Steer Clear of These 10 Common Car Buying Mistakes

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Picture it: You’ve been driving the same car for 10 years. It’s been a reliable ride, but the luster has worn off. You’re ready to trade it in for something new and shiny.

At the lot, you find yourself caught up in the test drives, the new vehicle features, and the sales pressure. So much sales pressure. You drove in with a hard and fast budget, but you find yourself wondering if maybe, just maybe, you can push that by a few thousand and get the car the salesperson keeps pushing. You deserve it, after all.

Right?

Hey, we’ve been there. It’s easy to overpay for a new or used vehicle once you’re at the lot, and excitement clouds your judgment.

Before you buy your next car or truck, here are ten common car-buying mistakes and tips to help you avoid them.

1. Setting Your Sights on a Specific Model or Dealership

When searching for a new vehicle, don’t fix your sights on one specific make and model. There are probably alternative vehicles with similar specs that would work for your needs and budget. By only having one make and model in mind, you increase the likelihood of having only one or two cars to choose from at the lot. This makes it much easier to be backed into a corner by a high-pressure salesperson who will try to convince you to “buy today!” (…and overpay).

    Here’s what to do instead. Before heading to the dealership, have a list of several similar makes and models for which you’ve compared ratings, reviews, safety, reliability, and pricing. Then, shop around at different dealerships and try out the various options.

    This conveys to salespeople that you’re keeping your options open, and it helps keep you from getting pressured into the wrong car. You might still end up buying your #1 choice, but becoming a knowledgeable buyer will make you more confident and help keep your options open.

    2. Skipping the Test Drive

    It’s easy to assume that what looks good on paper translates to real life. However, shiny advertisements and catchy descriptions aren’t enough—you need to feel how the vehicle drives for yourself and ensure there aren’t any hidden surprises.

    Spend at least 30 minutes test-driving and inspecting the vehicle inside and out. Drive the car through various conditions, including residential streets, freeways, and parking lots. Pay attention to handling, acceleration, road noise, and comfort.

    The time you spend doing a proper test drive and inspection is well worth the effort to avoid buyer’s remorse down the road.

    3. Not Digging Deeper into a Used Vehicle’s Condition

    Unfortunately, unscrupulous (or unwitting) dealerships can hide a used vehicle’s true condition. Test-driving is a helpful way to catch hidden problems, but it’s not a fail-safe.

    In addition to a thorough test drive, you need a vehicle history report to verify that what you see is what you get.

    Some dealers will offer a free CARFAXTM report, allowing you to review the vehicle’s sale, title, and maintenance history. If the seller doesn’t provide a free report, you can purchase a CARFAXTM report yourself.

    You can also put the car’s vehicle identification number (VIN) into VinCheck.info for a comprehensive report, title check, and more.

    4. Negotiating Down Instead of Up

    It’s always wise to haggle with the salesperson, and most buyers negotiate down from the sticker price.

    Instead, try asking what the dealership paid for the vehicle and then negotiating your offer from there (it helps to have an idea of the car’s Kelley Blue Book value). This will give you a better idea of the dealer’s profit margin, allowing you to determine a reasonable price range that works for both parties.

    5. Only Focusing on the Monthly Payment

    One of the first questions many car salespeople will ask is, “What kind of monthly payment are you looking for?”

    Don’t answer that!

    This is one of the most common car-buying mistakes people make. Suppose your max monthly payment becomes the focus of negotiations. In that case, the salesperson may lump the vehicle price, dealer add-ons, trade-in value, and loan or lease terms together, giving the dealer far too much latitude to fabricate what looks like a “good deal.”

    In other words, they may try to get you to spend more than you intended by downplaying the total purchase price but keeping the monthly payment just below your stated maximum.

    Instead of throwing out your monthly max, have a total out-the-door price in your head before you step foot on the lot. For example, “I can spend up to $20,000 total” instead of “I can afford up to $500 a month.” Negotiate one variable at a time, starting with the vehicle’s price. Then, discuss your trade-in value, warranties, dealer add-ons, taxes, and fees, followed by financing or leasing terms to determine the monthly payment.

    It’s also essential to determine your budget beforehand so you know what kind of monthly payment you can afford. Try our easy-to-use Auto Loan Payment Calculator to crunch some numbers before you shop.

    6. Forgetting to Research the Value of Your Trade-In

    If you don’t know your current vehicle’s value, the salesperson may make you a low-ball trade-in offer. To avoid this, look up your vehicle’s retail and wholesale price on Kelley Blue Book.

    Also, don’t worry about fixing minor problems with your vehicle before trading it in. New tires, wiper blades, and an oil change won’t add much value. Put that money toward your new vehicle instead.

    7. Skipping the Call to Your Insurance Company

    If the vehicle you’re considering is significantly newer or higher in value than your current ride, you could be in for sticker shock when you update your insurance coverage.

    To avoid an unpleasant surprise, call your insurance agent and explain the makes and models you’re considering. Depending on your financing decisions or the car’s age and value, you will likely be required to increase your coverage, meaning higher premiums. Your agent can price out those policies and help you determine if you need Guaranteed Asset Protection insurance. Commonly known as “gap coverage,” this is designed to cover what you owe on a car and the car’s current value in the event the vehicle is a total loss.

    To learn more about gap insurance, check out the Frequently Asked Questions on Connexus’ Auto Loans page or schedule a chat with one of our auto lending experts.

    8. Ignoring Other Long-Term Costs of Ownership

    Certain vehicles come with higher long-term costs than others. For example, fuel efficiency, fuel type, maintenance costs, below-average reliability, expected resale value, and other factors could raise the long-term cost of ownership. Many high-end vehicles also tend to have higher repair bills.

    Do your due diligence surrounding long-term costs of ownership before you drive off the lot to avoid unwelcome surprises. Be sure you’re factoring in these long-term costs when deciding what car to buy.

    9. Saying Yes to Unnecessary Extras

    It’s common practice for salespeople to upsell you on extras you probably don’t need. These may include rustproofing, roof racks, paint and fabric protection, weather-proof floor mats, or VIN etching.

    Generally, most add-on upsells are more expensive when purchased at the dealership. Instead, wait and make the upgrades later. You can treat the paint and fabric yourself with inexpensive products. If you want VIN etching, you can purchase a do-it-yourself kit for a fraction of the cost. Fitted, weather-proof floor mats can be ordered online.

    Hold off on the add-ons. Purchase what you need after the sale from third-party vendors for substantial savings.

    10. Failing to Get Pre-Approved for an Auto Loan

    You might be an expert at negotiating the price, but you could lose out on those savings if you don’t choose your financing carefully.

      Many shoppers enter the dealership without considering where the auto loan will originate from, assuming the salesperson will secure the best deal. However, dealers sometimes mark up the interest rate over what you qualify for to boost their profit.

      This interest difference could cost you significantly throughout the life of the loan, so shopping around and getting pre-qualified before you head to the dealership is critical. Compare several lenders to find the best rate and term to fit your needs. 

      Read more about why you should get pre-approved for an auto loan.

      Apply For a Car Loan Online

      When you are ready to purchase a new or used vehicle, we’re here for you! Visit our Auto Loans page to schedule a chat with one of our auto lending experts, view our competitive car loan rates, and easily apply for your next loan online. Happy shopping!