Buying New Car

Buying New Car stress relates to the fact that it's one of the largest purchases consumers make after buying a home.

A recent study shows one out of four buying new car customers pay $1,000 too much - all in financing costs.

At issue are some loans car buyers get through their dealership at the time they make the purchase.

The Consumer Federation of America, a Washington, D.C.,-based consumer interest group, said consumers often pay additional fees in that process - totaling as much as $1 billion nationwide - without realizing they qualified for cheaper financing.

What happens is that a bank approves an interest rate, the dealer tacks on additional percentage points as a kind of service fee and then the dealer and lender split the difference.

About half of car buyers choose financing through the dealership.

If the dealer offers you a higher rate, go elsewhere. Customers can walk out the door, down the street and find their own competitive financing.

Go to your bank, go to your credit union, get on the Internet. Find an interest rate that you qualify for in a buying new car loan.

Whether buying new or used; or selling a vehicle, first check a reliable car price guide such as KBB (Kelley Blue Book), Black Book, Red Book, or the NADA Used Vehicle Guide.

For more on all things automotive, turn from buying new car to the home page.

Subscribe to our RSS feed for the latest on
Buying New Car .