Personal Finance

Winnipeg Free Press - PRINT EDITION

Help ease the frustration in buying a vehicle

By: Devin Size

Posted: 09/8/2012 1:00 AM | Comments: 0 | Last Modified: 09/8/2012 10:40 AM | Updates

TORONTO -- As Nance Faubert shops around for her first car, she is realizing how frustrating it can be to find one that fits both the needs and the budget of a recent college grad.

"I've been pricing and looking around for used vehicles, because I can't afford to buy new," says Faubert, 21, who has already been to a dozen dealerships.

Your to-do list

-- Always test drive the car to get a feel for it

If buying new:

-- Assess your monthly budget to gauge your price range

-- Check several dealerships for the best promotions

-- Research vehicles for the features you need

-- Compare financing and loan options

-- Investigate insurance based on vehicle desired

If buying used:

-- Shop both online and at dealerships to compare prices

-- Verify the vehicle history report using the vehicle identification number

-- Get it inspected to make sure it will pass certification

-- If buying "as-is" get it looked over and appraised by a certified mechanic

-- Get insurance quotes based on year of car and kilometres on the engine

"I live and work in North Bay (Ontario) so I just need something to get around since the city is widespread."

Faubert doesn't want to get pressured into buying a car that isn't going to last.

A little legwork and due diligence will alleviate the stress of shopping for your first set of wheels, and ensure you've covered all the bases before signing on the dotted line.

What to look for:

Scott Seguin, a sales consultant at Hyundai, says assessing need over desire is an important factor in determining the vehicle that's right for you.

Questions to ask yourself while shopping should include: Do you plan to drive in the city only or will you be driving long distances? Are you carrying passengers regularly?

Online sites such as carcostcanada.com, carcompass.ca and carbuyingtips.com can offer insight when doing your initial research along with a variety of tips, advice and cost comparisons.

And with rising gas prices, look for vehicles that are economical in fuel consumption.

Buying used over new costs less, but you need to be comfortable with buying a car someone's previously driven, which could potentially have skeletons in the trunk.

There's nothing wrong with getting a car "as-is", since you can find parts and repair it yourself -- or have someone you know do the job. However, if you ask a dealer to fix it up, be prepared for a markup.

Do your research:

You can verify the condition and history of a used car by getting a vehicle history report online with the vehicle identification number (VIN), which is listed on the car's ownership papers.

That will give you information such as previous owners, average mileage, servicing records, past accidents, whether airbags were ever deployed, if it has suffered frame damage and if it was ever a rental or fleet vehicle.

It will also tell you if an insurance company would deem the car a "total loss," which would indicate repairs to the car are worth more than the market value of the vehicle.

How to finance:

Whether you choose to buy new or used, how you're going to finance the purchase is crucial.

Getting approved for bank financing or a dealership loan is contingent on steady employment, credit history and your amount of existing debt, says Scotiabank's vice-president of automotive finance, Lilliane Dubois.

You can either get financing through the dealership, or go directly to your bank and apply for an auto loan.

"It's the customer's choice in the end where they want to get the loan, but manufacturers will offer interesting loans at low percentages based on new car promotions," said Dubois.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition September 8, 2012 B11

History

Updated on Saturday, September 8, 2012 at 10:40 AM CDT: adds fact box

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