consumer tips

Good Deal or Not: Fleet Vehicles

May 10, 2019 by admin

Shoppers of used cars tend to buy from private sellers or car dealers, but there is another option that might be worth considering: a fleet vehicle. Fleet vehicles are those that were purchased or leased by a business or government agency and used on a regular basis. Taxis, police cars, government fleets, and rental vehicles fall under this broad category, typically representing hard-driven vehicles with many miles on the odometer.

Strong Inventory

Fleet vehicles are widely available and are usually sold to auction houses before consumers can get their hands on them. Consumers can sometimes buy one directly, skipping the middle man and his price markups.

The U.S. General Services Administration operates a GSA Fleet Vehicles Sales website that sells approximately 40,000 vehicles annually at approximately 40 sites across the nation. A variety of makes and models are offered. Some states, counties and cities also sell fleet vehicles directly to the public. A web search of “government fleet vehicles” should reveal local results.

Hit or Miss

Vehicle fleets may reflect a variety of makes and models, but if you are looking for a well-optioned model, your choices are limited.

Typically, the rental vehicle companies — Hertz, Budget and Enterprise, to name a few — stock higher trim level models. Most government and public utility fleets feature vehicles that do not come fully equipped. Nevertheless, the variety of trims and package offerings will vary depending on the department and vehicle use.

The Price is Right

When no middle man is standing in the way, fleet vehicles can be competitively priced. Pricing typically reflects age, wear and tear, mileage and the equipment package.

Don’t expect much room to negotiate, however, as prices are typically set and inflexible. For instance, when available to the public, such vehicles usually have the price prominently featured on the windshield. That’s the price you’ll pay and, yes, cash is king.

Hard Driving Takes it Toll

There is no way to escape the fact that fleet vehicles are used and often abused. Taxi and police fleets punish these vehicles which sometimes hit the market with more than 200,000 miles on the odometer.

Carefully following a maintenance plan can help, but you still have a vehicle that has seen much wear and tear and looks the part. If maintenance records have been kept, then examine them. If not, then inspect the vehicle carefully and don’t expect a warranty for well-worn models.

Expect to repair all dings, dents and the paint over stain the taxi decal left when it was removed from the vehicle before heading to fleet sale.

Financing May Not be Available

Most fleet vehicles are sold “as is” with a cash payment or certified check required. One exception is the rental car companies, as some provide financing or they may accept a loan you arranged with your bank.

Bargain prices are synonymous with fleet vehicles, but a good deal on price may turn out to be a bad deal on reliability. If you are handy with cars, then repair concerns are something that you can handle yourself.

See Also — Used Rental Vehicle Buying Tips

Should I Buy a Car Now or Wait?

December 8, 2017 by admin 2 Comments

A new car, truck, SUV or van may be in your future.

Besides reviewing cars on a regular basis — typically one or two new models week after week — I regularly dispense advice to friends who are shopping for a new or late model used car. Certainly, timing is everything when it comes to buying a car, but there are various times of the year when making a purchase decision is simply the right decision.

And to loosely paraphrase Queen Esther, “and such a time is this one.”

December is when we’re thinking about Christmas, especially decorating the home, preparing special meals, and throwing parties. But if you’re in the market for a car, you should seriously consider setting aside some time to find one as you enjoy the festivities. So, put down the eggnog and spend the next few minutes considering what I have to say.

Why is December so important? For two reasons:

1) dealers, with much manufacturer backing and incentives, want to clear their lots to provide space for new model year vehicles, and

2) manufacturers push hard to increase year-end sales in an effort to gain mark share. Yes, there are bragging rights going on for a number of categories, including best-selling car, truck, SUV, and so forth. The winners then advertise those results, thinking that you’re more likely to choose a best seller then consider some other model (often, consumers DO think that way).

It may seem counterintuitive for manufacturers to reduce their profits to increase market share, but that’s the way things work. Don’t feel bad for them, however. Most manufacturers can handle the big push. You just need to know how to save money when shopping for a car.

Here are some tips to keep in mind while shopping:

1. Year-end sales actually end in early Jan. Manufacturers post monthly sales, but those “months” don’t exactly correspond to the calendar. For the selling year, the calendar ends a few days into the next year. For example, 2017 new auto sales conclude at the end of business on Jan. 2, 2018. This means most dealerships will be open on New Year’s Day and stay open late the following day.

2. Bonuses are posted front and center. Year-end bonuses are advertised where you can see them: on the manufacturer’s website. And on dealer sites too. This week, I’m driving a 2018 Hyundai Elantra, so I went to the manufacturer’s website to see what specials are offered. Right off, there are $3,500 in cash offers (plus separate lease and finance deals) — $2,500 in retail bonus cash, $500 in holiday cash, and $500 in HMF cash. This means you can purchase a new Elantra SE for just $13,450. What a fantastic deal on a compact sedan!

3. Not all offers can be combined. Just because an offer is published, doesn’t mean you qualify for them. For instance, the Hyundai offer for $500 HMF cash means you accept the manufacturer’s financing arm’s standard financing rate instead of its promotional rate. That promotional rate currently stands at 0-percent APR financing for 72 months PLUS a $1,000 HMF bonus cash offer. Here, you’ll get the promotional financing rate and apply bonus cash to your down payment, but you won’t get the extra $2,500 for taking the special financing offer. Here’s my recommendation: arrange your own financing BEFORE you shop for a car, then take whatever offers are available. By the way, the special offers are usually on dealer stock only — not on the model you order.

4. You’re not eligible for every offer. Read the fine print of every offer you find. On closer inspection, you may find restrictions. One of the biggest restrictions says something like this, “…subject to credit approval from XYZ Finance and open to very well qualified buyers only.” This means you need a high credit score, typically at least 700, but maybe 750 or 800 or more. Know your score before you shop: you can get a rough estimate of your current score by visiting CreditKarma.com.

5. Research and shop online. The Internet has made it easier for shoppers to purchase a car. Dealers share their inventory online and the vehicle you want can be viewed thanks to numerous photos and usually a video. If you see something you like, then reach out to the dealer. Arrange a test drive only when you’re ready, but don’t wheel and deal at the dealership. Do all your negotiating online and check out other dealer inventories. This also means knowing what vehicle you want — down to the make, model, and trim level.

6. You’ll make more money selling your trade privately. Yes, I know: selling a car to a private party is a pain! It can also prove dangerous if you’re alone and don’t know the person coming to your home to test drive the car. That said, if you can sell privately, you’ll likely fetch more money than you would get from the dealer. Regardless, when deciding on a purchase price for a new vehicle, don’t discuss the trade-in until AFTER you make a deal. Sales staff love to confuse things by bundling both transactions under one deal. You’ll lose money if you allow this to happen.

7. Don’t wait as deals disappear and inventories shrink. The sooner you can make your purchase decision, the better. Dealer inventories on outgoing model year vehicles are dwindling. Incidentally, these vehicles typically have the best offers. If your schedule is so full and you can’t seal a deal before Christmas, the week between the Christmas and New Year’s Day holidays can work, especially if you’re looking for a new model year vehicle or a late model used car.

Let’s Make a Deal

Buying a vehicle should never be rushed! Avoid as much pressure as possible — sales staff are wheeling and dealing — their bonuses rely on making a deal. To them, you’re a deal just waiting to happen. Be prepared for an emotional onslaught.

If you’re purchasing a late model used car, insist on a vehicle history report. Even then, they’re not comprehensive or perfect. (Here is an excellent article that details the limits and sometimes the pitfalls with vehicle history reports — Limitations and Problems with Carfax or any Vehicle History Report).

Know what warranties are offered (e.g., the balance of the new car warranty, powertrain, and corrosion) and any special guarantees with your vehicle.

Finally, there’s nothing wrong with taking a friend with you when you purchase a car, especially if you are single. Not all dealers “get” women, with some sales staff directing their conversation to the man, even if it is the woman making the deal. That’s one more reason why it is important to get your final price in writing online BEFORE heading to the dealer, then telling your dealer contact that you’re the one he or she must talk with, not the individual with you.

8 Steps to Buying a Used Car

August 18, 2017 by admin 4 Comments

How to drive a deal on your next used car.

Buying a used car has its advantages as the steepest depreciation costs for new cars come during the first few years of ownership. Used cars come priced to reflect steep depreciation, are generally cheaper to insure then new cars, and often come with the original warranties.

Take the following eight steps to help you find a used car that you want and can afford.

Step No. 1 — Identify Your Style

Nissan Versa Note used car — Nissan Versa Note

Choose a used vehicle based on your needs. Quite easily you can find a “great deal” on a model that you may not want, including a gas-guzzling SUV such as a Ford Expedition. Then again, that low-cost subcompact Nissan Versa Note may be too small of a car to suit your needs. Understand your reason for wanting a certain type of vehicle.

If you have a family, a sedan or a crossover might be the logical place to begin your search. Narrow your list to a certain vehicle size, such as a midsize sedan, and attempt to restrict your search further to a specific make/model vehicle. Visit sites such as Consumer Reports, Motor Trend, and Edmunds to read product reviews and to obtain pricing information.

Step No. 2 — Establish a Budget

Your desire may be for a luxury sedan, but your wallet may tell you that you can afford a mainstream family sedan, such as the Ford Fusion, Kia Optima or Toyota Camry only. Determine what you can afford and make your plans accordingly.

Learn what the prevailing prices are for a particular vehicle by visiting Kelley Blue Book (KBB). Compare KBB’s dealer and private party sale prices with Internet car ads found on Craigslist and eBay. Know that used car pricing will vary depending on several factors, including mileage, trim level, vehicle condition, and location.

Ford Fusion Hybrid used car — Ford Fusion Hybrid

Step No. 3 — Arrange Your Cash or Apply for Credit

Unless you have enough cash on hand to purchase a used car, you will rely on credit to finance your transaction. A used car dealer may offer to finance your loan, but you can typically find better rates by shopping around.

The logical first place to look is where you currently do your banking. Banks and credit unions provide financing, with some financial institutions offering loans on vehicles up to 10 years old. Get quotes from at least three lenders and know that both your credit score and repayment ability will be big factors in determining your creditworthiness.

See: Federal Trade Commission: Understanding Vehicle Financing

Step No. 4 — Know Your Market

Porsche Cayman S used car — Porsche Cayman S

Choose an uncommon model such as a hard to find coupe or gas-sipping compact and you will find the pickings slim and your cost may come in higher than anticipated. Select a popular model such as the Hyundai Sonata and your choices may prove greater and the prices fairer.

Some vehicles do not fare well outside of certain markets. Convertibles such as the Chrysler 200 are popular in Sunbelt states while four-wheel-drive SUVs are most desired in areas where winter weather and tough terrain prevail. Then again if you want a pickup truck and live in New York City you may find a seller eager to unload a vehicle with few takers.

Step No. 5 —Search For a Car

Consider both private party sellers and used car dealers when shopping for a car. Generally, you will pay less when buying privately, but with a used car dealer you may get a warranty on top of the balance of the manufacturer’s warranty.

Buying from a dealer may be the best option for you if you want a certified used car. Such models must meet rigorous guidelines instituted and backed by the manufacturer. Typically, cars no older than two or three years old qualify, but some manufacturers back cars up to five or six years old.

You can also check the fleet inventories of major car rental companies such as Hertz, Budget, and Enterprise. Although such vehicles are often driven hard, they’re also usually very well maintained. You may find a bargain and still get a warranty with it.

See: MSN Autos: Survival Guide to Buying a Used Car

Dodge Charger SE used car — Dodge Charger SE

Step No. 6 — Test and Inspect

Once you find a car that is of interest to you, take it for a test drive. Keep the audio system off and listen for how the engine turns over, the transmission engages and how the brakes react when you come to a hard stop. Have the owner show you how various technological features work, including the audio and navigation systems, climate control, sunroof and other electronic amenities.

Inspect the car carefully, looking for signs of wear and tear or concealed damage. New carpeting may hide rust while hazed over headlamps in a newer model could signal water damage. Ask the owner for repair records and invest in a vehicle history report. (Here is an excellent article that details the limits and sometimes the pitfalls with vehicle history reports — Limitations and Problems with Carfax or any Vehicle History Report).

If possible, take the car to your mechanic to have it evaluated. He will tell you what problems are present, if any.

See: Accuweather: Thousands of Water-Damaged Cars May Hit the Market in Wake of Texas Flooding

Step No. 7 — Make An Offer

Your earlier research can pay off when it comes to making an offer for a vehicle. KBB research may give you a price very close to what any vehicle is worth, enabling you to negotiate from a position of strength.

Know that if the owner has priced the car according to the information she uncovered herself, you may have little room to negotiate. Still, offer a reasonable price and wait for a counteroffer. Find a common ground where you both can declare victory and you’ll have a deal.

See: ABC News: Haggling 101: How to Set the Opening Offer for a Used Car

Step No. 8 — Complete the Deal

The last step for sealing your used car deal is to make your payment. If you have a pre-arranged loan, your dealer will handle the paperwork including the contract. For a private party deal, your lender may issue you a check for the amount due. Cash deals are best handled by signing a contract and obtaining a receipt.

Have the title signed over to you by the owner. Take your car to the department of motor vehicles to have it registered and a new title issued. If there is a lien on your car — that is, you took out a loan — the lienholder’s name will appear on the title retained by the lender. Register your car, pay the required fees and taxes, and obtain new tags. Contact your insurance company to insure your vehicle.

(See Also — How to Resolve a Private Seller Lien)

Accomplish Each Step Carefully

Never rush into a car purchase, whether buying used or new. Likely, you will keep your car for a long time, therefore complete each step carefully to get the model that is right for you.

See Also — How to Resolve a Private Seller Lien

Personal Finance Disaster: Car Title Loans

May 26, 2016 by admin Leave a Comment

How to lose your transportation the auto title loan way.

You own your car outright and have possession of the title. At the same time you’re pinched financially and could use some cash. You’ve heard about car title loans and find yourself lured by promises of quick cash.

What could go wrong here? A little emergency money can tide you over, giving you the opportunity to handle other pressing financial matters.

Seized Vehicles and Other Matters

Unfortunately, car title loans — also known as auto title loans — are not the solution to a financial problem. In fact, the Consumer Financial Protection Bureau (CFPB) found that one-in-five auto title loan borrowers have their vehicle seized. And without wheels, you may find yourself facing worse problems — no way to get around, including to your job.

On the surface, a car title loan may not sound like a big deal as it provides you with a small amount of money for a short period of time, usually 30 days. In exchange for cash, you hand over the title of the car to the lender and pay a fee for the loan. Loan rates are extremely high — as much as 300 percent annually or 25 percent for the month. Thus, if you borrow $1,000 you may need to pay back $1,250 in one month.

“Our study delivers clear evidence of the dangers auto title loans pose for consumers,” said CFPB Director Richard Cordray. “Instead of repaying their loan with a single payment when it is due, most borrowers wind up mired in debt for most of the year. The collateral damage can be especially severe for borrowers who have their car or truck seized, costing them ready access to their job or the doctor’s office.”

Reborrowed Loans and a Debt Pit

Besides the high rate of repossessions, there are other problems the CFPB found with such loans:

1. More than four-in-five auto title loans are reborrowed on the very day they are due. That’s because borrowers cannot afford to pay them off with a single payment.

2. Auto title loans become long-term debt. Because borrowers experience difficulty paying off their loans, the CFPB found that more than half of auto title loans become long-term debt burdens. In this case, borrowers take out four or more consecutive loans in an effort to pay off their debt and avoid repossession. Besides the outstanding loan amount, borrowers are hit with additional fees, worsening their debt.

3. The borrowing doesn’t stop. More than two-thirds of car title loans are obtained by consumers who take out at least seven consecutive loans and remain in debt for the better part of the year.

Small Loans, Big Burdens

The CFPB report examined approximately 3.5 millon, single-payment car title loan records from 2010 to 2013. The bureau focused only on non-bank lenders; consumer’s personal details were redacted.

The average amount borrowed for such loan is $700 and the typical interest rate charged is 300 percent annualized. Such loans are allowed in only 25 states — 20 of the states permit lenders to collect a single, full payment at the end of the loan term. Five other states require installment payments.

The CFPB study noted that car title loans and payday loans are similar as both charge exorbitant interest rates and include high incidences of reborrowing. In effect, consumers are ensnared in a long-term debt trap, and are at great risk of losing their cars.

Explore Other Options

So, how do you avoid the car title loan trap? By not agreeing to one in the first place. If you are that pinched for money, consider other sources — just don’t put your ride in jeopardy. Can you afford to do without a car? Probably not. Losing your car can change your life and in ways you may never imagine.

See Also — Car Repossession and How to Avoid It

Public domain photo supplied by Jelson25.

Car Insurance for the Poor? Good Luck With That.

February 9, 2016 by admin 2 Comments

Renters may pay much more for their auto insurance coverage than do homeowners.

If you’re a low-income individual, more than likely you rent your home and don’t own it. Even if you’re a good driver, obtaining affordable car insurance is more costly for renters, than for homeowners, a fact recently uncovered by the Consumer Federation of America (CFA).

money tussle Indeed, in a press statement released on Monday as well as in an accompanying media teleconference, two CFA representatives — Bob Hunter, Director of Insurance and Doug Heller, Insurance Consultant — articulated just how much more the renting poor may pay for their auto insurance.

Higher Rates Even for Good Drivers

CFA research was conducted to determine what those differences might be, finding that renters pay 7 percent per year more on average than homeowners. That translates to $112 annually, not a small amount for people of limited means.

Auto insurance companies have long used home ownership as one criteria for determining rates. Other factors may include an individual’s credit score, zip code, education, occupation, the type of vehicle driven, and driving record. Thus, consumers not only pay more for their auto insurance because they rent, but likely far higher than that when other factors are taken into consideration by insurers. By the way, uninsured motorists comprise one of eight drivers in the US, according to the Insurance Information Institute.

Renters already carry a burden when it comes to their finances. According to 2013 Federal Reserve Bank data, the average annual income for renters in the US was $27,800 compared with $63,400 for homeowners.

“To raise people’s auto insurance premium because they can’t afford to buy their homes unfairly discriminates against lower-income drivers,” said J. Robert Hunter, CFA’s Insurance Director and the former Insurance Commissioner of Texas. “A good driver is a good driver whether she rents or owns her home. Insurance companies should not be allowed to target people based on homeownership status.”

Minimum Limits Liability Coverage

The CFA surveyed minimum limits liability coverage in 10 cities scattered across the United States and chose the seven largest insurers for the analysis. The seven insurers were: State Farm, Geico, Allstate, Progressive, Farmers, Liberty Mutual, and Nationwide.

To determine the insurance rate, the CFA utilized each company’s website to acquire two premiums in each city for a sample 30-year-old female motorist with a perfect driving record and a 2005 Honda Civic to insure. Both premium inquiries were identical, save for one category — whether she rented her home or owned it.

While most of the increases for the renter came in single digits, there were several outliers that raised rates by double digits, including by 47 percent for Liberty Mutual customers in Louisville, Kentucky. In effect, the sample owner of the Honda Civic would have been charged $768 per year more than had she owned her home.

Notably, Liberty Mutual was far more likely to charge renters more for their auto insurance than any other company, tacking on $307 per more per year on average. On the other hand, Geico did not use homeownership as a criteria for renters, thus rates for renters and homeowners were the same. Curiously, Allstate actually provided renters with lower insurance rates than for homeowners in Chicago, coming in at 11 percent lower.

The CFA provides a pair of tables showing the annual premium charges in total dollars and percentage by company in each of the 10 cities. The organization also checked rates in an eleventh city, Oakland, California, confirming that auto insurance rates for homeowners and renters were the same. That’s because California law prohibits insurers from setting rates based on home ownership, something the CFA would like to see the other states follow.

Advocating for the Poor

“Using customers’ homeownership status to determine premiums is another way in which insurance companies are piling on lower-income Americans,” said Douglas Heller, a consumer advocate who worked with CFA’s Michelle Styczynski to analyze the data in the study released today. “With all these different rating factors that have nothing to do with driving, auto insurers are charging good drivers hundreds and sometimes even thousands of dollars extra just for being poor.”

Hunter concluded that while people may have a choice whether to own or rent a home, they aren’t given that choice when it comes to purchasing car insurance. “State Insurance Commissioners and elected representatives should step in and stop this practice,” said Hunter.

The CFA representatives concluded by stating they plan to forward their findings to each state’s insurance commissioners and urge them to eliminate the gap between homeowners and renters.

Charts and date courtesy of the Consumer Federation of America (CFA).

Rip-off Report: $6,391 in New Car Warranties

August 13, 2015 by admin 1 Comment

Buying a new car is a hassle, with more than half of all buyers surveyed indicating that they consider car salespeople “untrustworthy” according to research from DMEautomotive (DMEa). That lack of trust is also higher with women as many ladies believe that they are being taken advantage of when negotiating a new car deal.

Recently, a good friend purchased a 2015 Toyota Corolla from a local dealership. That deal was conducted with her daughter and son-in-law present. No trade in was conducted and my friend managed to save a few thousand dollars by negotiating a lower price and obtaining a few cosmetic upgrades at no additional cost.

It all seemed like a good deal until the dealership’s business department got involved. That’s when said customer was talked into buying no less than five warranties, including a costly extended service agreement that added $6,391 to her final price, state sales tax included.

For the record, I received permission to share my friend’s story with our readers in a bid to warn others what can go wrong when buying a new car. In this case, things went terribly wrong, but there is some good news to report as well: with some special work, all five warranties were rescinded. Yes, there was pushback on the dealer level as each high-profit warranty was contested. It took repeated phone calls and visits to the dealer to get the charges reversed, something you can do if you are similarly tagged with pointless new car warranties.

New Car Warranties

Before we look at my friend’s story in detail, new car shoppers should consider a few points when buying a vehicle.

First, all new cars come with standard warranties. Typically, you receive a bumper-to-bumper warranty for at least the first three years or 36,000 miles, whichever comes first. This means you are covered for anything that can go wrong with your car beyond the general maintenance. Sure, there are a few things that may not be covered and you may still be responsible for some repair costs, but for the most part those expenses are covered by the manufacturer.

Second, all new cars come with other warranties. If your car’s exterior shows signs of rust, the manufacturer will fix the problem at no charge to you. Rust warranties typically last from five to 12 years. Further, most do not have a mileage limit. This means if you drive 200,000 miles in five years, you would still be covered.

Third, new cars also come with powertrain warranties. Perhaps most worrisome for new car buyers are failed parts. Especially major components such as the engine and transmission. After all, if one of these parts fail, you’re looking at repair bills of several thousand dollars. Fortunately, warranties of five years and 60,000 miles are common. Some manufacturers, such as Hyundai and Kia, offer 10-year, 100,000-mile powertrain warranties.

Beyond the Standard Warranties

My friend had not purchased a new car in 15 years. Her previous ride was a premium Japanese make, a model that gave her no major problem. Typically, said friend drives just a few thousand miles each year — her old Acura had barely passed the 50,000-mile mark when she began shopping new.

But like so many other buyers, she was worried that her new car might eventually cause her problems. That worry became evident once she and her family members were sitting in the business office discussing warranty options. Despite her family telling her to not buy the offered warranties, she went ahead and did so. This was easier to do when the business manager said that she “could cancel at any time.”

Right there, a big mistake was made: although the warranties could be canceled, getting it done required multiple phone calls, personal visits to the dealership, and not a little angst. Had she delayed canceling, her warranties would have been pro-rated. This means she would receive a refund minus the time already used.

Warranty Considerations

Personally, I am not against special warranties completely. Cars that have a so-so repair history might benefit from an extended warranty. But that begs the following question: why would you buy any vehicle with reliability problems? It just doesn’t make sense and it may cost you much in time, money and aggravation.

See Also — 7 Types of Car Warranties

How to Turn in a Leased Vehicle Early

July 17, 2015 by admin Leave a Comment

leased vehicle

Accentuate the positive when taking pictures of your leased vehicle.

You leased a new vehicle and now have regrets. Or, perhaps your needs have changed and you want a different vehicle. Regardless of your reason for wanting to get out from underneath a lease, you may find that the lease contract isn’t exactly written in your favor. Even so, there are ways you can turn in a leased vehicle early and without losing your shirt.

Sell the leased vehicle. You don’t own the lease vehicle, but if you find someone willing to buy it, then you can take the proceeds from that sale to cover the lease buyout. As easy as this sounds, it is also difficult to do, especially if you only recently began to lease the vehicle. In this case you may have to cover the deficiency to end the lease contract. It may be worth it to you if you don’t want to be saddled with monthly lease payments and maintenance costs.

Buy the leased vehicle. If selling the leased vehicle and using the payment from the new owner to pay off your loan sounds a bit complicated, another alternative is to simply buy out the vehicle yourself. Once you take ownership you can find a buyer apart from the leasing company’s involvement. Again, you may take a financial hit here, especially if you cannot find a buyer to match what you paid the leasing company.

Nissan Altima leased vehicle.

A three-quarters view of the front should be included in your ad.

Trade the leased vehicle in for another one. It is possible to get out of a lease by agreeing to take on a lease for a new vehicle. Or to purchase another vehicle. In some cases, the manufacturer will work with you, allowing you to trade your vehicle in to step up to another model. For example, if you own a sexy sport coupe and need to buy a crossover to accommodate your growing family, you may be able to make that transition without penalty. Just make sure that there are no fees charged for the early turn in.

Find someone to take over payments. You can get out from underneath a lease if you find someone to take over your payments. This may be possible if your lease amount is reasonable and someone needs a car for the short term. You can try to find someone on your own or use a service such as LeaseTrader.com or SwapALease.com to list your vehicle. This service is not free — you will have to pay an ad charge, a listing fee or both. Furthermore, your leasing company may charge you a transfer fee.

Return the vehicle to the dealership. Quite frankly, you have had it. You haven’t been able to sell your vehicle or find someone willing to take over payments. As it stands, you cannot afford the car and you worry that you will fall behind on payments and that it will be repossessed. In this case you can return the vehicle to the dealer, pay the early turn in penalty and make your outstanding payments. Doing this will help preserve your credit. That’s better than incurring a repossession or experiencing some other adverse action will harm you.

Hyundai GDI Engine.

Lift the hood and show buyers your beautiful engine.

Leased Vehicle Marketing

Prior to marketing your vehicle for sale or for lease take over, you want to make it look as pleasing as possible. If the tires are worn, then replace them. Nicks and scratches should be addressed, something that can be accomplished through detailing. It may be a worthwhile investment to employ the services of a professional to whip your car into shape.

Lastly, take pictures of your car, including three-quarter front and rear views as well as a profile picture. For the interior, concentrate on the seats, the dashboard and other cabin highlights. Lift the hood and capture the engine bay. Likewise, focus on the trunk. These photos will be included with your online advertisement.

Certainly, getting out from underneath is not an easy task. But with determination you can find the best option for you.

How to Snag a Year End Car Deal

December 28, 2011 by admin Leave a Comment

You can save money on a new car.

The calendar year is officially drawing to a close and that means one thing: year end car deals can be had. Why such an emphasis on pushing more metal out of dealer showrooms at this time of the year? Bragging rights, mostly. Auto industry executives are seeking to demonstrate to everyone, especially their shareholders, the health of their respective brands.

A year end sales bump can spell the difference between finishing in first or trailing the market leader in a certain category such as luxury car sales (BMW v. Mercedes-Benz) or as the best selling car (Toyota Camry v. Everyone). Such laurels are then transformed into a sales tool by marketing professionals for many months to come.

Industry year — When the clock strikes midnight on New Year’s Eve, the year comes to an end, right? Yes, but not for the auto industry. The industry’s reporting calendar differs, however. Instead of ending on Dec. 31st, the calendar goes past New Year’s Day and typically ends one or two days after the New Year. In 2011 and in 2012, the year’s sales will include the first three days of the new year. That means only after business closes on January 3, will the official reporting year come to an end. Year end sales end at that later date too, not on Dec. 31.

Open New Year’s Day — While mostly everyone else is sleeping in on New Year’s Day, new car dealers will be keeping dealerships open throughout the day on Jan. 1. In 2012, New Year’s Day is a Sunday, therefore some dealerships will stay closed as is customary for them. Others will open late and stay open late. In any case, you may be able to negotiate a deal on a new car just as every one else is waking up or watching football.

Loan options — Head to your bank or credit union days before the end of the year to negotiate a loan deal. Although your new car dealer is more than happy to arrange financing for you, you may find that your banker has a good deal available for you too. Having financing arranged in advance removes one less component from the negotiating process. Besides, if it comes down to taking the sizable rebate v. low-rate financing, your approved bank loan can allow you to apply that rebate to your down payment.

Research matters — It is easy to get caught up in the year end rush to buying a new car. As always, being thorough in your research can assure you that you get the car you want at the price you want. That means spending enough time reading up on your vehicle, taking a test drive, comparing prices for dealers and perhaps allowing dealers to bid to sell you a car. One site, CarWoo makes dealer bidding possible. We’re not endorsing this business model, rather we’re alerting you to it.

Leftovers and end of model bargains — Not too long ago, the next model year’s vehicles would begin to show up in dealer showrooms sometime in September for an official october launch. These days, new models are rolled out throughout the year which means that some cars on dealer lots are already one model year old. You’ll almost always find the best deal on the outgoing model year as well as on cars that have been discontinued. In 2011 several models have been ended as well. The Dodge Caliber, the Ford Crown Victoria and the Buick Lucerne are among the cars that have been canceled. If you don’t mind buying a car that is no longer being produced, you should be able to negotiate a good deal. You’ll still enjoy the manufacturer’s new car warranty and support for many years.

A word of caution: not every model or every car comes with an extra special year end bargain. Check with an independent site, such as Consumer Reports for recommended buys. You’ll have a tougher time striking a deal if the model is popular and in short supply.

See Also — How to Lease a Demo Car

How to Save Thousands on Your New Car

June 23, 2011 by admin Leave a Comment

New car prices continue to rise with the average cost of a new ride costing about $30,000. That is quite a lot of money for a purchase that will lose value the moment you leave the dealer lot and continue to slide for many years to come.

Few of us can do without a car which means finding ways to have a vehicle we want or need, but at price we can afford. Fortunately, there are some excellent options out there for the car shopper, so let’s explore what they are.

Lease New — Buying a new car means you’ll have to put down some money and make payments for three, four or five years…maybe longer. When your car is finally paid off, you’ll be left with a vehicle that will need increasing amounts of maintenance and repairs. Worse, it will be old. That’s why leasing is an excellent option for people who want a new car every three years and want to avoid paying for major repairs. Not all leasing deals are great, but some models require small down payments and reasonable monthly payments.

Lease Used — People who lease sometimes find that they can’t or don’t want to keep a car until their contract has ended. A divorce, job relocation or a need to get a larger car to accommodate a growing family may be some of the reasons why people will want to get out from underneath a lease. Services such as Swapalease.com and LeaseTrader.com have emerged, bringing car shoppers and leased vehicle lessees together. Under this arrangement, you can take over a lease and may avoid paying the residual fees already covered by the lessee, saving you hundreds, even thousands of dollars in costs.

Certified Used — You can’t afford the new car, but you may be able to afford a car that is used, perhaps a year or two old. These vehicles are snapped up by car dealers who know that they present a good value to customers and a source of profit for the dealers. Get a fairly new car that still has a warranty with it and one that has been priced to reflect the depreciation taken over its first year or longer.

Close Out — The best values on any new car lot are those vehicles that are slow sellers. Among the cars hardest to move are the previous generation models, especially as the next generation cars come to the market. If you can live with yesterday’s technology and engineering, which may not be so out of date anyway, then you could find a bargain, one with special rebates and other incentives offered to help move old stock. Examples of cars that fill this description are the Ford Focus, Honda Civic, Hyundai Elantra and Dodge Charger. Models slated for change in the coming year include the Toyota Camry, Chevrolet Malibu and Honda Accord. Models slated to be discontinued include the Buick Lucerne, Cadillac DTS, Dodge Caliber and Ford Ranger.

Hot Incentives — Incentives are one way car manufacturers move iron, with some deals designed to offer far better bargains than others. Typically, the best deals take place toward the end of the model year or calendar year, with rebates ranging from $500 to $3,500. Add in other incentives such as military rebates, recent college grad and loyalty rebates and the savings can prove significant. Shop around too — dealers in your area may offer additional specials, particularly on a trade in.

Considerations

Before you buy any car, contact your auto insurer. You may find that your insurance costs will rise by hundreds of dollars, effectively eating up your savings. Some models, particularly those that test well with the IIHS, are insured for less. Know what all of your costs will be before making a purchase decision, avoiding a surprise that goes beyond sticker shock.

Resources

LeaseTrader.com: Home

SwapaLease.com: Home

AutoTrader.com: Home