Owning a car provides flexibility and convenience that you cannot get from public transit, carpooling, or even riding a bike. However, Rising vehicle prices make owning a new car unreachable for many in the black community. As a result, we often choose to purchase used cars to save money.
Before buying a used car, you should be aware of the obstacles that you will need to overcome during the process.
From the moment you walk on any car lot, you will be subjected to clever sales tactics used to steer you in the direction most benefiting the dealership. Additionally, many black people are disadvantaged by low income and poor credit, which makes us easy targets.
In this article, I am going to provide you with some useful tips to help you prepare for your next car buying experience.
Do Your Research Before Shopping
Before you step foot onto a car lot, you need to do your due diligence. Before you start shopping, sit down and make note of the following information:
What is the purpose of your car purchase?
Are you looking for a family vehicle or something to get you back and forth to work? Staying focused on the reason for your car purchase will help you keep a clear head not become sidetracked by the psychological thrill of car buying. The last thing you want to do is go to a dealership unprepared and allow the dealer to persuade you into buying something that you don’t need.
What make or model do you want?
One of the biggest mistakes that I see many people make, especially those in the black community, is buying cars for “looks” instead of reliability. When we do this, we overpay for vehicles that will not last us very long.
I can tell you from my personal experience that some of the most reliable used vehicles on the road are the ones that aren’t that appealing to the eye, and those cars that we love to “stunt” in look good for 2-3 years, but become less appealing when they start falling apart.
You should always check the ratings and reviews of any car you are interested in before buying. Edmunds.com is an excellent place to get this information.
Know the average price for the vehicle
Edmunds.com is also a great place to find the average price of the vehicle you are interested in buying. After searching Edmunds, you can also look on cars.com or autotrader.com to start pricing local cars in your area.
You may find a better deal by looking at reputable dealers online rather than going to a drive-by dealer without an online presence.
Research the dealer reputation
Thanks to Google, you can find reviews for many dealerships online by simply searching up the name. Additionally, Cars.com provides consumer reviews on many dealers who use their platform.
Know how much you can afford
Before you begin the car buying process, you will want to have an idea of how much of a car payment you can take on. It is important to be very realistic here. Don’t stretch yourself financially.
Once you have a good idea of how much you can comfortably afford, use an affordability calculator to determine how much the total price of the car should be.
Get your credit score
Most car dealers make money from the financing of vehicles. Therefore, they are more willing to negotiate the price of a car if you will be financing it versus paying cash. However, if you have poor credit, you will be at the mercy of the dealer, so you must plan ahead.
Unless you have excellent credit, it is best to avoid going to a dealership without knowing what interest rate/payment you qualify for.
If you think you have poor or average credit, obtain your credit score before going to the dealership. MyFico.com is the best place to get an official FICO score. Learn more about your FICO score in my article ‘What is a FICO Score?’.
Use your credit score to find out what rates you will qualify for. If you know what to expect, you will not be blindsided at the dealership.
| Average New Car Rates | Average Used Car Rates | |
| 579 or below | 14.39% | 20.45% |
| 580 – 619 | 11.92% | 17.74% |
| 620 – 659 | 7.65% | 11.26% |
| 660 – 719 | 4.68% | 6.04% |
| 720 or above | 3.65% | 4.29% |
Obtain outside financing if possible
Taking time to preplan your financing may give you an advantage when going to some dealerships. If you have average credit, you may be able to get financing through a credit union. However, if you have good credit, I would suggest shopping around at some better known banks to get a better rate.
Stay in Control at the Dealership
An informed customer is the biggest threat to any car salesman. Following my guide above, you will walk into the dealership more prepared than most customers. This information gives you a definite advantage, but you have to make sure you don’t lose it.
Be willing to walk away
Never go into a dealership desperate, because the salesman will eat you alive! You should always be willing to walk away from a deal you are uncomfortable with. You are not obligated to any deal until you have signed the contract.
The salesman is only the first line of defense for the dealership, but the finance manager is the final obstacle. The finance manager’s job is to upsell you protection plans and other seemingly useful products. These products make money for the dealer, but add additional costs to your monthly payments.
The initial quote you get from the salesman will often include these protection plans. However, they have clever ways of disguising this and getting you to sign off on these items once you get into the back room.
Do not fall for the “How much are you willing to pay” trick
Always negotiate the actual price of the car, not the car payments. If you tell a salesman how much you are willing to pay, they will finagle a contract that gets you close to that amount, even if the terms are not in your favor.
After you have negotiated the cost of the car, allow the dealer to provide you with a quote. Look carefully at this quote! You should pay close attention to the price of the car, the interest rate, the number of payments, and the monthly payment.
Use an online calculator on your cell phone and quickly check the numbers. If something is off, ask them to break down the payment to you.
If it still doesn’t make sense to you, walk away and do a more thorough check at home.
Get the car inspected
Never drive off the lot with a used car that you have not had inspected. If you have a Midas or CarX near you, they may examine the vehicle for free. Plan ahead. Scout nearby mechanics to see if one is willing to inspect the car for you. Even if there is a small cost for the inspection, it will be worth it.
Many dealers will tell you that they have inspected the car, but you should not rely on this alone. Getting a car checked not only gives you peace of mind, but signals to the dealer that you are not an average customer.
Enjoy your ride
If you have followed this guide, you will walk away from your car buying experience feeling confident about your used car buying decision. You will have the peace of mind knowing that you did everything you can to make sure you made a good choice.
Buying a used car is just the first step. You should be sure to take care of the following things to ensure a long-term positive experience.
- Get your car insured & registered timely
- Maintain regular maintenance of the vehicle
- Make your car payments timely
