The 11 Biggest Mistakes Car Shoppers Make

Some people love the process of buying a car. In a perfect scenario, the shopping process would begin when you find the exact car you're looking for, continue with meeting a friendly salesperson who works at a dealership with fair buying policies, and finally finish when you sign a deal that you're happy with. But the car-buying process isn't always so smooth. There's a lot at stake, including time, money and peace of mind. Worse still, as car prices continue to increase and loans become longer, making a car-buying mistake could have serious repercussions for years to come.

You may never have a perfect car-buying experience, but there are some big mistakes that you definitely should avoid. As you start your search for your next car, read over these common buying blunders that can really cost you.

Jump to:
1. Don't skip the research phase
2. Do shop around at more than one dealership
3. Don't ignore the internet department
4. Do focus on more than the monthly payment
5. Don't accept a trade-in offer without first getting an appraisal
6. Do take a thorough test drive
7. Do call your insurance agent before you buy
8. Don't buy from a salesperson you don't trust
9. Don't underestimate the importance of F&I
10. Do shop around before accepting the dealership's financing
11. Don't buy under pressure

1. Don't skip the research phase

With any major purchase, you need to do your homework beforehand. Thanks to the internet, there are reliable sites like Edmunds that supply a wealth of information on new and used car makes and models, reviews, pricing, rebates and incentives, car buying advice, and tips to improve your negotiation techniques.

2. Do shop around at more than one dealership

It pays to shop around when it comes to finding a great deal on a car. Plan on checking out at least three different dealerships. You don't have to do all of this in person. Use the dealer inventory tools on Edmunds and arm yourself with knowledge and pricing information before you even set foot in a dealership.

Compare deals, and when you're ready to buy, let the dealerships with whom you're talking know that you're keeping your options open. This strategy can help you secure a great price. Also remember that it's not just about money.  You also want to choose a dealership you're comfortable doing business with. Edmunds has dealer reviews that let you read what other shoppers have to say about the dealership in question.

3. Don't ignore the internet department

Some people may not even be aware that dealerships typically have an online sales department that lets you negotiate a price and make a deal remotely. That's a huge stress reliever for those who hate negotiating face-to-face. If you're not sure where to start, you may want to "test-drive" your car salesman.

These days, you can even get a car delivered right to your door without ever stepping foot in a car dealership.

4. Do focus on more than the monthly payment

Many buyers go in with a set amount they'd like to pay every month and are happy to share that figure with the salesperson. That may not be the best strategy for all buyers. Focusing solely on the monthly payment means that you're not actually talking about the total price of the car you're considering. Before you agree to any deals, make sure you ask the salesperson you are working with to provide you a breakdown of the "out-the-door price" with all the taxes and fees factored in.

You also need to consider how long you'll need to make payments on any car you're in the process of buying. A dealer might suggest a longer loan so the car fits in your monthly budget. But a longer loan also means you pay more in interest. In the end, you could wind up overpaying for the car or being upside down on your loan.

5. Don't accept a trade-in offer without first getting an appraisal

If you're planning on trading in your old car, be sure to look up its value on your own. The best way to find the value of your trade-in is to use the Edmunds appraisal tool before you make a deal with the dealership.

Be honest when you use an online tool to appraise your car. Very few cars are in "outstanding" condition, and certain option packages can significantly impact your car's value. Be sure to print out the details of your online appraisal and bring them with you to the dealership. 

If you don't think you're getting a fair trade-in offer from the dealership, you might be better off selling the car on your own to a private party. You can also get an instant trade-in value here on Edmunds. 

6. Do take a thorough test drive

It's a good idea to take a thorough test drive of any car you are considering. It's normal to be a bit nervous on a test drive. After all, you're driving a car that doesn't belong to you. That's why the salesperson usually directs you where to go during a test drive, which probably involves going down some local roads and making a few right-hand turns. But does that really give you a sense of how the car handles and how comfortable you are driving it?

"Many of the complaints we get about cars could have been avoided with a good long test drive," says Jack Gillis, former CEO of the Consumer Federation of America and author of The Car Book.

Buyers need to think about how they are going to use the car on a daily basis — driving on the highway, transporting kids and pets, and parking under various conditions, for example. The test drive also is the time to check out visibility when backing up, evaluate how a car seat would fit into the back, and see if that third row is really so easy to get in and out of. 

Make a checklist of your must-have features and refer to it during the drive. And don't forget that modern cars are full of technologies that may not have existed the last time you bought a new car. Make sure you are comfortable with the car's infotainment system, advanced safety systems, and anything else you haven't used before. A good salesperson should be able to help you learn how to use a vehicle's high-tech features. The test drive is when to sort all of that out, not in your driveway after you've already purchased the vehicle.

7. Do call your insurance agent before you buy

You need to look at the big picture — the total cost of ownership — when you're buying a new car, including when it comes to insurance. Will you be paying more or less with this new vehicle? Do you need gap insurance? These are questions that should be addressed with your insurance company, says John Ulin, a second-generation insurance agent at Allstate in Levittown, New York. "Many people let the dealership handle everything, but agents often think about issues buyers forget about, such as asking for an AutoCheck [vehicle history report] if buying a used car. The dealer will pay for it, but you have to request it."

It's not a bad idea to shop around for quotes from multiple insurance companies before you choose the one you're going to go with. It takes time to get multiple quotes, but it could save you a lot of money in the long run.

8. Don't buy from a salesperson you don't trust

Too many people buy cars from salespeople they don't particularly like or trust. Remember, this is a business deal, and the result is for you to get the right car at the right price. If the dealer employee makes you feel uneasy for any reason (if they are too pushy, don't seem to know much about the cars or pressure you into a deal you aren't comfortable with), walk away.

Ideally, the salesperson can demonstrate the features of the car and help match a customer to the right car. So look for a salesperson who listens well and answers your questions directly. Then, as you move from the test drive to the deal-making phase, you will have established a rapport that should make the rest of the process easier.

9. Don't underestimate the importance of F&I

You've negotiated the deal, and you're headed to the finance and insurance office (F&I). You're in the home stretch, right? Not so fast. While this step seems like an afterthought, it's actually an essential part of the deal-making process. F&I is where the verbal promises made by the salesperson are carefully put into a written contract. It's also where a dealership might try to sell you extra things, such as extended warranties and gap insurance that can wind up costing you more than anticipated.

This is another place where research pays off. If you think you might want an extended warranty, check out what they cost and negotiate for a better deal.

10. Do shop around before accepting the dealership's financing

The convenience of one-stop shopping at the dealership can be hard to pass up, but it's smarter to look into financing with local banks or your credit union first. Better yet, get a preapproval for a car loan before you get to the dealership. You will know exactly how much you can afford to spend on the car, and you'll immediately know if the dealer can offer you a better deal on the interest rate.

To get preapproved for a car loan, first check your credit score and credit report. Next, determine your budget, and don't forget to consider how many months you're willing to pay a car loan. Check with multiple lenders before making a decision, but try to do so within a short period of time since each prospective lender may want to pull your credit report, which could impact your overall credit rating.

If the dealership offers the best financing option for you — which may be the case if the car you're shopping for qualifies for incentives from the manufacturer — there's nothing wrong with taking the easy route. But make sure you're armed with all the information you need before making that decision.

11. Don't buy under pressure

You may hear that a car is "the deal of a lifetime" that happens to only be good on that particular day. But shopping for, buying, and driving away with a car in just a few hours is usually unwise. After all, this is a major purchase that can affect you financially for years to come, so there isn't anything wrong with taking some time to sleep on it. It's also possible that expressing some hesitation may well lead to a better offer later. If you're feeling too much pressure to buy the car that day, it may be best to walk away.

Forewarned, forearmed

With any major purchase, it pays to be informed and prepared. Now that you're aware of these common car-buying mistakes, you can ensure you'll find the right car for your family — and get the most bang for your buck. Who knows? You might actually enjoy the process this time around!