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Car Buying 101: Volume 1

So you want to buy a car!

This will be the first in a series on the "How To" of car buying.

Step one:

Budget

Now I know nobody likes to think about it, but it’s time to break open that piggy bank and part with some of that hard-earned cash to buy a new car. For some - I doubt that they are any on this forum - buying a car is for one purpose and one purpose only - to get from point A to point B. I’m going to try and stay in the middle here on the issue of car buying. We are going to focus on buying NEW cars, I will get into USED cars at later date.

How much can you afford?

Now I know that a lot of you on this forum are financially comfortable and a car budget isn’t a problem. But there are some people that may need to justify the cost of a new car.

Here are a few things to consider when deciding how much can you afford.

Vehicle Cost

• The Vehicle itself
• Sales Tax (In most states)
• Luxury Tax (In every state for a few more years)
• Personal Property Tax in some states
• Registration, licensing or both
• Any other taxes or fees that I’m unaware of (some states may have additional taxes)
• Maintenance (Everything except gas)
• Repair cost (This is less of a problem now with most new cars because they come with at least a 3 year warranty, many cover more than 3 years)
• Daily expenses, such as gas
• Insurance (This is the hidden cost that is rarely looked at until it’s too late)

I know most of you already know this, so please bear with me and remember this is Car Buying 101. So we’re taking it from the beginning.

So now you’ve looked at every potential cost and said to yourself “I think I still have enough money to buy a new car?”

Determining the vehicle cost

Finding the price of a car is much easier than it used to be. The Internet is a giant library just waiting for you to ask the right questions. Newspapers wouldn’t exist if it weren’t for advertising, and auto ads are one of the biggest. The mega dealers spend well over $150,000.00 per month on advertising. Have you ever noticed that car dealers never mark down their cars by percentages?

Here’s a couple of places on the internet to find the price of a vehicle. Both Retail and Whole sale (Or the price the dealer paid)

• www.kellybluebook.com
• www.edmunds.com

There are many more, like brokers, online dealerships, newspapers, and magazines. The above two are free and you won't get spammed or have to give a credit card for security purposes. And you can find almost any vehicle's price, and you can use it as many times as you like.  To save time will stick with the two above.

You'll notice discrepancies on both web pages in the cost of the vehicles and the cost of the options.  Don't worry about it, because the numbers you'll find in above web pages won't correspond to what your going to find at the local dealer anyway. It's just a range and were are looking at the cost of the car, not what your going or willing to pay.

Vehicle cost differs from state to state and even from town to town.  Why, you ask?
One word will explain it, location, location, location. Yes Real Estate my friends plays a factor in the price of your car. Where you buy your car from not where you live.

Now, I live in a smaller town near the state capital. But some of the world's most expensive Real Estate is less than 2 hours away. The Bay Area, Silicon Valley, the City, San Francisco, what ever you want to call it. It's expensive to live there, and so are the cars.

You will pay more in heavily populated areas than in the rural areas. But the selection and availability differs in all areas. The dealers have vehicles on their lots, that represent the car buying public of that area. This doesn't mean you can't get a good deal it just means that the asking price is a little higher. The dealers in big cities sell more cars! And can afford to bring the price down very low to sell a vehicle.

Remember popular vehicles, such as Corvettes, are less negotiable.

I will use a basic vehicle for an example:

2001 Chevrolet Malibu Standard model
Using Kelley Blue Book

 

MALIBU
1ND69 Sedan 4D		15692.25	17150.00
Destination Charge		585.00	585.00
		---------	---------
BASE MODEL PRICE WITH DESTINATION CHARGE		16277.25	17735.00
(Mfr's. Effective Date 3-2-01 Revised)
Note: Base price does not include advertising and other dealer costs (see below).
––––––––– OPTIONAL EQUIPMENT –––––––––
SPECIAL FEES/CREDITS/INCENTIVES/OPTIONS
R6M	New Jersey Cost Surcharge	48.00	N/C
	(Req'd in New Jersey)
---	College Graduate Incentive (Expires 9-30-01)		-400.00
	(For Recent Graduates Only) (Regional Programs May Vary) (Restrictions May Apply)
---	Customer Incentive, 1.9% Short Term Financing (Expires 4-2-01)
	(N/A w/Cash Customer Incentive or Fleet Incentive-VX5) (Available Only in Western, South Central & Southeast Regions) (Regional Programs May Vary) (Restrictions May Apply)
---	Customer Incentive, 4.9% Short Term Financing
	(N/A w/Cash Customer Incentive or Fleet Incentive-VX5) (Available Only in North Central & Northeast Regions) (Regional Programs May Vary) (Restrictions May Apply)
---	Customer Incentive, Cash (Expires 4-2-01) • Models in Southeast, Northeast, North Central & Western Regions		-1000.00
---	• Models in South Central Region		-1250.00
	(N/A w/Financing Customer Incentive or Fleet Incentive-VX5) (Regional Programs May Vary) (Restrictions May Apply)
EMISSION EQUIPMENT (All Orders Must Code an Emission Equipment)
FE9	Emission Equipment, Federal	N/C	N/C
YF5	Emission Equipment, California	N/C	N/C
	(Req'd in California)
NG1	Emission Equipment, Northeast States	N/C	N/C
	(Req'd in Maine, Massachusetts, New York & Vermont)
NC7	Emission Equipment Override, Federal	N/C	N/C
	(Req's Emission Equipment-YF5 or NG1)
NB8	Emission Equipment Override, California/Northeast States	N/C	N/C
	(Req's Emission Equipment-FE9)
ENGINE
LG8	V6, 191", SFI (3.1 Liter)	Std.	Std.
TRANSMISSION
MX0	Automatic, 4-Speed w/Overdrive	Std.	Std.
PREFERRED EQUIPMENT GROUPS (All Orders Must Code a Preferred Equipment Group)
1SA	Preferred Equipment Group	N/C	N/C
	(See Std. Equipment Listing)
1SB	Preferred Equipment Group • Base	895.50	995.00
	(Items Included in Pkg. May Not Be Deleted)
	Base Includes Dual Power Mirrors, Reading Lights, Power Windows, AM/FM Stereo w/Cassette, F&R Floor Mats & Speed Control.
	LS Includes Special Leather Surfaced Seat Trim, Rear Spoiler & Power Sun Roof.
OTHER OPTIONS
AU0	Entry System, Keyless Remote Control • Base	135.00	150.00
	(Std. LS) (Std. w/PEG-1SF) (Req's PEG-1SB)
B37	Floor Mats, F&R • Base	36.00	40.00
	(Std. LS) (Std. w/PEG-1SB on Base)
K05	Heater, Engine Block	27.00	30.00
VH4	Mud Guards, F&R • Base	67.50	75.00
	(Std. LS)
UL0	Radio, AM/FM Stereo w/Cassette • Base	198.00	220.00
	(N/A LS) (Std. w/PEG-1SB on Base)
UN0	Radio, AM/FM Stereo w/CD • Base w/PEG-1SA	288.00	320.00
UN0	• Base w/PEG-1SB	90.00	100.00
	(N/A LS)
UP0	Radio, AM/FM Stereo w/CD & Cassette • Base	180.00	200.00
	(Std. LS) (Req's PEG-1SB)
AM9	Seat, Split Folding Rear • Base	175.50	195.00
	(Std. LS) (Std. w/PEG-1SF) (Req's PEG-1SB & Seat Trim-G) Includes Cargo Net.
**H	Seat Trim, Cloth • Base	N/C	N/C
	(N/A LS) (First Two Characters Refer to Interior Color)
**G	Seat Trim, Custom Cloth • Base	N/C	N/C
	(Available & Included Only w/Seat-AM9 on Base) (First Two Characters Refer to Interior Color)
K34	Speed Control • Base	216.00	240.00
	(Std. LS) (Std. w/PEG-1SB on Base)
PF7	Wheels, Cast Aluminum • Base	279.00	310.00
	(Std. LS) (Req's PEG-1SB or 1SF)
TIRES
---	(4) P215/60R15 BSW	Std.	Std.
EXTERIOR COLORS (All Orders Must Code an Exterior Color)
41U	Black	N/C	N/C
	(Req's an Interior Color)
28U	Blue, Navy Metallic	N/C	N/C
	(Req's an Interior Color)
76U	Bronzemist, Medium Metallic	N/C	N/C
	(Req's an Interior Color)
33U	Driftwood, Light Metallic	N/C	N/C
	(Req's Interior Color-52)
56U	Green, Dark Jade Metallic	N/C	N/C
	(Req's an Interior Color)
44U	Maroon, Monterey Metallic	N/C	N/C
	(Req's an Interior Color)
12U	Silver, Galaxy Metallic	N/C	N/C
	(N/A w/Gold Pkg.-Y11) (Req's Interior Color-92)
16U	White, Bright	N/C	N/C
	(Req's an Interior Color)
INTERIOR COLORS (All Orders Must Code an Interior Color)
92*	Gray	N/C	N/C
	(N/A w/Exterior Color-33U) (Last Character Refers to Seat Trim)
52*	Neutral	N/C	N/C
	(N/A w/Exterior Color-12U) (Last Character Refers to Seat Trim)
––––––––– STANDARD EQUIPMENT –––––––––
	Air Conditioning Alternator, 105-Amp. Axle Ratio, 3.05 Battery, 600-cca Brakes, Power Front Disc Braking System, Anti-Lock Clock, Digital (w/Radio) Console Cup Holders Defroster, Rear Window Door Locks, Automatic Power Drivetrain, FWD Emission Equipment, Federal (Must Code) Engine: V6, SFI, 3.1 Liter Entry System, Illuminated Fuel Tank, 14.8 Gal. Cap. Headlamp Control, Auto Lights: Cargo Comp't., Daytime Running & Glove Box Mirrors, Dual w/LH Remote Control & Dual Visor Vanity Moldings, Rocker Panel Power Outlet, (1) Preferred Equipment Group-1SA (Must Code) Radio, AM/FM Stereo Restraint System, Dual Front Air Bag Seats, Cloth (Must Code) Bucket Stabilizer Bars, F&R Steering Wheel, Tilt Steering, Power Tachometer Tire, Limited Use Spare Tires, (4) P215/60R15 BSW Tongue Load, 100-lb. Max. Towing Cap., 1000-lb. Max. (When Properly Equipped) Trans., 4-Spd. Automatic w/Overdrive Trunk Release, Power W/S Wipers, Variable Intermittent Wheel Covers General Specifications: W.B. 107.0"; O.L. 190.4"; Width 69.4"; Height 56.4"; Cargo Cap. 17.1 cu. ft.; Curb Weight 3051-lbs. (Base), 3077-lbs. (LS). Warranty: 3-yr/36,000-mi Limited Bumper-to-Bumper; 3-yr/36,000-mi 24-hr Roadside Assistance; 6-yr/100,000-mi Sheet Metal Rust-Thru. Engine Specifications: Code LG8; VIN J; Cylinders V6; Liters 3.1; Fuel Induction SFI; HP 170; Torque 190; EPA City 20; EPA Hwy 29

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Now you can clearly see all the available information on this vehicle.