How to Save Money on Car Payments

Use these tips to learn how to save money on car payments

If you’re in the market for a new car, one of the big questions on your mind is how to save money on car payments. Nothing takes the thrill out of a new car like a huge monthly bill. If you want a new car with the lowest possible payments, follow these tips.

1. Start with a low price

Getting your new car for the lowest possible price may seem like a no-brainer, but there are some things you need to know to be able to pull this off.

2. Never pay sticker price

Learn what the dealer paid for the car and pay as close as possible to that price. How do you find out what the dealer paid? You’ll know what the dealer paid from the dealer-invoice. Subtract dealer sales incentives and the holdback amount from the dealer-invoice price and you’ll know exactly what how much money the dealer has in the car.

If you’re sure of the car you want, purchase a New Car Report that tells you exactly what the dealer paid. The cost of this report is $14.

You can also visit PriceQuotes, Yahoo Autos, and Edmunds for free information about dealer invoices.

3. Shop for financing

Before you go to the first car dealer, do some shopping for your financing. Check interest rates at local credit unions and several local banks to see who will give you the best deal. By having your financing lined up, you won’t end up negotiating the financing while you’re trying to get the best price for your new car.

Negotiating the price of the car, financing, and trade-ins, is a tactic car dealerships use to get out of paying the lowest possible price for your car. If you have your financing arranged, this is one less thing to distract you from getting the best price on your new car.

4. Don’t be tempted

Getting a new car is fun and it’s natural to want to get the most bang for your buck. Be wary of salesmen when they start showing you the ‘extras’. Most of the time you don’t need fabric protection, rust proofing, paint protection, or VIN etching. These extras sometimes don’t seem to cost much, but add them to the amount you’re financing and it eases your monthly car payment up.

Now you know how to save money on your car payment. Stick to your guns and follow these tips. By knowing what the dealer has in the car, shopping ahead for financing and avoiding temptation when it comes to extras, you can get the lowest possible car payments.