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So my husband and I have never had to "buy" a car. We've been very fortunate. We both received cars from our parents in college and we've made them last (well, I've since gotten a new car, but it's a company car so I didn't pay for it.)
However, H needs a new car for a variety of reasons. We will be trading in his current car, a 99 Ford Mustang in excellent condition w/ 90K miles and getting him something different, probably a Ford Explorer. Cars aren't a priority for us, we know they're not investments and it's just not where we choose to put our money. So used will be just fine! That said, we drive our cars until they absolutely need to be replaced, so we want a reliable car. We need a SUV (kids and large dog) and have no problems w/ domestic cars. He also doesn't put a lot of miles on his car.
Since we've never done this, I have so many questions. Is it better to trade in his car for a different car and pay the difference? Or attempt to sell it privately?
A car payment makes me want to cringe... we might be able to pay the difference in cash, but it would deplete our savings. Where do we begin shopping around for financing? fwiw, we both have excellent credit. What about 0% interest? Does this ever apply to used cars?
When looking for a new (used) car, is it better to go to the big dealerships (CarMax)? Or check out the smaller, local ones. What about buying privately (Craigslist, newspaper ad?)
Please share any tips/advice you may have. This is a road we've never been down and we'd like to be as educated as possible.
problem with buying used cars from private parties is you have no guarantee but their word unless you get the vehicle inspected. you can get a service contract at places like carmax and regular dealerships that sell used cars along with the new vehicles.
typically you can (try to) sell a car for more than a dealership will give you for it because dealerships want to make a profit on the vehicle when they resell it. so if you sell a car to the dealership that would resale for about 10000, they may give you 8000.
when we bought our suburban (used) we had a credit card offer us a 0% deal with a cash advance. We were lucky to have most of the money saved up and only financed 6k on the 0%. My dh kept trying to pay extra on it but I wouldnt let him because of the fact it was "free money". Although we did stick it in savings just in case they changed the aggreement so we could pay it off. IF you get a good deal like that it is not a bad idea. We also had a trusted mechanic that looked at 10-15 suburbans before he gave us the thumbs up on the one we have.
sometimes you can get 3.9 or 4.9 loans from credit unions. The mustang is typically a car that should sell pretty fast if it is in really good condition. I would reccomend selling it yourself.
Do a little research first with Kelley Blue Book. That'll give you an idea of what to expect in value. There are three fields, trade-in value, suggested retail and private party value. These should be close provided you were honest in your vehicle's description. It also might be an eye opener in that you might think the car's worth 10K and the best it shows is 5K in value.
Clean it top to bottom, inside and out. Change the oil and tidy up around the engine compartment. New car smell in a can never hurts either. The goal is to try and make it look as good as possible, as if you've taken care of it. A private buyer or a dealer will perhaps consider making a better offer.
Just be careful when the dealer makes the offer. Too many times a higher value given to your trade is an illusion. With that, go back to Kelley Blue Book and do some solid research on the vehicle you want. What's the average price in your area. Make sure you have the model and options right, that will throw it off. If you see an Explorer you like, the price is in the "suggested retail" range and it checks out mechanically, you've probably found something you'll like and feel good about.
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