04.Get the best deal
Arranging your finance
Only 40% of car buyers arrange their finance before going to the dealership. There is a huge variation in interest rates, and in most cases you’re better off arranging your own finance rather than through the dealer. Having your finance pre-approved also gives you a more solid bargaining position. According to Canstar Cannex, the best car loan interest rates are available from small credit unions, which offer especially good deals for cars with environmental credentials. The major banks typically offer loans at least about 2% higher than the cheapest credit union products.
Tip: If you have a home loan with a redraw facility, this could be your cheapest option – but make sure you make extra repayments of the same amount or more than you would have paid for the car loan. The longer you take to pay it off, the more interest you’ll pay.
Finalising the deal
Inspect and drive the car you’re planning to buy. Verify it is the right model with the right features. Don’t sign anything before everything is in place to your complete satisfaction. If the car in question needs accessories fitted, or any other adjustments, it may be difficult getting this done after the purchase has been completed. Also make sure no item is left blank on the forms.
Be particularly wary of having a deposit unless you have a 100% guarantee it’s fully refundable should the deal fall through. It’s a good idea to pay your deposit with a credit card so you can use the chargeback system if the dealer goes out of business before you pick up your car.
Finally, don’t forget to have your insurance in place (generally via a cover note) before driving away in your new car. As with finance, although the dealer is able to arrange insurance, you’re better off doing it yourself.
Tip: Many dealers work on monthly sales targets and may be prepared to do a better deal at the end of a slow month. But according to Amoddio, “if you want to do this you really need to be prepared to buy on the spot”.
CHOICE members get the best deal
For the best deal on a new car over $10,000 call CHOICE Shopper on 1300 360 655 (member's only service). Cite the model and make of the car, as well as the quoted price you want to beat and your CHOICE member number.