BME's Car "Education Center"

New vs. Used?

A used car can give you a lot for your money.

BME's reliability data can help you sidestep risk.

THE USED CAR "USED OR ABUSED?"

Certified Used Cars:

Usually sold through a New-Car Dealer.

• Inspected/Reconditioned.
• Limited Warranty.
• Usually more recent models that have come off lease programs or been traded in.

Used-Car Dealer or Private Seller:

"Buyer Beware"

• Always have a mechanic check the car your considering, cost approximately $100.00.
• May or may not have warranty protection.
• Reliability histories for more than 200 vehicles can be found in Consumer Reports, so do your homework.
• Gather information online such as a Carfax report.

KICK THE TIRES!

Things to do before you buy:

1. Check the exterior. Misaligned body panels or differences in paint shades are signs that the car has been in an accident.
2. Inspect the interior. Upholstery or carpeting stains and a moldy smell are signs of a water leak.
3. Look under the car. Oil or coolant drips could indicate that there is a serious problem.
4. Have your mechanic perform an inspection that includes an engine-compression test.

REASONS TO BUY A USED CAR:

1. Good prices. Prices of used cars, which outsell new ones by more than a 2 to 1 ratio, have been flat. One reason is the abundant flow of vehicles coming off lease. Only about 20% of leased vechicles are bought by the leasee.
2. Reduced safety compromise. Air bags and antilock brake systems have been standard in most models for several years.
3. Affordable luxury. If your wallet says economy but your heart says high-end, buying used may be a way to get your dream car.
4. Cheaper insurance. Premiums are lower for theft or collision coverage, which is related to total replacement value.

SMART STRATEGIES.

How to get the right car-buying information so YOU can take control of the deal.

Strategy 1. Narrow The Field - Unless you are the very rare buyer who knows exactly what you want, the essential first step is to settle on two or three promising choices.
Strategy 2. Drill For Details - Once you have a short list of cars, gather all the pertinent details on features, prices, safety equipment, financing, and insurance options.
Strategy 3. Decide Whether You Should Buy Or Lease - Leasing holds no inherent financial advantage over buying. The way you plan to use the car should determine which financing method you choose. (See the lease-or-buy quiz below).
Strategy 4. Nail Down The Price - Once you are fairly certain of the car you want and how much to pay for it, you'll need a benchmark price for bargaining. Everything else--including the monthly loan or lease payment--depends on your ability to negotiate the lowest price for the vehicle. The invoice price--the figure printed on the dealer's invoice from the automaker--isn't the best basis for bargaining. Dealers can lower their true wholesale cost by using one or more of the following: Holdbacks, Dealer Incentives and Rebates.
Strategy 5. Bargain Like A Pro - Make it clear to the dealer that you are serious about buying but won't sign a contract on the spot. Give the dealer the specifics about the car you want and ask for the dealer's lowest available price. Keep the deal simple. Don't negotiate against yourself. Be prepared to take a walk.
Strategy 6. Finish The Deal - Once you've agreed on a price, work out the remaining issues; do you lease or buy and do you trade in.

Lease-or-Buy Quiz

Is leasing right for you?
Answer each of the questions below, then tally the total points to learn whether leasing is a good, neutral or poor option for your next auto purchase.

1. I expect to hold onto this car:
   Three years or less. 1 point
   Between three and four years. 2 points
   For as long as it lasts. 3 points
2. The condition in which I keep my car is:
   Mint; it looks good as new. 1 point
   It has a few minor dents, scratches and interior stains. 2 points
   It has that "lived-in" look. 3 points
3. Within a year, I typically drive my car:
   12,000 miles or less. 1 point
   12,000 miles to 15,000 miles. 2 points
   Over 15,000 miles. 3 points
4. I frequently use the car to do the following (give yourself 1 point for each that applies):
   To commute more than 20 miles each way to work.
   To transport small children or pets.
   To take trips on gravel-surface or dirt roads.
   To haul heavy cargo.
5. To get this car I am willing to put down:
   20 percent or more of the purchase price. 3 points
   Some money, but less than 20 percent. 2 points
   20 percent. 2 points
   Nothing at all. 1 point

IF YOUR TOTAL SCORE IS:
4 to 7 points, you're a good lease candidate.
8 to 10 points, leasing and buying are both reasonable options.
11 to 16 points, buying is a better choice

For N.A.D.A BLUE BOOK VALUES call BME Federal Credit Union at 303-441-7800