2007-04-17T14:58:54.547-05:00Information Gathering, Part IVWhat You Need to Know about YOU:It really doesn't matter whether you get the value of your automobile or the value of yourself first. It is important, though, that you get these values prior to making your automobile purchase. You've already read, and hopefully researched, how to obtain the value of your vehicle. Now I'll show you why it's important to research the value of yourself. If you're one of the lucky few that can step on a car lot and put down cash for a vehicle then this post isn't for you. You are a rarity, but still need to know what your car or truck is worth so refer to the previous posts. For the majority of you, though, financing your vehicle will be the avenue taken. Since this is the case, the value which determines YOU when buying any car, truck, SUV, or van, is your credit rating. Most dealerships use a "beacon score" or "FICO" score to determine your credit rating. Beacon score is a term used loosely by many dealerships which actually applies to one of the credit reporting agencies' scoring format. FICO stands for the Fair Isaac Corporation, and is the leading credit score model used in the U.S. Whichever term they use, what the dealership's finance and insurance (F&I) manager is doing is checking your credit rating with one or more of the three major credit reporting agencies: Equifax, TransUnion, and Experian. Initially, credit scores fell within a range between 300 and 850. In 2006, though, the three credit reporting agencies got together to develop another system, VantageScore, which rates the creditworthiness of consumers between scores of 501 and 990. A grade is then applied to the consumer from A to F (A=901-990; B=801-900; C=701-800; D=601-700; F=501-600). While this system is in use, FICO scores are still used by many dealerships. The majority of consumers fall between the 600 and 800 range. Generally, those with 720 or better receive better interest rates on loans while those with credit scores in the 500's will see higher rates (usually 3 to 4 points higher). As you can see, it would be important to know which scoring system the dealership is using when you apply for your auto loan. Simply asking once you get to that point in the auto-buying process will help you in more ways than one. First, it lets the person you're dealing with know you're a knowledgable consumer and that is essential. Secondly, it lets you get on the same page as the F&I manager when the time comes to negotiate your loan terms. If you would like some more background information about credit scores I found Wikipedia to be extremely helpful. Every consumer is entitled to a free copy of their credit report from each of the three credit reporting agencies once every 12 months. You can obtain a copy of this information by going to annualcreditreport.com. Once there you'll be prompted to select your state and then you'll be directed to a page to fill in your pertinent information. After filling in the info you'll be directed to each one of the credit reporting agencies' sites. After answering a security question only you would know about your credit background, each agency shows the good and the bad information regarding your credit history. THE ONLY THING NOT INCLUDED IS YOUR CREDIT SCORE!! Of course, you can purchase your credit score from each for a nominal fee (To make things easier I've provided access to purchasing your FICO score on the side of this blog). Although these reports won't include your credit score, they will provide you with extensive information about your credit. Also, you'll have the opportunity to see if there's anything on your report that shouldn't be there which could be disputed, taken off the report, and, ultimately increase your score. If you are financing your automobile, the importance of having your credit score cannot be stressed enough. As a consumer applying for any type of loan, knowing your credit score before applying for the loan is the single-most important negotiating tool you can have at your disposal. Having your credit score in hand prior to approach[...]
2007-04-12T12:56:34.421-05:00Information Gathering, Part III:
2007-04-10T23:34:14.526-05:00Ok, by now you've had a chance to familiarize yourself with www.kbb.com and hopefully found a trade-in value for your vehicle. Once at the site you moused over to the right of the page where it reads "Used Car Values." From here it is self-explanatory that you find your particular vehicle's category on this page, click it and then you're prompted on each successive page to select a make, model, year, etc., until you reach a page that prompts you to select the Kelley Blue Book value. On that page you want to select "Trade In Value." This will begin the prompts to find out the starting figure most dealers will use to value your vehicle towards your next purchase. After selecting the trade-in value button you will input the vehicle's trim (such as LX, EX, SLT, SE, etc.) and equipment (to inlcude miles on the odometer). Don't just guess on these items. Inputting your vehicle as an LX rather than an EX while mistakenly guessing at the miles and forgetting to include something as simple as a roof rack, could cost you hundreds, if not thousands, in trade-in value. After these prompts you'll be directed to the page where you select the vehicle's condition. This is where you want to rate your vehicle as "Good." Most vehicles fall into this category and once you select it you'll still be able to see the comparison price between Excellent, Good, and Fair on the final "Trade-In Value" page. And that figure, your trade-in value, is the starting point for negotiations that will ensue once you start the auto-buying process.
2007-04-08T22:44:18.599-05:00Research: Picking up where I left off we'll first discuss the first step of the automobile purchase process...RESEARCH! Information overload will be the first thing you'll experience in the process. Just typing in the information "automobile purchase help" into the search engine will result in over 6 million hits. That's why it's important to have a plan and to work that plan. Following my plan could save you lots of money once you do decide to purchase that next vehicle. Let's get started on the first step:
2007-04-04T21:29:27.332-05:00I'll start out by offering excerpts from my own personal info product over the next few weeks to get things going. Eventually I'd like to have this blog be a place for all to opine on their car-buying experiences. I believe we can all learn from each other and maybe help others avoid pitfalls in their purchases.ABC Info Product:People buy a new car for two reasons and two reasons only: because they want one or because they need one. Whether it’s because of a want or need this purchase can be a costly one if not properly prepared. Consider the following scenario…“Honey, don’t you think it’s about time we trade-in our old car for a new one?” John asked his beloved wife.“Oh, yeah, it’s more than about time,” Jane replied citing the 150,000-plus miles on their current four-door sedan. “With the baby coming and our need to have peace of mind knowing our vehicle will be safe and stand up for the next few years, it is definitely time.”“It’s just that this is a major purchase and if we don’t do it right it could end up costing us more than we can afford to spend now and in the future,” explained John. “There is so much riding on this purchase and we both know there is not a car salesperson in the world that truly has our best interests in mind. So, what do we do?”“We do the best we can,” answered Jane. “That’s all we can do.”“Well, then, we better get started,” John said as he sat down in front of the computer and began the research for their upcoming purchase. “What should we get?”“What do you think, minivan or SUV?” asked Jane. “I’m not a soccer-mom yet, you know, so I would love to still be able to show off what we have, so I think an SUV would be better. That will be best during the winter, too, you know.”“Yeah,” replied John, half-listening, as his eyes scanned the more than 9 million responses to his online search for ‘buying a car.’ “I know. I don’t know where to look or what exactly to type into the search engine to save the most time and effort in finding a car.”“We could always just go for a drive and find something that catches our eye,” offered Jane.John just about came out of his seat on that one, “You mean lay our lives on the line at an actual dealership. I don’t think I can put up with the salespeople coming out of the woodwork to ‘help’ us get the best deal.”“We don’t have to stop. Just look,” continued Jane. “Oh, yeah, but then how will we ever get to see what the car’s features are? Crap, why does it have to be this hard?”“Yeah, I wish there was an easier way,” added John as he comforted Jane in his arms. “There has got to be something out there that will take us step-by-step through the whole process and not take us for a ride at the same time.”Sound familiar?NOW, THERE FINALLY IS!Not only for John and Jane, but for everybody looking to buy a new or used vehicle there is one simple product. Armed with the ABC, 1-2-3 Guide anyone can feel confident in making that next vehicle purchase.Ideal for individuals buying their first vehicle or those “veterans” of the car sale battle, the ABC, 1-2-3 Guide will save you on your next purchase and all purchases for years to come.According to auto buying statistics the average auto buyer now purchases a new car every three years (for the sake of time and space “new car” will mean any vehicle being purchased whether it’s new or used and whether it’s actually a car or a truck/SUV/minivan, etc.). To put this into proper perspective realize that if you don’t get it right the first time, every three years you could be digging a deeper and deeper hole. Let’s say you follow this simple three-year buying plan with purchasing your first car after you graduate from college or, when you turn 22-years old. If you were fortunate enough to retire early at, let’s say, 55, using the three-year average, you would purchase 11 vehicles during that time. Fail[...]