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Here’s How to Get a Great Deal on a New Car

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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In the market for a new car? Don’t worry, scoring a great deal on a new car doesn’t have to be overwhelming. There are numerous ways to get a great price if you know how to ask for the deals and know where to look for them.

If you haven’t done a ton of research, it’s a little nerve-wracking to visit dealerships and negotiate prices in addition to discussing policies for warranties and insurance.

But it doesn’t have to be that way. There are a number of tactics and resources to help navigate the somewhat pressure-filled undertaking of buying a new car.

There are a lot of moving parts to figure out if you are getting a good deal on a car. You have to consider things like the upfront costs, long-term expenses, and rates. Fortunately, doing your homework beforehand can help you snag the best deal.

Eight ways to get the best deal on a new car

1. Understand the total price you’ll pay

Most of us just think about the monthly payments, and how it will fit into our budget. That’s a major mistake for two reasons:

  1. It can make the loan term longer and/or boost the interest rate.
  2. It makes it harder for you to understand exactly what you’re paying for when you’re just going by a monthly fee.

You’ll want to get a monetary breakdown of everything you’re paying for before you sign on the dotted line. Ensuring that you receive the out-the-door price that includes tags, taxes, fees and any other extras will go a long way in helping you understand exactly how much your new car is costing you.

You’ll want to be certain you know the invoice price of the car, not just the manufacturer’s suggested retail price (MSRP). The invoice cost is what the dealership paid the auto manufacturer for the car. This will become key in your price negotiations down the line since you’ll want to negotiate the price of the car down to as close to this number as possible to get the best deal.

2. Know your trade-in value

Knowledge is power. If you are interested in trading in your old car (as opposed to donating it or reselling it), you’ll need to find out how much its worth. Fortunately, the National Automobile Dealers Association has a helpful guide for assessing the value of your old vehicle. Find out exactly the current selling price before you trade your car in at the dealership so you can know whether the dealership you are haggling with is giving you a fair market price for it. You could also read more about the people you might meet at the dealership.

3. Get preapproved

Getting preapproved helps you get a better deal because you know just how much you can afford, and it can help you score a better deal when it comes down to the negotiating table since you won’t necessarily need dealer financing. Getting preapproved means that you get a conditional approval for a loan at a set interest rate, period and for a set amount of money. Obtaining preapproval for a loan has definite pros, including:

  • It’s simple and quick. You could also compare custom offers from multiple lenders in just minutes.
  • It will save you time at the dealership. When you do some of the virtual paperwork at home, you will probably spend less time with the sales and finance representatives.
  • By getting preapproved, you are doing your due diligence by taking control of financing experience of purchasing a car. This shows you are serious about getting the best deal, and you’re taking the necessary first steps toward financing your new car. Also, when you arrive at the dealership, you’ll have a pretty solid idea of the interest rates and terms you can expect for the car you’re buying.

Just as there are positive points to getting preapproved, there are some drawbacks as well. Ronald Montoya, senior consumer advice editor for Edmunds, said there aren’t too many negatives to being preapproved, but consumers should be aware of the following:

  • Don’t “sit” on your loan application. Banks can choose to do a hard inquiry or soft inquiry on your credit every time you apply for preapproval. According to Montoya, if you do all the preapprovals within two weeks, the banks know you are shopping for a car, so they won’t ding you every single time you apply for a loan. If you wait for a while, it’s considered a separate occasion and that may reflect badly on your credit. Check with each bank before getting preapproved to see how they pull your credit.
  • Be mindful of how much money you’re borrowing. Montoya said it varies by bank, and some banks will approve a specific amount and that gives you the flexibility to change your mind on certain models as long as it’s within that price range. Other banks will want to know exactly which model you’re interested in, and give you a loan for that exact amount, so you’ll need to check with that bank before getting the preapproval.

As a rule, Montoya said it’s a good idea to know what you can afford. If you realize that you didn’t get preapproved for the amount, there may be an issue with your credit that needs to be addressed.

4. Shop around

You need to know what kind of deals are out there and compare as many offers as you can. You may also want to check out dealerships and showrooms outside your local market. Sure, you may spend more time and a little more gas getting to some out-of-the-way places, but it’s worth it to compare offers.

Gathering multiple price quotes can also help you lower the price. By presenting a dealership with competing offers from other dealerships, you may get the sales folks to engage in a kind of bidding war. In doing so, you may walk away with the lowest price by obtaining more than one offer from other showrooms in the area.

5. Flex your negotiation skills

Montoya said it’s always a good idea to negotiate because the first price you get is not necessarily the best price you can get. He suggested that people do away with any outdated notions about negotiating as being a kind of haggling – going back and forth on price. He suggests getting a number of different prices from different dealerships on a vehicle so you have a number of options: if you don’t want to negotiate, you can just take the lowest one. Or, if you like one that costs a bit more, but you are a fan of the service at that particular dealership, you can ask the salesperson if they can beat the price you received earlier. You can let the staff know you want to do business with them because of their location, or because they had the vehicle in a color you really want.

“This way,” Montoya explained, “you have a reason for why you’re negotiating. Even if you’ve just checked the price online and seen what the market value is. That’s something you can point at, as opposed to just saying, ‘Can you knock off $3,000 off this car?'”

Knowing that there are multiple prices floating around makes your case much stronger and can snag you a better deal.

Here are a few tips for being a pro negotiator:

  • Don’t get emotional

Remember negotiation is about business, not feelings. Don’t get swayed by emotions when you’re negotiating the car of your dreams. You should always be ready to pursue another dealership at the drop of a hat in order to get the best deal.

  • Do the math

If you’re asked, “How much can you afford to pay per month?” be extra careful.
That’s the advice of Sonia Steinway, president of Outside Financial, LLC. “That’s usually one of the first questions dealers ask prospective car buyers, and it should be a red flag,” she said. “The dealer knows that few car buyers like to do the math. As long as the dealership can extend the loan length to adjust the monthly payment, the customer doesn’t think about the total purchase price. The borrower pays more in the long-term, but doesn’t feel the pain each month,” Steinway said.

  • Think twice about bundled features

Before you set out on your car-finding mission, Montoya advises buyers to make a quick list of must-have options. Then, figure out which trim levels and options are going to include what you want. “If, for example, you want navigation, and it’s bundled in a technology package that costs like $2500, then you have to really debate how much you need that navigation,” he explained.

Montoya suggests that you take your must-have list with you as a reference point while you shop. “It’s important to know the basic features that you want to have,” he said.

  • Don’t shop while drowsy

Car dealers know that most consumers hit the cognitive overload point after a long day of perusing the showrooms. Sonia Steinway said that’s one of the reasons they wait to present financing options until after you’ve already spent a few hours test driving and haggling over price.

“You’re tired, hungry, and overwhelmed, and that’s when psychological research suggests you are the most vulnerable to being taken advantage of,” she said. Just like you shouldn’t go to the grocery store when you’re hungry, never shop for a car when you are feeling exhausted.

6. Have a Plan B

You may have tunnel vision when it comes to your dream car, but there are comparable models that may net you significant savings. You owe it to yourself to consider those vehicles and see if one might suit you better than the car you had your heart set on. Be sure to check out the comparison tools provided by NADA and J.D. Power for help comparing different makes and models.

7. Rebate? Great!

Automakers and dealers continually offer rebates and incentives. It’s always a good idea to ask about current specials, sales events and inventory blowouts. You could walk away with a great car, and a great deal.

8. Warranties, insurance and other things to consider

Extended warranties are another thing to consider. Montoya said there is really no simple answer to whether buyers should opt for an extended warranty. It’s very much a personal choice.

“Some people do want that piece of mind that an extended warranty gives them,” he said. “Others,” he continued, “question the price of it.” He advises asking questions about warranties and other extras before you sit down in the dealership’s sales office, where it becomes a pressure-filled push to seal the deal that day. Call ahead to ask about the warranty. You have no obligation to buy the warranty, nor are you obligated to buy it at the time of sale.

“In fact, you have until the manufacturer’s original factory warranty expires, so that gives you some time to kind of spend some time in the car, see if it gives you any issues, and see if you want to move forward with that warranty,” he said.

Montoya also advises folks to consider insurance “very early on” once you’ve decided on a couple of vehicles. He said it can help you decide between two cars if one make/model has a higher insurance cost than the other. This particularly comes into play if vehicles have advanced safety features that include sensors like adaptive cruise control and blind spot monitoring. Those features add up to higher insurance costs because they are expensive to replace in the event of an accident.

The bottom line

Taking the new car plunge isn’t easy. Before moving forward on a purchase, you’ll need to do quite a bit of analysis and be extremely patient. Fortunately, today’s auto dealers know that buyers have extensive information at their fingertips and will work with them to make a deal. It’s important to do your homework, ask the right questions, be realistic about what you can afford and keep your emotions in check. By taking these steps, you can snag the keys to the car of your dreams, knowing you got a great deal.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lindsay Martell
Lindsay Martell |

Lindsay Martell is a writer at MagnifyMoney. You can email Lindsay here

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Chase Auto Loan Review

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Chase auto loan review
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Going into a dealership without knowing what auto loan you qualify for can be a dangerous adventure for your wallet. It’s best to have a couple auto loan preapprovals in your back pocket so the dealership can’t take advantage by charging you a higher APR. To help you research which lenders offer best rates, we did some work for you. Here, we’ll review auto loans by JPMorgan Chase & Co: the company, its rates, its pros and cons, how to apply and who may be a best fit.

About Chase

The largest bank in the U.S. with more than $2 trillion in assets, Chase offers everything from mortgages to credit cards.

Chase offers auto loans in all 50 states and D.C. with terms from 36 to 72 months. It also offers the car-buying service TrueCar at no extra charge. This service lets you see what others have paid for the same or similar cars, and has a network of TrueCar-certified dealers which compete for your business with clearly posted car prices.

Chase financing: At a glance

A Chase auto loan could be an option for you, whether you’re looking at a new or used car from a dealership. The bank may also refinance your existing auto loan or help you buy your car at the end of its lease period.

Though Chase declined to share its APR range, “Chase Auto offers competitive rates based on [a] customer’s credit history and the structure of the loan,” said Shannon O’Reilly, a communications executive with Chase, specializing in auto finance. You may be able to get an idea for what rate you might receive by using Chase’s Auto Loan Calculator.

Chase loan rate example

We used the Auto Loan Calculator to compare APRs for a new 2018 Honda in Michigan.

Credit scoreAPRMonthly payment
Excellent4.49%$365
Very good5.04%$371
Good6.84%$390
Fair15.09%$487
APR and monthly payment are for a 72-month loan of $23,000. Rates vary by location. Rates as of 1/7/19.

Are you an existing Chase customer? Chase offers a 0.25% rate discount for Chase checking customers interested in refinancing an existing auto loan. To qualify, you’ll need to have a Chase checking account before you apply for a Chase auto loan, and elect to have your monthly car payment automatically deducted from your Chase account.

A closer look at Chase auto loans

Here are the strengths and weakness we found looking at Chase auto loans. Be sure to compare any auto loan offers you may get from Chase with offers from other lenders.

Highlights of Chase auto loans

  • Credit decisions are usually made within three hours; three days is the maximum time to receive a decision.
  • There is no application fee.
  • Chase ranks in the top half of JD Power’s 2018 U.S. Consumer Financing Satisfaction Study for auto loans.

Lowlights of Chase auto loans

  • Chase doesn’t offer coupon books for you to keep track of your payments.
  • You may not be able to get a loan with Chase if you have poor credit.
  • Chase doesn’t offer auto loans for cars bought in private sales.

How to apply for a Chase auto loan

To apply, you’ll need to go to Chase’s website, call Chase or go in person to a Chase branch.

Whichever way you decide to apply, you’ll have to provide your personal information (e.g. name, date of birth, address, phone number, email, Social Security number), employment and income, the car you want, the loan amount and loan term you want.

You could apply by yourself or with a co-applicant. And if you need to change the car, loan amount or loan term once you’ve begun the application process, you could simply call Chase. Still, keep in mind that any changes you make could result in changes to your APR and other facets of the auto loan offer.

The fine print

To qualify for a Chase auto loan, you need to be at least 18 years old (in Alabama, 18-year-olds have to meet specific state requirements). Chase doesn’t finance all makes and models of cars: some lenders are reluctant to finance a car that is older than 10 years, has more than 100,000 miles or has a salvage title; Chase says it reviews any unique circumstances on a case-by-case basis.

Any offer Chase provides is good for 30 days. If you decide after 30 days that you would like to get an auto loan through Chase, you’ll need to apply again.

Who is Chase best for?

Chase loans are best for existing Chase customers. If you aren’t already a Chase customer, you may be able to quickly become one and receive the 0.25% rate discount on your auto loan. The convenience of having everything in one account, especially if you’re already a Chase customer, is alluring.

It also doesn’t hurt your credit to apply to multiple lenders within a 14-day window anymore than it would to apply to one lender — plus, shopping around for a car loan is one of the smartest things you can do.

So, if you think Chase may be a good fit for you, apply to Chase and compare the offer you may get with responses from other lenders. Potential lenders include your bank, credit union and online lender. And at LendingTree you could fill out an online form and receive up to five potential auto loan offers. LendingTree is the parent company of MagnifyMoney.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Jenn Jones
Jenn Jones |

Jenn Jones is a writer at MagnifyMoney. You can email Jenn at [email protected]

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RV Buying Tips: Get the RV of Your Dreams

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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Ever dream of buying an RV? You’re not alone — about 10 million households in the United States already own an RV.“The popularity of RVing is at an all-time high because of the freedom and flexibility RVs offer,” said Kevin Broom, director of media relations at the RV Industry Association (RVIA). “With the same RV, people can take an array of trips, spend time having adventures with friends and family and form memories that will last a lifetime.”

When shopping for a unit, you’ll need to consider what type of RV suits your needs, how much time you plan to spend in the RV, whether you want to buy a new or used unit (or lease an RV) and how you plan to pay for it. This article will explain the costs of owning an RV, as well as how you can get your best price.

The costs of an RV

RVs have a huge range of prices, which vary depending on size, style and other factors, said Broom. As of the date of publishing, here are some estimates for a variety of new RVs, according to the RVIA:

  • Folding camping trailers: $6,000 to $22,000
  • Truck campers: $6,000 to $55,000
  • Conventional travel trailers: $8,000 to $95,000
  • Fifth wheel trailers: $18,000 to $160,000
  • Type B and C motorhomes: $60,000 to $150,000
  • Type A motorhomes: $60,000 to $500,0000

You may be able to save some money by opting for a pre-owned RV instead of a new one, added Julie Bennett, who, along with her husband Marc Bennett, authored the book “Living the RV Life: Your Ultimate Guide to Life on the Road,” and run the RV Success School.

“We have met people who spent less than $5,000 on their RV, and others who spent over $1 million,” said Marc Bennett. “Most of the people we have met that do extended travel in their RVs typically spend between $50,000 and $150,000 on their RV setup, which includes the cost of the truck and trailer, or a motorhome plus the vehicle that they tow.”

You generally don’t need a special license to drive or tow an RV, said Broom, but it’s not a bad idea to look into the laws in your state, especially if you’re buying a very large trailer or motorhome.

The RV, as well as the truck and trailer if the RV needs to be towed, is just one of the costs to consider. You’ll also need to budget for maintenance and repairs, taxes, insurance, vehicle registration, fuel and storage. These expenses can vary from state to state.

There are also an array of optional (though potentially desirable) add-ons, like roadside assistance and extended warranties, that can increase the bottom-line costs of RV ownership.

“RV dealers will try to upsell you on things like paint protection and other options you may not really need,” said Marc Bennett. “You’d be surprised how much all of this can add up, so do your homework in advance and know what you are getting yourself into before committing.”

What kind of RV should you buy?

One of the first things to consider when figuring out which type of RV you should buy is how often you intend to use it.

“If you only plan on RVing a few weeks a year for short vacations, it really doesn’t make sense to spend a whole lot,” said Julie Bennett. “If you’re planning on using your RV for extended travel or even live in it full-time, then it’s easier to justify a bigger investment.”

Here are some other questions you should ask yourself when shopping for an RV:

  • Who will be traveling in the RV? A couple of retirees who are OK roughing it on the road might opt for a travel trailer, while a large family with pets may be better off with a camper van or motorhome.
  • Where do you plan to take the RV? Julie Bennett suggests that potential RV owners think about whether they want to stay in campgrounds with hookups for electricity, water and sewage, or camp off-grid in more remote places, and find an RV that fits those needs.
  • Do you need a special license for the RV? Large trailers or motorhomes may require a special license in certain states, said Broom.
  • What “toys” are you bringing in your RV? You may need to splurge on a larger RV or motorhome if you plan to take bikes, ATVs, kayaks and other recreational gear on your adventures.
  • Does the RV have a floor plan and layout that makes sense for you? “Pay attention to the things you will use most often,” advised Julie Bennett. “Is there sufficient counter space in the kitchen for making meals? Can you fit inside the shower and wash your hair?”
  • How far will you take the RV? If you want to keep costs in check on long-haul trips, you might need to pay more attention to things like the weight and aerodynamics of the RV. You should also consider whether you want a diesel or a gas engine. Gas engines generally don’t get as much power or as efficient mileage as their diesel counterparts, but they tend to be less expensive.

Should you buy a new or used RV?

Every future RV owner is faced with one big question: Should you buy a new or a used RV? Here are some pros and cons to consider.

Pros and cons of buying a new RV

Pros

  • You know the history of the RV. Buying a new RV means you don’t have to worry that a previous owner cut corners on care and maintenance.
  • You can personalize the RV. “Some may like that they can choose their floor plan, layout, decor, color scheme and options, and some may want the latest technologies,” said Marc Bennett.
  • You can avoid potential allergens. Does your child have a severe peanut allergy? There’s no guarantee a used RV doesn’t contain peanut residue from a previous owner, so you might be safer buying a new one.

Cons

  • You’ll probably pay more. “Not only will you pay more for new, you will also see the sharpest dip in depreciation as soon as you drive it off the lot,” said Marc Bennett.
  • You still may need to make repairs. Just because you’re buying a new RV doesn’t mean it will be trouble-free. “RVs are very complex, and built by hand in relatively low-tech facilities,” he added. “Once new RVs leave the dealer’s lot, they tend to need more repairs and fixes — much like a punch list on a new house build.”

Pros and cons of buying a used RV

Pros

  • You’ll probably save money. The older an RV is, the more of an effect depreciation will have on its price tag, said Julie Bennett.
  • It’s already broken in. The problems associated with a brand new RV may have already been taken care of by a previous owner, which could save you time and money on repairs.
  • It might come with extras. People often include extra items when selling their RVs, said Julie Bennett. You may luck out with an upgraded suspension, RV gadgets or kitchenware at no additional cost.

Cons

  • It comes with risks. If the previous owner didn’t maintain an RV properly, it may need new parts or repairs.
  • You may need to renovate it. If an RV’s aesthetics are dated or simply unappealing, it’s on you to fix it up.
  • It probably won’t have a factory warranty. You may need to shell out for repairs right away before you can drive the RV, said Julie Bennett.

Where can you buy an RV?

There are a variety of places to buy an RV — and according to Marc Bennett, you may need to travel far to find the right one at the right price: “We traveled thousands of miles when buying our first RV. Opening up geographically allows for much more selection,” he said.

Here are some of the places you can start your search for an RV:

  • New RV dealerships: Looking to buy a new RV right off the lot? Then shopping at a new RV dealership might make the most sense. “Buying from a respected dealership might provide some peace of mind that they have checked the unit and it is ready to go,” said Marc Bennett.
  • Used RV dealerships: Used RV dealers might not know as much about the history of a particular unit as its original owner. However, you may be able to purchase an extended warranty for some added protection.
  • RV shows: RV shows offer the opportunity to see a wide variety of models in one place. Should you find the unit of your dreams at an RV show, you may be able to score special discounts.
  • Private sales: Buying a used RV directly from its owner allows you to learn more about its history, maintenance and unique quirks, said Marc Bennett. “An owner will be able to share much more detailed information about the specific RV than a dealership,” he added.
  • Online marketplace: Do you already know exactly what you’re looking for in an RV? An online marketplace could help you find it quickly. RVTrader.com and Craigslist are popular places to find private RV sales online, said Broom.

How do you get your best price on an RV?

The price tag on an RV can give you serious sticker shock. Luckily, there’s lots of room for negotiation, and you should not plan to pay the asking price, noted Marc Bennett.

“There’s no hard and fast rule about how much discount you can get on an MSRP [manufacturer suggested retail price],” he said, “but it is not uncommon to buy a new RV for 15% to 30% off the MSRP.”

Going into the negotiation armed with knowledge can help you get your best price on RV, added Julie Bennett.

“Get a few price comparisons on the RV you want to buy,” she said. “Know what questions to ask, know [what’s] a fair price for the RV you want, and keep an eye out for deals at certain times of year,” also noting that you may be able to get the best price when a dealer is clearing out old models to make room for new units.

If you can’t afford to pay cash, you may be able to take out an RV loan or secure other financing to make the purchase. Here are some ways to finance your RV:

  • Dealership financing: Dealerships may offer financing through lending partners (such as a bank or credit union), or offer in-house financing. This is convenient, as you can get your RV and your loan all in one place. However, dealers may use this type of financing to bolster their bottom line, so if the rate offered isn’t competitive, you might find a better offer somewhere else. Additionally, dealership in-house financing, which is usually offered to people struggling to find financing elsewhere, can carry high interest rates.
  • Banks, online lenders and credit unions: You may be able to secure an RV loan from an online lender, credit union, bank or other financial institution. Since dealers may not have partnerships with lenders you’re interested in, you may need to seek out quotes directly from the institutions themselves. Make sure to shop around to compare offers. Though credit unions may have lower rates, you’ll need to become a member.
  • HELOC or home equity loans: You may be able to use a home equity line of credit (HELOC) or a home equity loan to secure the funds for an RV. With both of these options, you’re borrowing a portion of your home equity. Keep in mind that you’re putting your home on the line with this type of financing, so make sure you’re on firm financial footing before moving forward. However, because the loan is backed by collateral, interest rates tend to be lower. With either option you’ll also need to pay closing costs, a process that can take several weeks or longer.

The bottom line

RVs offer the freedom to travel the country on your terms. Whether you dream of a life on the road or you’re just looking to spend a couple of weeks in the great outdoors every summer, you can get an RV to make it happen.

Remember: There’s no one-size-fits-all solution to finding or financing the RV of your dreams. Do your homework, know what you’re looking for and don’t be afraid to walk away from a bad deal. The right RV is out there waiting for you — and with enough legwork, you’ll find it.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Joni Sweet
Joni Sweet |

Joni Sweet is a writer at MagnifyMoney. You can email Joni here