in more detail later.
Loans For U also make it as easy and seamless as possible to arrange a pre-approval through our smart online finance application system. You can even be approved and be driving off in your new car on the same day!
2. Not considering their budget
Many people go about their car budgeting completely wrong. Rather than simply saying, ‘I want to finance $20,000 on a car’, there is a better way of working out how much you can spend taking into consideration your current budget. Use our Repayment Calculator tool to work out what your estimated weekly/fortnightly/monthly repayments would be and see if it fits within your budget. It allows you to make sure that you will actually be able to afford your new car. It is also important to consider additional costs such as insurance, registration and regular car maintenance and make sure these all fit within your budget as well.
3. Not knowing their credit score
It is vitally important that you know what your credit score is before applying for any type of finance. You can get a copy of your Equifax Credit Report for free once per year. It doesn’t affect your credit score and can help you to get a better understanding of what a potential lender is going to see and use to assess your application for finance. Getting your free Credit Report once per year can also help you to keep your identity safe from identity theft and potential fraud. Make sure you check what is listed on your report and question anything you don’t think is correct.
4. Not having a pre-approval
Whether you’re looking to purchase your next car from a dealership or via a private sale, it is recommended that you get a pre-approval prior to shopping for a number of reasons. Firstly, it’s like having the money ‘in your back pocket’. You know you’re approved and you can act quickly when you find that perfect vehicle. Secondly, it gives you bargaining power, since the seller knows you’re a serious buyer. Thirdly, dealerships won’t be able to ‘leverage the deal’ with their finance, so you know that you’re able to negotiate the best possible price on your vehicle.
5. FOMO Purchasing
We see this one a lot! Buying a car is a huge decision – and an emotional one at that. It is natural to get emotional about such a big purchase, however, don’t let it get the best of you and push you into a snap decision that may not be the best one for you. It is important to take your time and consider all the options with both choosing your car and your finance so that you know you’re not only getting the best deal, but also the right one for you. Consider making a pro and cons list on the features and benefits of each vehicle to help you make a calculated decision based on facts rather than emotion.
6. Not negotiating with the dealer
The beautiful thing about having a pre-approval as discussed above is that now the power is in your hands. You have the ability to go into any dealership and negotiate a ripper of a deal because you are already approved and ready to go. Dealerships will be eating out of your hand and begging to make a deal.
7. Not using a finance broker
The great thing about using a reputable finance broker like Loans For U is that you get access to hundreds of finance options from over 40 of Australia’s leading lenders. The best part is that we compare them for you to find the best possible finance deal specifically for you and your needs. Sure, you can go to your bank, but they’ll maybe have one or two car loan products. We have access to hundreds and probably theirs as well. We work for you, not the banks and our job is to save you time and money while finding you the best possible finance for your next car. We do the running around for you and if you’re not happy with the options we come up with, you are not obligated to proceed with us.
So, if you’re looking for bank-beating finance for your dream car, speak to our friendly team today on 1800 538 287 or simply get your personalised quick finance quote online now.
