7 Car Buying Tips For The New Year

2010 is here and it will be a dandy. At least that is what most of us hope for a year which also begins a new decade: the tens. The auto industry was torn asunder in 2009, with Chrysler and General Motors both filing for bankruptcy and guided through same, while mostly every other car manufacturer recorded double digit losses for the year.

Consumers are buying, but in much lower numbers than when the last decade began when 17 million units were sold. This year, Edmunds.com has projected sales to increase above 11.5 million units with some analysts forecasting an even higher increase. No matter, car manufacturers want your business which means that the deals are still good, quality is constantly improving, and your options are bright.

Let’s take a look at 7 car buying tips for consumers this year:

1. Discounting Continues – You won’t see the discounts of early Spring 2009 when dealers were dropping new car prices by $5-10K on select slow selling models. But you will still be able to find discounts on most models or receive cut rate financing. As always, try to come up with the best financing deal elsewhere and take the manufacturer’s rebate if you are given that choice.

2. Orphans Aplenty – Pontiac and Saturn are being pushed into the history books, but many 2009 models remain unsold. Dealers are snapping these cars up and are reselling them to consumers for ultra low prices. But be forewarned: their resale values will stink and these discounts may not match what these cars are really worth. Still, if you plan on buying an orphan and keeping it until it dies, then this could be a good opportunity for you. Parts and service or warranty shouldn’t be a problem either.

3. Leftover Models – 2009 cars still on dealer lots should fetch a good deal, but you will find the best deal for cars which have made a generational shift. For example, the 2009 Ford Taurus is completely different from the 2010 Taurus, which means that if a dealer still has an ’09 languishing on its lot, then make an offer that cannot be refused. The Buick LaCrosse, Subaru Legacy, and Mercedes E Class are among the models which are all new for 2010. Ask yourself this: can you live with an aged 2009 design?

4. Chrysler Controversy – While GM appears on the mend, Chrysler may be a different matter. The automaker is ailing, with quality issues, and not offering much of substance beyond its Dodge Ram line. You can probably get a great buy on any Chrysler PT Cruiser and save money on the Dodge Avenger, but these cars are substantially below par. Call it Chrysler bashing if you want, but today’s new car buyers have to look at how things will be 4-5 years out, particularly a vehicle’s resale value.

5. Check Credit – If you are planning to finance your purchase either through a car loan or lease, your credit rating will make a big difference as to whether you will be approved for a loan and at what interest rate. Obtain free copies of your three credit reports at AnnualCreditReport.com and pay the small fee to get your credit score. Review your reports and correct errors as these mistakes can lower your credit score.

6. Wait/See – If you can wait until this summer, a number of electric cars will begin to show up on the market. They’ll be pricey, but they’ll also carry significant government rebates with them, green cars such as the Nissan Leaf and Chevy Volt. Then again, maybe paying $40K before rebate is a bit hard to swallow, which means that the Chevy Cruze and Ford Fiesta may be a satisfactory and affordable compromise for you.

7. Sell It – If you plan on trading in your car, do so only after you negotiate the best deal for your new ride first. Still, you will not get top dollar for your trade, which means that you should visit Kelley Blue Book to get a fair market price for your car, selling it on your own. Consider donating your car to a car charity as these organizations, which do much good, were hammered by last year’s CARS—Cash For Clunkers—program.

There is nothing better than the look, feel, and smell of a new ride. So do your research first and operate from a position of strength. Buy only what you can afford and consider holding off your next new car purchase until you find the right deal for you.

Adv. – If you’re planning to buy a new car, then you’ll want to get price quotes or find a dealer to arrange for a test drive. You may also want to arrange for your own auto financing which can save you hundreds of dollars on your next car loan.

Photo Credit: GM Corp.