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Watch Out for These Red Flags When Buying a New Car


Buying a new car is a huge financial commitment.

As such, you want to make the right choice. But making the right choice involves more than selecting the proper vehicle: it also means receiving competitive terms and protecting your vehicle for the long-term. With these things in mind, here are some common red flags that can help you steer clear of a bad deal.

Vehicle model history

Buying a new car is a bit of a gamble because you don't know the long-term advantages or consequences of what you're buying. However, you can use the model's history to determine the initial quality of the car you want.

J.D. Power does an initial quality study annually that highlights the best vehicles in each segment. Along with this, you can see how many recalls a model has had over the past five years by conducting a quick Google search or using the NHTSA's website.

If you encounter multiple recalls with a car you're considering, it could be an indication you'll encounter trouble too. And if this becomes the case, then it might be best to move onto another choice.

Dealership tactics

Dealerships are in the business of making money, sometimes at the expense of the customer; this is why it's vital to do research before visiting the dealership. Some of the things you should consider include:

Market value: Websites such as TrueCar show how much others in your area paid for the exact model you're considering. Armed with this information, it can help you identify dealers who might be overcharging you.

Financing terms: Before visiting the dealership, you'll want to gather three quotes from lenders. You can compare these terms with what the dealership's financing team offers you, and if you notice a high discrepancy between what the dealer's financing offers and other lenders, it could be a sign of things to come.

Add-ons: Etching, rust proofing, GAP insurance, and extended auto warranties are a few of a dealer's favorite things when it comes to finalizing the sale. And this cost balloons even more if you finance the vehicle. Therefore, how pushy a dealership is on these add-ons can determine whether it's worth it for you to go through with the deal.

Warranty offerings

Since you're making a big financial decision, you want your car's manufacturer to stand behind it. Manufacturers are becoming wise to this, as some are offering 10-year limited powertrain warranties. If you are torn between two cars, consider the warranty offerings, as it's an indicator of which manufacturer is willing to stand behind their product more.