As the price tags on new and used cars continue to climb, saving money on transportation has become increasingly important. The average price of a used car reportedly spiked by more than 16 percent, year-over-year, and families are paying above Kelly Blue Book value in too many cases. We all need to get to work, run family errands, and enjoy a lifestyle that includes transportation freedom. The following 8 ways to save money on your next new or used car could help you achieve those goals.
1: Refinance Your Current Loan with Peach State
Buying when the new and used car markets are seemingly overpriced might not be the most cost-effective decision. It may be worthwhile to refinance your existing car loan and reinvest some cash into your current ride.
Start by bringing the vehicle to a reputable mechanic or dealership and get an estimate that includes necessary and cosmetic repairs. Ask an experienced auto mechanic to discuss the potential life expectancy of the car. Then speak with a Peach State team member about refinancing. If the numbers work, you could save yourself some money.
2: Learn to Negotiate
Haggling is similar to the gentle art of persuasion and being nice can prove very effective. Remember to come to the dealership having done your homework about the Blue Book values of new and used cars that fit your price range and lifestyle.
New and pre-owned car sellers typically have plenty of final price flexibility. Nudge the salesperson gently and politely toward the number you believe is fair. Don’t hesitate to walk away, try another dealership, throw out the lowest number you’ve received and ask if they can do better. You may have to spend a day haggling, but that’s money saved.
3: Determine Financing
New and used car dealerships like nothing more than someone with a reasonably sound credit score. That’s largely because many extend financing with higher interest rates and terms that favor their company.
One of the best ways to save money on your next purchase is to get pre-approved before walking the automobile lots. Credit unions traditionally offer among the lending industry’s lowest automobile loan interest rates, reduced fees, and repayment terms that favor borrowers. Even if you see fantastic financing deals advertised, getting pre-approved does not result in a hard pull on your credit score. However, it does give you tremendous bargaining power and a money-saving option.
4: Take Advantage of First-Time Car Buyer Programs
Car-makers and financial institutions offer first-time buyer programs designed to help new buyers secure a vehicle and build credit. Manufacturers sometimes offer special incentives or cost savings discounts on their new and pre-owned inventory as a way to make vehicles more affordable. It's important to research first-time buyer programs because they may have specific requirements for you to qualify.
5: Consider Skip a Payment Options
When shopping for your next new or used car, it’s important to differentiate between lenders and what they bring to the table. Credit unions are not-for-profit organizations that strive to increase opportunities for low-cost lending to their members.
One such option at Peach State allows borrowers to skip a payment when monthly budgets are tight. The Peach State Skip-A-Payment program allows borrowers to skip up to two payments per calendar year.¹ Not having to worry about a car payment during the holiday season or when you want to take a family vacation saves money and makes life a little less stressful.
6: Compare Car Insurance Options
Drivers are required to purchase automobile insurance to cover the cost of losses. The state mandate is not lost on insurance companies and some provide significantly lower rates than others. That’s why it makes good financial sense to shop around when purchasing a new or used car. And when your auto insurance agreement nears its expiration, it's a good idea to obtain multiple quotes to ensure you get the best deal possible.
7: Check Maintenance Costs
Not every maintenance plan from a dealership is created equal. While automobile sellers tout their maintenance plans, it’s crucial to do a deep dive into the costs. Some plans don't cover the parts most likely to falter with a particular make and model. Others offer free oil changes and maintenance but only for a set period.
It’s important to know the real maintenance costs associated with a new or used car, and the research can generally be conducted online. In terms of saving money on your next vehicle, those are hard numbers that need to be factored into the overall cost.
8: Check the Gas Situation
Prices at the pump set new records in the spring of 2022 and energy costs remain unpredictable. The miles per gallon of new and used cars rank among the driving reasons to select one vehicle over another. One of the best ways to save money is to purchase the most fuel-efficient vehicle that serves your needs.
We're Here to Help!
These tips will help you save money on your next new or pre-owned vehicle purchase. If you still encounter uncertainties throughout the process of shopping for your car, choosing your financing, or looking for a car loan, contact us!
Don't forget that all Peach State members have access to our vehicle-buying service, Auto Assistance. We also offer Auto Loans that fit your needs including a program for first time car buyers and members who may need a Fresh Start.
For more details on how to find the best used cars and car loan for your needs, and more tips to save you time and money on your car buying journey, review our "Car Loans 101: Car Buying Made Easy" complete guide!
1 All Peach State accounts must be in good standing and the loan for which you are requesting a Skip-A-Payment must have received 3 timely payments for the past 3 months. All real estate, credit card, student loan, other open-end loans, CD secured loans, Fresh Start loans, Quick Cash loans, and delinquent loans are excluded. Your request must be received at least ten days prior to the due date of your loan. The payment skipped is not covered by Credit Life and Disability insurance or Debt Protection. GAP insurance does not cover more than one Skip-A-Payment per year and no more than two Skip-A-Payments over the term of the loan. Fresh Start Loans: Skip-A-Payment program is offered after 12 timely monthly payments have been received and is limited to one skip per 12 month rolling period.
