Buying a Car

Buying a car can be a stressful process— finding a model you like, finding a dealer, and then finding a good deal. ProFed wants you to get the best price on the car you want, so we've compiled a list of tips to help you when you are ready for the dealership.

Research

Search online to find out the true value of a car. You can compare models, check on new and used car values, check resale values and more through our link to the National Automobile Dealers Association (NADA).

Make sure you know which model you want and then retrieve all of the price facts on it, such as the dealer's invoice price, whether rebates or dealer incentives are available, your ideal price, and where you plan to start bidding. Be sure to check the web sites of individual dealerships. You may also be able to get e-mail quotes from competing dealers to see who has the best price.

Get pre-approved for financing

By having financing such as ProFed's NewCarLine before you meet with the dealer's Finance and Insurance Manager, you can save money. You will also have more bargaining power with a check-in-hand.

Show your knowledge

Let the salesperson know that you've taken time to look for price facts on your car. You may know more than they do about the invoice price, so use what you know to negotiate. Also, let the dealer know exactly which model you want instead of saying that you're "just looking." The salesperson will know that you are serious about buying.

Don't buy on your first trip

Even if you find what you want on the first day, take some time to think about your options or investigate other dealerships. If you go back to the first place, the salesperson will be more eager for the sale if you have given it some time.

Bid low

Set a goal for what you want to pay, and then use the invoice price as a guide for where to bid. Don't start too low-this could make the salesman think you haven't researched the car. Give yourself some room for the dealer to come back, but try to stay as close to your target price as possible. If you are in a comfortable range of your goal, take the offer!

Be Aware of 0% financing offers

If you've seen offers for 0% financing from car manufacturers, you should consider all of your options and all of the details before you decide to sign up. These deals often include many hidden charges and conditions, so it is best to look into what they are actually offering you.

• "0%" does not necessarily mean "no finance charge." Usually the finance charges are still there, and are typically around $30 per thousand dollars borrowed.
  This would still add hundreds of dollars to the total price of the vehicle.
• The fine print on many 0% financing deals often reveals that they are only available for 12 or 36-month terms, making your payments much higher.
• 0% offers are usually only available for individuals with immaculate credit.
  What does this mean? Well, that depends on qualifications established by a dealer's financing company, and they each use a different institution with their own qualifications. If you do not have the kind of credit that qualifies for a 0% offer, you will be elevated to a higher interest rate. Your interest rate and finance charges may also jump if you have a late payment.
• Some models may not be financed with the 0% offer.
• You may be restricted to the cars they have in stock. Dealers may not have the color or options that you want on their lot.
• You may be required to make a large down payment to get the 0% financing.
• You may have to give up a substantial rebate to take the 0% financing.
• 0% offers are usually made on cars that don't sell quickly. Chances are that these cars would have lower resale value as well.

Although the 0% financing at the dealership looks attractive, you have some choices that may be better for you. Check on our rates and use our loan calculator to help determine the true cost of 0% versus our low NewCarLine rate.