Car Buying Tips

Be A Smart Car Buyer. Negotiate the best deal on your next car purchase.

If you’re like many people, you may find the car buying and car loan process confusing and intimidating. Sales people are sometimes aggressive, and they may use car buying and car loan terms you’re not familiar with. And unless you’re a math whiz, it can be difficult to tell exactly how much you’re really paying.

So BlueSky Auto Finance put together this convenient car buying tips guide to explain how the car buying process works, provide new and used car loan tools that will help you make smarter choices and to de-mystify the car buying process so you can be more confident when negotiating your next car purchase.

1. Understand Your Car Loan Options

Auto dealerships often treat a car loan as an afterthought. They’d rather sell you a car first, and then discuss car loan terms later. However, that approach puts you at a disadvantage and it often results in buyers agreeing to finance terms that aren’t right for them. So here are some car buying tips for getting the right car loan for you.

2. Know Your Credit Score

The first step in applying for a new or used car loan is to get a copy of your personal credit score. Knowing your credit score will help you better understand how to get the best car loan possible. If you discover any incorrect negative information, contact the major credit reporting agencies – Equifax, Experian and Trans Union, and request to have it removed. This is one of the most important car buying tips. Get your credit score now!

3. Know Your Budget & Car Loan Payment Limitations

Before you apply for a car loan, it’s essential to know exactly how much you can afford to borrow, and what your monthly payments will be. To make it easy to determine your budget, BlueSky Auto Finance offers two convenient tools: A Car Loan Payment Calculator and a Car Loan Amount Calculator. Using our car loan calculators, you can easily determine what kind of car you can afford.

4. Understand the Components of Your Car Loan

One of the most important car buying tips that will save you lots of money is to remember that apart from those items described as “govt. fees,” above, all other car loan components are negotiable. Whether you get a car loan through BlueSky Auto Finance or through a dealership, always review and understand each point on this list.

Don’t become so preoccupied with your interest rate or monthly car loan payment that you agree to a higher vehicle price or additional products such as service contracts or other “back-end” products that you may not want or need.

5: Shop Around For A Car Loan

Although car loan companies have tightened lending standards, car financing options are available to most consumers that aren’t limited to loans offered through auto dealers. Today, there are many car loan sites offering a range of new and used car finance solutions.

Online car loan companies offer some of the most competitive APR’s in the market, because their loans are not “marked-up” like dealership car financing. Additionally, to be certain you get the right car loan, you may also want to visit your local bank and research their car finance options or your credit union if you belong to one. The more you shop around, the better your chances of getting the best deal on a car loan.

6: Choose the right car for you.

When it comes to picking a car, knowledge is power. With so many car research tools and information available online, there’s almost no need to visit a car dealership until you’re ready to take a test drive. Sites like yahoo!,,, and put a full range of data about both new and used cars right at your fingertips.

You can compare features, prices, and quality ratings right from your home computer, helping you narrow your search to two or three models before you set foot in a dealership.

Read these car buying tips when shopping for a car:

New Vehicle Value. Research the Manufacturer’s Suggested Retail Price (MSRP) and then actual dealer cost – dealer invoice less any factory rebates and incentives. If you know what the car dealer actually paid for the vehicle, you can then negotiate your price more effectively by offering them a certain amount of money over cost.

Used Vehicle Value. Many factors can affect the value of a used car, including mileage, condition, and the published Kelly Blue Book or NADA book estimated value. There are many places to go when considering a used vehicle – you can research local car dealerships online, yahoo! autos,,, and to find a used car and get a good idea of availability and pricing.

Vehicle History. Avoid buying someone else’s problems by obtaining the background on any used car you want to buy through This report will tell you whether a car has been in an accident, a flood, or whether it has had any other major repairs.

Trade-In Value. Dealerships are in the business of selling cars—not buying them. So be prepared for the dealer to offer you wholesale book value, or less, depending on your car’s condition, make and model. If you have an older car, trading in to a car dealer might make sense because it’s convenient and you most likely wouldn’t get much more for it if you sold it private party. Again, research the value of your trade-in at sites like or prior to negotiating with a dealership.

If you want top dollar for your car, sell it privately. If you don’t want the hassle of selling your car, trade it in. But if you want to get the most for your current car, consider selling it private party. You’ll need to make sure all the necessary paperwork for transferring ownership is completed but it may be well worth it particularly if you own a popular car. You can list your car for sale free on several websites including, and

Crash Test Results: The National Highway Transportation Safety Administration (NHTSA) publishes the U.S. Government’s official results of crash tests for all vehicles. Be sure to review the safety performance of any car you’re considering.

Vehicle Insurance Cost. Before you purchase a new or used car, get an estimate from multiple car insurance companies so you have a better understanding of the total cost of ownership. You may be surprised to learn that different cars can result in much different car insurance rates.

Service Contract. This is a particularly important consideration when purchasing a used car and on a new car depending on your driving and ownership habits. Either way, if you decide to get an extended warranty, make sure it’s backed by the manufacturer (if possible), is good at any one of their dealerships, only requires you to pay non-covered out of pocket expenses and is transferable. Additionally, these are negotiable so make sure you ask for a discount from the dealer. You could save 30 to 50% from their asking price.

7: Negotiate Your Price & Get Your Car

Okay—you’ve secured your car loan, done your research, and chosen a car that fits both your budget and your practical needs. It’s time to contact a dealer and begin negotiating price. Many auto dealerships have internet departments that will provide a price quote via e-mail. Start by contacting a local dealer through, or and request a price quote or, go directly to a local dealer’s website.

You’ll find it’s possible to save hundreds if not thousands of dollars from the MSRP before ever stepping foot into a dealership showroom. Next, go to the dealership, take a test ride, compare car loan terms and drive home in your next new car! We hope you found this section on car loan and car buying tips helpful.