Figuring Out If You Need a New Car
Deciding on how and when to purchase a car—whether new or used—is a big decision, and likely one of the larger financial expenditures you’ll make in any given year. Each person (or family) has different needs, budgets, wants, and credit scores that will inevitably impact what sort of vehicle they end up purchasing. But before the conversation of buying even starts, you need to consider why you’re even considering this big financial responsibility.
If you currently don’t have a car, and don’t have a reliable alternative like public transportation or a family or friend who lets you carpool to work and events, then owning a car is practically a given and eliminates the need for further deliberation. For most Americans, cars are a necessary expense, and one that probably won’t change for some time (where are those flying cars we were promised, Science!), so consider yourself in good company. That said, if you currently have a vehicle, ask yourself why you’re considering something different. Does your current car have lots of mechanical issues? Are there safety concerns? Does it have high mileage, or get poor MPG (miles per gallon) that costs you hundreds of extra dollars a year? Or maybe your family has grown, or your life circumstances have changed, warranting a different type of vehicle. Whatever the case may be, it’s always wise to ask yourself—and be able to answer honestly—“Do I need this?” before embarking on any large financial decision.
If you’re still reading, chances are, you fit the criteria of someone who does indeed need a new—or gently used—car. Congratulations! Now, here comes the hard part…
Setting Goals and Working With Lenders
At Easton Motors, we typically work with people whose credit has compromised their ability to get a new car, or one from a traditional car dealership, but that doesn’t mean the rules for deciding when to buy should be any different. Assuming you’ve established your need for a vehicle, one of the very first things you need to do is get your credit report and create a list or spreadsheet of all outgoing expenses and monthly income. Together, these two steps will help you establish a baseline budget that is both practical for your current circumstances, and will keep you from wasting time on a vehicle you can’t afford or won’t be qualified for.
Once you’ve established your credit and budget, the next step will be to work with a lender on getting pre-approved for a car loan (unless, of course, you plan to pay with cash—in which case, your credit score won’t factor into the equation). Getting pre-approved will take a lot of the guesswork out of the purchasing process, and save you from getting emotionally attached to something not within your budget.
After getting pre-approved and working with a BBB-accredited car company or lender, ask them to show you which vehicles they can offer that are right for you. This is a particularly important objective if you’re trying to rebuild your credit. The last thing you want to do in your rebuilding year is to over-extend yourself for a car that will bust your budget and ultimately keep you from getting your credit to where you want it to be. And, it goes without saying, but make sure that you’re working with a lender who shares your financial goals, and wants to see you succeed.