Car Buying Articles

Eight Steps to Buying a New Car

Follow This Route for Car Buying That's Fast and Even Fun

  • New-Car Shopping: Fast and Enjoyable

    New-Car Shopping: Fast and Enjoyable

    Following's suggestions can save you thousands of dollars on a new car and make the shopping process more efficient and enjoyable. | February 21, 2014

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Car Buying Learning Center

The following steps will show you how to locate, price and negotiate to buy the new car you want. Using this information could save you thousands of dollars on a new car and make the process quicker and enjoyable. It also puts you in charge of the deal-making process — and that feeling of empowerment is a good one.

But first things first: You need to decide what car you want to buy. If you haven't done that yet, please check out our "10 Steps to Finding the Right Car for You." Then head back here once you have chosen the right car.

And if you have any questions along the way, please reach out to the Live Help team for free assistance. The team will work hard to make your car shopping experience the best one yet.

Step 1: Get Approved for a Car Loan
A powerful first step in the car buying process is to get approved for a loan. (If you have decided to lease your new car, things proceed a little differently, so please read "10 Steps to Leasing a New Car.") Getting approved for a loan from a bank, credit union or online lender will show you what interest rate you qualify for. If the interest rate offered is unexpectedly high, you will know that there are problems with your credit history that need to be resolved before you move forward. Getting approved in advance will also mean you can negotiate at the dealership as a cash buyer, which is much easier. You can still accept dealership financing, but getting approved before you even walk into the dealership will be the bargaining chip to get you the best interest rate.

Step 2: Price Your Car and Your Trade-in
Everyone knows that the price of a new car is usually negotiable. But how much of a discount can you expect?'s True Market Value (TMV®) pricing uses actual sales figures to reveal the average price buyers are paying for cars in your area. Edmunds TMV adjusts the price for other factors including incentives, options and color.

Using Edmunds TMV, you can see the price of the car you want to buy, and also the price of your trade-in, if you have one. Choose the make, model and year of the car you want to appraise and follow the prompts. TMV adjusts the new car price for the available incentives. TMV for your used car shows the current market value if you sell it to a private party or trade it in at the dealership.

While TMV already factors in incentives, it is also possible to separately review the latest incentives and rebates available for all new cars. Perhaps you'll find an even better bargain on a new car you had not considered.

Step 3: Locate Your New Car
As you search for your car, keep in mind that the more flexible you can be about options and color, the wider the range of the vehicles you'll find for sale. Being flexible will also give you more leverage to negotiate a better price, since you are not emotionally connected to one specific car.

On the home page, select the make, model and year of the car you want. You'll then get a page that displays several actual cars for sale in your area, along with Price Promise® offers. (More about Price Promise in the next step). Click on the link "Find Cars for Sale Near You" in the upper half of the screen. You then will make selections about options and color to get a more complete list of matching cars available for sale. Once you find the exact car you want, the next step will be to contact the dealership.

Step 4: Use Price Promise and Dealership Internet Departments
Now that you are approaching the deal-making phase of the process, here's more about a good pathway for buying a new car: the Price Promise program. It assures car shoppers a guaranteed, up-front price on a specific car.

Look for Price Promise offers on the car of your choice, print out the certificate on the page and you are ready to go to the dealership to conclude the deal. It's a good idea to call ahead and make sure the car is still available. Here are other tips on how to use Price Promise to buy your next car.

If there's no Price Promise offer on a car you want, shopping through a dealership's Internet department will save you time and money. You can easily communicate with the Internet manager by phone or e-mail.

We know that many people are drawn to the traditional way of car buying: visiting showrooms right off the bat. If you go this route, you should assess the car salesperson who is working with you before moving forward. Ask yourself if you feel comfortable and sense that you can trust this person. If you do feel comfortable, set up a time to test-drive the car if you haven't already done so. (It's a key step in finding the car that's right for you.) Before you head to the dealership, review all your notes and bring them with you.

Step 5: Try Negotiating a Lower Price
Price Promise offers are usually below Edmunds TMV. But if you think you can negotiate an even better deal, you have another option: Request Internet price quotes from at least three local dealers. Take the lowest price, call the other dealerships and say, "If you beat this price, I'll buy it from you." The dealer almost certainly will give you a better price.

Some shoppers find this time-consuming and stressful, so consider whether the potential savings are worth the time and effort. It's good to remember that a good deal isn't just the lowest selling price. It's a combination of the most streamlined, enjoyable shopping experience and the lowest total out-the-door cost.

Step 6: Review New Car Fees and Check Dealer Financing
Besides the cost of the car, you have to pay sales tax, registry fees and a documentation, or "doc" fee. You can estimate these extras using Edmunds' Monthly Loan Payment Calculator. Now ask the Internet sales manager or the dealership's Price Promise contact to supply a breakdown of all the fees, or a "worksheet," which lists the purchase price, the vehicle's invoice and all related fees. Review the figures carefully before signing the sales contract.

Back in Step One, you were pre-approved for financing. But who knows? Maybe you can get an even better interest rate at the dealership. To see if that's possible, you can let the dealership run a credit report and assess what interest rate you qualify for. If it is lower than your pre-approved loan, go for it. If not, you already have a good loan locked in.

If the price, financing and fees look right, it's nearly time to say yes to the deal. But before you do, consider making the sale contingent on having your new car delivered to your home or office. This is a great time saver and allows you to close the deal in a relaxed environment.

Step 7: Sign the Paperwork
This step will take place at your home if you have the dealership deliver the car, or at the dealership if you prefer to pick it up there. Either way, make sure there are no dents or scratches on the body or the wheels. Check that all the equipment is included, such as floor mats, owner's manuals and rear-seat DVD headphones. Your new car should also come with a full tank of gas. If anything is missing or needs repair, ask for a "Due Bill" that puts this in writing.

In cases of home delivery, the salesperson arrives with all the necessary paperwork. If you opt to pick up your car at the dealership, you will sign paperwork in the finance and insurance office, where the finance manager may try to sell you additional items. These typically include extended warranties, fabric protection or additional alarm systems. These extras can often be purchased elsewhere for less. One product that can have real value is an extended auto warranty, which provides peace of mind to many buyers and could save you money in the long run. Remember, though, that its price also is negotiable and you can always buy it later. You can learn more about the products offered by the finance manager in "Negotiating a Dealer's New-Car Add-Ons."

Review the contract carefully and make sure the numbers match the worksheet and that there are no additional charges or fees. A good finance manager will explain each form and what it means. Don't hurry. Buying a car is a serious commitment. And remember, there is no cooling-off period. Once you sign the contract, the car is yours.

Step 8: Take Delivery of Your New Car
You are probably eager to begin driving your new car. But this is an important step: Let the salesperson give you a tour of your new car. This could include showing you how to connect your smartphone to the car's Bluetooth system and learning how to use other important features and safety devices. Yes, you can review all this in the manual later, but it's quite helpful to get a hands-on demonstration. If you don't have time for a complete demonstration when you sign the contract, ask to visit the dealership a week later for this important step.

As you drive away, there is only one more thing to do: Enjoy your new car.

Most Recommended Comments

By rlee47
on 02/14/11
11:25 PM PST

Someday the car manufacturers are going to realize that people are tired of the games that their dealerships play with buyers. Just look at this article, loaded with warnings about how you could get taken to the cleaners during vitually every step of the car buying process! What does that tell you about the integrity of the whole class of businesses that sell cars? While the internet appears to be helping buyers, I'm finding that many dealerships view it merely as a toll to gather sales leads which they then want to lure into the same sordid sales process. Price quotes are many times meaningless. It's hard to get dealerships to compete on an out-the-door price on the "same vehicle", because there is such a wide variety of trims, options, and add ons. Perhaps the answer is more customers knowing exactly what make and model they want, and being flexible about colors and minor cost options in the hope that within that spectrum there are cars that fit their needs at almost every dealer within a reasonable distance, then insisting on going to the dealer only to take delivery. I'm trying to do this right now. Hopefully it will be the first time in over forty years of buying many new cars that the memory of purchasing one won't be unpleasant. Wake up you manufacturers! Many of us have been ready for years to buy online in a streamlined process that allows us a level playing field in your game of "guess what the dealer really paid for this car and what he might actually accept to sell it to you". Can you imagine having to buy everything else you do not knowing the price you are going to have to pay? It's long past time for a change.

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By ensoniqdap
on 02/21/11
8:05 AM PST

Having just found out that I was COMPLETELY ripped off in a car purchase in December 2009... I am SICKENED that state and federal officials like to play "help the consumer" but fall far short with legislation that really does nothing more than say "better luck next time." Short version of events: I was a life long Connecticut resident living in the middle of the state. My car had died unexpectedly, so I went out and, after a few test drives, I bought a car in November 2009 and it wasn't the right car for me so I traded it back to the same dealer for purchase price minus "registration fees" Those fees came to $1011.00. But I bit the bullet and took it as a "rental fee". The dealer showed me a 2006 Ford Fusion... When he went to get the keys for the test drive, I asked to see the carfax. The carfax report was clear. I test drove the car and thought it was a decent car. During the execution of documents for purchase, the dealer said that the "lender is requiring a 2 year extended warranty" I pushed forward. The car also came with "free tires for life". I had received $10,900.00 for trade on the first car and financed $7,367.00 for a total purchase price of $18,267.00. In January 2010, I called to get the car brought in for new tires... It was at this time that I was informed 1) I was informed I had to drive the car at least 25,000 miles before getting the new tires and 2) that the car had to have all oil changes done at the dealership and that since I had not done so, the tire warranty was void. In April 2010, the power window on the passenger side of vehicle stopped working... The motor worked but nothing happened. Further, if I hit a bump, the window would slide down on its own. In October 2010, BOTH power mirrors stopped working the same day... I suspected a fuse and check... as far as I could tell, it was not a fuse. At the very end of December 2010, I had moved to Rhode Island and went through registration & required inspection process. The car failed inspection due to a check engine light that was on. The check engine light was reset and codes cleared to see if there was a problem or if it was a one time code... it came back on again. On February 2, 2011, I took the car to a repair shop that could do further diagnosing of the issue and I was informed that BOTH catalytic converters were shot and needed to be replaced at a cost of $2,000.00 each (according to my research). On February 4, 2011 I took the car to a dealer to just get rid of it. The dealership offered me $5,000.00 trade... a loss of $13,267.00 in 13 months!!! I was just about at boiling point... It was about to get worse... The dealership stated that according to the carfax they pulled, this Ford Fusion had been in an accident in July 2007; LONG before I purchased the car. I was now livid. I asked to see the carfax which they provided and in black and white was an accident from July 10, 2007. Further, the car had been sold at auction in March 2009, September 2009 and November 2009. The dealer I purchased it from listed the car for sale on November 30th, 2009. Additionally, the car was practically idle from March 9, 2009 to when I bought it having been driven on 179 miles in just over 9 months. I am now left to pick up the pieces from a horrible deal and see what, if any, action I can take against the parties involved. I know this was supposed to be a short comment... guess that couldn't be done...

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By nell79
on 01/10/11
12:56 PM PST

I found this site to be of great value to us when we purchased out last vehicle. We learned quite a bit in our experience too and I wrote an article about it Get the Best Deal on a Used Vehicle

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