Buying a Car

Buying a car can be one of the most exciting times in a person’s life, but it can also be really stressful if you don’t know what to expect. Here are a few tips that should help make the process less stressful and more enjoyable.

1. New or Used? A new car can be very exciting, but it might not be the best option for you. New cars come with warranties, but as soon as you drive them off the lot, they depreciate in value by around $8,000! So, if you get a loan for the vehicle, you already owe more than the car is worth once you drive it away. Used can be a great option, especially for a first vehicle. You will probably be able to find something more affordable that will be easier on your wallet.

2. Do your homework! Think about your needs and determine the type of car or features you will require. For example, will you need something big enough to transport your bike or other sports equipment? Is gas mileage important to you?

Once you have an idea of the kind of car you would like, do some research on the vehicle. Check out the different models and the prices they are going for. Craigslist can be a great option for researching prices in your area. Also check kbb.com (Kelly Blue Book) to get the value of the vehicle according to its conditions and the various extra options it might come with. Keep in mind that the more options that come with the vehicle equals a higher retail value. 4 wheel drive will cost more than 2 wheel drive, most of the time.

3. Retail value or “Sticker price” for a vehicle is usually negotiable. If you have done your research and you know how much the car is worth, you should be able to bargain with the dealer for a better price. Typically, prices are closer to the wholesale price when purchasing from a private owner (through craigslist).

Keep in mind that if you’re getting a car loan through Rogue for a used vehicle, the car will need to be valued under $15,000, and have fewer than 100k miles on it. Also, Rogue will only loan up to the wholesale value of the vehicle according to kbb.com, not the marked up retail value. Coming in with a good-sized down payment can help you get into the car you like. For example, if the wholesale value is 11,000, but you’re getting the car for 13,000, you will need to put down at least $2,000.

Before purchasing the car, be sure to do a Carfax report on the specific vehicle. This will show you the accident history and will show you if the car has a “salvaged title”. If it does, you should probably avoid this purchase. A salvage title can mean either that the car is stolen, or that it has sustained enough damage that it has been deemed not fit to drive.  This will be really hard to insure, and extremely hard to sell… not to mention, it could lead to a lot of costly fixes down the road.

4. Price or Payment? Both are important when purchasing a vehicle. The price you get for the car will determine how much you will end up paying overall, plus interest. Month to month, you need to be sure you will be able to afford the monthly payment on the loan, as well as full coverage insurance, and fuel! Research insurance costs and the gas mileage of the vehicle to be sure that these costs factor into your balanced budget. You may need to look into a different vehicle, or save up more of a down payment. The bigger the down payment, the less you are borrowing, and therefore the smaller your monthly payment will be.

5. Should i purchase GAP insurance? GAP insurance is guaranteed auto protection insurance and it covers the difference between the actual value of the car and what you still owe on it, if your car gets totaled. This can be really helpful if you are taking out a loan to purchase a car. It would not be fun to have no car, yet still have to be paying off a loan for the remaining amount or "gap" between how much insurance gave you for the value of the car and how much you still owe. By keeping these tips in mind, you will be on the right track to getting your first car. Just remember to do your research! :)

If you have any questions about getting an auto loan through Rogue, or have any other questions, feel free to stop by one of our branches and talk to a friendly member service representative. We'd love to help you out!