The length of time of repayment for the average car loan has now reached six years. By spreading payments over such a long period of time, the buyer may turn out to be “upside down”, and that can be a painful experience.
It’s expensive buying a car and it only gets more so as time goes on. I’m no spring chicken alright, and anybody my age or thereabouts can tell you the rate of inflation has nothing on how price of new cars keeps going up. This isn’t entirely due to greed on the part of automakers; cars are also more complicated and useful than they used to be. Back in the 1960s, when I was a young man, cars were definitely cheaper, but came sans air conditioning, and there was no such thing as a video system – unless your name happened to be John Carpenter or Bob Crane. There is a hefty price tag on safety and entertainment, after all.
The increase in the price of new cars is analogous to the increase in the length of time it takes the average person to pay off their car loans. Few people pay cash; most people take out loans and pay over time. The average car loan, which used to be repaid over a period of three years, now averages about six years in duration. That’s a long time to pay for a car, especially if you have no plans to own it for that long.
Well, there are some advantages to having a six-year term for your car payments, as your monthly payments wouldn’t be as high as they were had you been on shorter terms. But this is what is particularly “hard on the knees” – you get turned topsy-turvy when you find yourself in negative equity due to such a protracted loan term. You would only be paid the car’s financial value if and when it is totaled – and that value isn’t much, of course – and not the value of the vehicle you are still in arrears for.
A buyer is described as being upside down when he or she owes more on a car loan than the car is worth. Be warned, for it takes so little to make a buyer feel topsy-turvy about things, and here are some of the events that could lead to this:
A lack of down payment – take note that the value of your car can depreciate by up to 25% even if you merely drive it off very carefully from the lot. If you haven’t provided enough of a down payment to cover that depreciation, you may find yourself upside down immediately.
Frequent trading in. It sounds like the smart and savvy thing to do, but it’s not really too prudent to trade your old car for a new one, and roll what you have left to create a new loan. These unpaid debts can contribute to negative equity.
Too long a loan. As mentioned above, negative equity can result from long loan terms, like five to six years. The best way not to get into such a predicament would be to limit the LOL (life of loan) to three, rather than five or six years.
In order to avoid a potential problem in the event of an accident, you should contact your insurance provider to make sure that you have “gap insurance.” Should you be turned upside down and get into an unexpected accident, gap insurance would ensure that you remain sufficiently covered. Without gap insurance, you may be making monthly car payments on a total wreck that used to be known as your car. That is the last thing any car owner wants.
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Your car or truck for sale by chance? Maybe I’d like to buy that if you give me the specs, but if I were buying, I’d be like other used car buyers – these people look at the buyer’s reputation even closer than they look at the car. It would be your main concern, in that case, to win over customers by keeping them interested and proving that you are trustworthy – the only way you can do this is through open and confident communication.
Be ready to answer their questions as soon as prospective buyers start calling. Set your customers’ expectations properly by confidently and honestly answering any questions, even those “pop quiz” questions they may have over the phone. Both ends of the transaction are trying to separate the wheat from the chaff – you’re trying to sell and they’re checking their used car options – so this process eliminates wasted time, money and effort. In addition to this, you must be precise and brutally specific when setting appointments – instead of providing nebulous information to the effect of “you can come over on the weekend”, you should give them a specific day/date and time, such as “Saturday the 30th, 5 PM.
Making accurate and specific appointments always increases your odds of having buyers come over to take a gander at your vehicle. Late customers are part and parcel of the process – you don’t have to wait for them. For a smooth sailing transaction, you may want to request a cell phone number or any other contact information, and if somebody cancels abruptly, it’s not the end of the world. They may or may not give notice of cancellation, but sometimes, all you can really say or do is say “oh well.”
Always expect that there may be some customers who want to take the vehicle for a test spin. Insist on going along for the ride, so you can answer any questions that may be fielded while ensuring the vehicle stays safe. There is also the possibility that the customer may not be familiar with the area, so riding along with them allows you to serve as a guide.
There also may be a few buyers who would insist that the car must first be inspected by a mechanic. Perhaps this is the best opportunity to wave (and not waive) that legal mumbo-jumbo at them to prove your vehicle is road-worthy. When buying or selling a car, this request is very much understandable and expected.
Protect Yourself
Naturally, you would want to protect your interests and be prudent when dealing with potential buyers, thus this quick final reminder. One classic example would be to insist that you secure the potential buyer’s driver’s license to protect your rights should he or she independently decide to test-drive your vehicle. If anybody interested in buying AND test-driving your car or truck objects to such a protocol, chances are he or she may have an ulterior motive and is not just after the test-drive. Conversely, if the buyer insists that he or she has the car inspected by a different mechanic than the one you consulted before offering it for sale, he or she is being reasonable. Be flexible while keeping your guard up and you’re sure to find an interested and trustworthy buyer in no time.
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As parents we often have to make unpopular choices for our children perhaps most often when choosing their first car. Teenagers, particularly boys, look at cars as status symbols. If the engine is bigger, then the car will be faster and racier which is better. As parents, older, slower, and safer is what we prefer.
There are a few points to consider when choosing a car for your teenager. First and foremost, there is a budget to consider and your child should consider this as well. Gas guzzling cars may not be an option on your budget or for a child who will be paying for their own gas. Smaller, slower cars tend to be more economical on fuel.
Driving experience should be considered too. When it comes to handling a fast car, is a 16 year old equipped with the experience? What about their reactions, are they honed by years of driving in traffic? A brand new car with a fast engine is an unguided missile in inexperienced hands no matter how badly they want it. Chances are pretty good that your teenager is going to bump the car within the first year. Remember that you will be end up with more expensive repairs if you get the more expensive car.
Safety is a huge concern for parents of teenagers who drive. Although we can’t stop them driving, we can make sure that they keep their cars in good working condition. Don’t forget to teach your child to routinely check tire pressure, oil levels, tire wear, water levels, and lights on the car. Another thing you should teach them is how to change a wheel in case of a puncture. Airbags is not the only thing to consider when it came to safety in a car.
Setting a good example in terms of driving habits can help too. If you don’t speed, drive recklessly or break the law, your child is less likely to do so. The consequences of dangerous driving should be explained because in the wrong hands, a car is a one ton weapon and careless driving can have tragic as well as life-changing results. You may not want to dampen your teenager’s enthusiasm, but they need to be aware of the dangers too.
It will not be easy to convince your teen that they don’t need the newest, fastest car on the lot, particularly if they have friends who have them. Remember that it is still your responsibility to look after them even if it makes you unpopular. Like many decisions parents have to make, your children are only likely to understand them and appreciate them once they themselves have children.
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Car buying is a big business and lot of scams happen in this area. Though car buying scams are most prominent in case of used car purchases, the scams-as you will find in any automotive news plague the first hand car business also. The interesting point is however that most scams happen because of fraudulent buyers. However sellers also cheat.[more] Therefore it is essential for both the buyers and sellers to be familiar with some of the most common car buying scams and the ways to detect and prevent that from happening to them.
You can almost find everything on sale online nowadays, so one will come across so many sites over the internet dedicated to selling cars. The best or worst part of the internet is the anonymity of people. Many bogus buyers take advantage of this situation and cheat the sellers. One of the most common types of used car buying scams on the internet is referred in Automotive News bulletins as….
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A car is a technical thing. It’s not always possible to be tech-savvy though online Automotive forum with the required information are galore, but us humans possess an innate instinct to make money; a large chunk out there so far have tried too many-a-line of works to stay replete. It must have also come under their notice that the automobile sector has been hoisted to a new height recently, dragging positive possibilities along; the ones with the power to invest are welcome to have a look.
Buying and selling cars is not like buying grocery everyday. Though serious shoppers may pose an afflict – well, just like checking the ingredients, every section in an automobile requires to be checked thoroughly before shelling the dough for the handover. This is vital since there are certain proven methods that kill a problem temporarily and sometimes, for over a few months. The price is evident, a further wear and tear that shows up once damage sets in. Moreover, that is huge.
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Searching for a good used car, especially one which is reasonably priced, is very time consuming and can sometimes seem impossible.
While it is impossible to find a great car for a dirt cheap price at some dealerships, its not impossible to find a deal like that elsewhere, in the less common places you might find a car, but if you want to save thousands of dollars there is atleast one great resource that not many people know about.
Car Auctions: Save Thousands On Every Car You Buy
Car auctions sounds complicated and some people might just think, “I can’t bid”, or “I don’t know where to find good deals”, or “how do car auctions work?” But that’s exactly what CarSnaps is here for. Like all of our past articles which have helped thousands of people in making the right car decisions, we will make sure that you make the right decision too and find the best deal available to suit your own needs.
Going to auctions, bidding and looking for cars at an auction can be complicated and daunting. So we have found and put together a great resource to help you overcome those difficulties. It is a little-known website for car auctions and it has records from every city and state car auction. You simply have to sign up to become a member, search and find your dream car and then place a bid on it! Its fast and easy and best of all, its entirely online, so you don’t need to feel out of place at a live car auction.
Once you’ve overcome this stage, you can then go and inspect the vehicle yourself and purchase it if you like it. We have recommended this website to a select few friends and relatives who have used it to purchase cars but we haven’t published it before because it was too much of a secret to pass out. Things have changed now and the pressure on people’s income is forcing them to make rash buying decisions and put up with sub-standard services so we felt that now was the time to hand out this advice. One great example from a friend of mine was that in 2007 he managed to buy a 2006 Audi TT (in the above picture) for a mind-blowing price of only $2200. Yes, you read that right, $2200!!
He was really lucky and deals like that arent available every second but if you do try and lady luck is smiling upon you, you can find some great auction bargains.
And that concludes today’s buying guide. Good luck finding your dream car and the best deal on it. Please do let us know how your search goes and if you do buy something. We will start a small section on the CarSnaps Website or Automotive Forum where people who got great deals will be able to post their experiences and upload photos of their new ride too. Goodluck!
Visit the Secret Used Car Auction Website Here
