Friday, August 10, 2007

Car buying..

I would like to share my experience about car buying and few things I learnt from it. It would typically apply to international students who will be starting with their first job in the US.

Looking for new cars on websites and building them with all the fancy interiors and colors was my favorite pastime in the last semester at school. Almost everyday I would fluctuate with my car of choice based on consumerguide review, some performance metric, handling, value for money, looks, re-sale value etc. I used to have lengthy discussions with classmates explaining the reasoning behind the choice. It was really nice to see how everyone had different opinions.

The first question was whether to buy a new car or a used car. Most elders would suggest buy a used car, get accustomed to driving and then later when you have enough money buy a good new car. From a financial standpoint this tip definitely makes sense. If you read this article it strongly recommends against buying a new car for new college graduates http://financialplan.about.com/od/college/a/SmartMoves.htm
This question is more complicated than it appears and depends upon a lot of factors. Some might need a car just to go from point A to point B. For some there might be other financial commitments like loans etc. But a new car will have its own benefits!! Feel of a new car will be altogether different than a used one, better warranty and maintenance guarantees etc. Its something very personal and would vary from person-person. I chose to buy a new one and so the rest of the post is related to it.

Find it out yourself. Especially factors like the demand for a particular car and availability in the market. I was considering the Honda Civic and I got this wrong information from someone that it has a waiting period of 3 months. I had ruled it out completely until I visited a dealer where they had a Civic model for atleast 2-3 different colors ready to be sold the very same day!!

Judge for yourself; test drive. Do read reviews to shortlist your choice of cars but always test-drive when you do car-shopping. When you test-drive don't turn on the music system! The dealer or seller might be trying to hide any defects. Also if its automatic transmission you would want to know how smooth the transmission is. If possible test-drive for a bit on a freeway!

I had pleasant experience test-driving with most dealers on Stevens Creek except Infiniti and Lexus. Infiniti salesperson looked least interested!! I'm pretty sure that Infiniti will have a tough time competing against BMW & others if they hire such salespersons . After giving us a test-drive on the Lexus IS250 , the Lexus salesperson never came back to give us a quote!! May be thinking we didn't look like potential buyers!!

Customizing a car doesn't work exactly the same as it works on a website. Sometimes it won't be possible to get the color you want! The dealer can possibly get it shipped from some other dealer but then you'll have to shell out the expense!! Decide on what interior features you want for your car. It typically works in terms of packages rather than an individual feature. Base prices would make one feel that the car is within reach but the moment you add packages the total price will shoot up! So if you care about interior features then lookout for cars that have them as standard features.

After you've decided on your car(with color and package) the next step would be to look for finance options (I didn't considering leasing so have no clue about it). Being international students just out of college, few would have substantial credit history. Find out about finance options for fresh college graduates, good student discounts etc. Find out your credit score before starting to look for finance options. Most of the free credit reporting sites have a catch wherein you are automatically enrolled in some plan that makes you pay some amount every month!! So watch out for them! Try to get a pre-approval from your school Credit union. They are most likely to offer a good interest rate. Don't shop around a LOT for finance because each time a credit check is done it might (not completely sure) negatively impact your credit score! HSBC Auto finance would be a good place to get a pre-approval online.

The last step would be to get Insurance quotes. Honestly, I didn't find out much about insurance companies. Just took it from a company called Farmers Group in CA. General rules, if you are a single male under 25 then expect to pay higher insurance. Same would apply to sports cars and convertibles!

I hope this information helps new college graduates looking to buy their 1st car. All the best!!

7 comments:

Suvrat said...

gr8. finally you started blogging.
i remember checking out cars everyday in our ini office and all the discussions we used to have about cars. must be a nice feeling to own one :)

Bankim Bhavsar said...

yeah definitely!!
I remember we considered all cars from Pontiacs to Mercedes!!

chheda said...

short n simple..a good start to ur blogging.
i thought it wud be more detailed tho...with all that engine, horsepower crap :P

Rupsha said...

well written.. will definitely be useful when I consider buying a car next year...

Gaurav said...

well written....captured the thoughts of all new grads who hav bought a car (or a looking to buy soon)....i was predicting (accurately ofcourse :P) wht is going to be in the next few line

Ujjwal said...

Nicely done. I would have mentioned about the car you finally bought and the reason behind it as a summary - welcome to blogosphere (albeit a little late welcome ;-))

Bankim Bhavsar said...

You are right I should have done that... Buts its never too late :)
So for those who don't know I bought a new Acura TSX with navigation system.
I wanted something that had decent power/pick-up and good interior features. One advantage about Acura is that all interior luxury features are standard so nothing extra needs to be added. Also I think its good value for money because other cars with similar features will cost higher.