Individuals feel excited when choosing to purchase a car. A car is necessary for its convenience in city and interstate transportation. In nations such as the US, where intercity travel is common, some individuals have to be able to travel between cities.
Some procedures must be followed before buying a car in the US. These procedures include situations related to the legal process and parts that concern the personal financial situation. Therefore, making the right choice for your specific purposes is necessary.
Nowadays, cars have become an essential rather than a luxury. The procedures that need to be done when buying a car can be challenging, but let's see how we can make it simpler for you with this article! To easily follow these procedures, you can also look at the checklist for buying your first car as a newcomer in the US, written by experts in the MyChek app.
1- Choose According To Your Budget
It is important to adjust your budget before buying a car. This process will allow you to concentrate on cars that align with your financial capacity, thereby narrowing your options to those that are feasible within your fiscal constraints. To set this budget, you need to calculate your household's savings, income, and necessary expenses.
By making these calculations, you can predict the amount to be spent on the car by taking into account the purchase price, the necessary monthly/yearly expenses, insurance, and fuel costs. Choosing according to your budget is important to prevent this from happening.
Acquiring your first car in the US necessitates meticulous budget management. Because there may be extra expenses related to the car, without stringent budget control, meeting these additional costs may become challenging and cause problems later on. Without effective budget control, you may find yourself unable to cover these necessary costs. For this, you can take a look at the checklist on budgeting in the MyChek App and also review the savings guide on the website.
2- Deciding Between New or Used Cars
One of the biggest dilemmas faced by those who want to buy a car is whether to choose a new or used car. Both options have advantages and disadvantages.
New Cars
The advantages of a new car: You will be the first person to drive it in that car. The engine is new, unused, so to speak, you will have a vehicle that has just recently taken off from the factory. Since no one has used it before, there will be no question mark in your mind whether there is a maintenance or complete problem.
New cars are covered by the warranty, so you will benefit from the warranty coverage without paying any fees in case of any problems you experience. New cars are also advantageous in terms of financing and payment options.
As a disadvantage, new vehicles have high costs. Car insurance may have higher fees as the car is new. The driving experience and accident record of the person driving the car may change the insurance cost. When you want to resell, your car will suffer a loss of value. Since the new car will turn into a used vehicle, you can sell it below the price you bought it for. Value loss may vary according to the model.
Is it better to just get a new car?
If you have experience driving a car and can afford to bear the loss of value or possible expenses that may occur when reselling, you can choose a new car.
Is it worth buying a new car in the US?
Buying a car in the US can be worth it if you plan to use the car you buy for a long time and have the necessary maintenance done regularly. Buying a new car in the US can be made easier with the various payment options available.
Used Cars
The advantages of used cars are much lower in price than new cars because they are already used. For this reason, finding and buying a well-used car is crucial. Cars that have not been involved in accidents before, have been used cleanly, and do not have any partial problems attract the attention of individuals.
Looking at the car's previous history is essential for buying a well-used car. While insurance fees for used cars are typically cheaper than for new ones, the actual premium depends on a variety of factors, including the car's condition, safety features, likelihood of theft, and the driver's profile.
A used car with malfunctions may attract higher premiums, and new drivers generally face higher rates regardless of the car's age. If you buy a well-used car, your car will not suffer much value loss. As a disadvantage, used cars usually have no warranty or a short period. If the manufacture year is older, they may not be equipped with modern technology.
Financing and payment options may not be as diverse as for new cars. Maintenance and service costs can become a major problem if the car has not been well used, thus increasing both the depreciation and the cost.
One factor you should pay attention to when buying a new or used car is the trustworthiness of the dealer you are buying from. Make sure you buy from a reputable car dealership or a reliable dealer! If you buy from a dealer or a dealership that you are insecure about, you may encounter problems.
Is it cheaper to buy a used car in the US?
Used cars are cheaper than new cars. However, being cheap does not guarantee that you will not incur high maintenance costs later. Therefore, it is imperative to be careful when buying a used car. Unless you do not know much about the car, it is recommended that you go to inspect the car with a person who does.
I am new to driving; should I buy a new car or a used car?
If you are new to driving and have no previous experience, it is generally recommended that you use a used car. While new cars may lose much value due to accidents, scratches, and various reasons, used cars do not lose much value because they have already been used.
3- Research and Choice Process To Buy The Car
After answering the question of whether it is a new or used car, you need to determine the car models according to your needs and wishes. The size of the car is the most important of these needs.
If you have a crowded family, you do not want to buy a small car. If you prioritize comfort, consider selecting a car with ample interior space and high luggage capacity. Sports cars offer speed and agility for those seeking performance. If you are a camper or adventurous, off-road cars are more suitable.
For long-distance or intercity rides, cars with fuel efficiency will minimize the cost of fuel. If you are looking for a car for urban driving, compact/small cars are convenient because of the small size of the roads and parking lots in the inner city. Therefore, you need to choose the size of your car according to your needs.
After deciding whether you want to buy a sedan, hatchback, or SUV, you can compare the types of different brands with each other to make your decision even easier. Apart from that, each car model has different fuel costs. Some cars spend more fuel while others spend less.
The more fuel it consumes, the higher the fuel cost. In addition, different additions may be inside the cars. These additions include parking assistance, automatic transmission, touch-screen console, autopilot, etc.
Car models should be researched to align with your essential requirements and personal preferences. Finding and comparing more than one car model can make a more precise choice.
Once you find a car that meets the desired criteria, it is convenient to review other people's feedback about it. This feedback can be a key element in identifying overlooked details that you missed during the decision-making process.
4- Get Pre-Approved for a Loan
Purchasing a car does not mean spending all the savings you've got! You can apply for a loan to buy your first car in the US! A high credit score is the most important factor in buying a car with a loan. (You can find out how to improve your credit score here.) With a high credit score, you can access more advantageous loans and interest offers.
Once you know your credit score, you must evaluate the loan offers you receive from many places. During this selection, do not forget to look at the interest rates and repayments that are suitable for your budget. Choose the option that best matches your financial situation and long-term goals. You can access all information about getting a loan, raising your credit score, and different types of loans with the MyChek application.
After your pre-loan approval, you will be able to prove that you are eligible for a loan with the document you receive from the bank. Based on the amount of the loan you can receive, you can either pay the entire cost of the car or you can prefer to pay part of the cost of the car first and then pay the rest month by month.
If you plan to purchase a car on a monthly installment basis, ensure it aligns with your budget by accurately calculating the loan’s monthly payment, the car's ongoing monthly costs, and your essential monthly expenses.
5- Shop Around
After finding the car model with the criteria you want, you can search for car dealerships in your area. If there is a car of the model you want in the dealerships, you can request a test drive there.
This way, you can experience the performance and comfort of the car first-hand. After experiencing the car, you should know the market of the car well before negotiating. Thus, the bargaining process can proceed healthily, and an appropriate price can be agreed upon. The reliability of the dealership or dealer you buy from is important when buying a car, so make sure you use recognized car dealerships or dealers as much as possible.
The most preferred car dealerships in the US [1]:
All of the above-mentioned car dealerships sell both new and used vehicles. They offer many different models of cars, motorbikes, and other motor vehicles. They also have nationwide recognition and distributorship.
An additional strategy for securing the best car at the optimal price is to visit every car dealership within your area. The more dealerships you visit, the broader your range of options will be. Thus, you can purchase the car in the most favorable condition by multiplying your options. Using the MyChek app features, you can facilitate the negotiation process by adding the prices of the sales places you have visited to the shopping checklist.
6- Purchasing Process
Having found the car model you want, tried it out, and been satisfied with it, the only thing left is the purchasing process. One of the most important things to consider during the purchase process is to examine the purchase contract in detail. It is imperative to fully understand every terms and conditions in the contract. Documents required when buying a car as a local or an immigrant in the US:
Passport/ID
Documents showing/proven immigration status such as a Green Card, EAD (Employment Authorization Document), or a valid visa. It is for Immigrants!
Social Security Number (SSN): If you do not have an SSN, an ITIN (Individual Taxpayer Identification Number) can be used.
Proof of residency
Proof of income
Loan history
Car insurance
Valid driving licence in the US
Vehicle registration and license plate
Contract of purchase
Proof of payment: Receipt or payment voucher
You need to make sure that the documents are correct and up to date so that the process can be completed smoothly.
It is essential to read and understand the contract thoroughly to avoid problems with the car afterward. Car dealerships usually have flexibility in their prices. Therefore, ensure you know your chosen vehicle's market, features, accessories, and maintenance costs. Don't hesitate to negotiate!
Once the contract is thoroughly read and understood, only the paperwork remains. Registration of the vehicle, title transfer, and insurance are all required. This process can often be complex and perplexing. The Buy Your First Car in the US checklist, created by the experts at MyChek, shows you step-by-step how to proceed.
7- Take Delivery of Your Car
Before finalizing your purchase and taking possession of your car, it is highly recommended to test drive it again. This way, you can approach the dealership in case you encounter any issues with the car before the purchase is fully completed. You can also request the sales representative to assist you in teaching you how to use all the car's features. In this way, you can have a more comfortable driving experience and ensure you derive the maximum efficiency from your car.
Each car's maintenance process may differ, so you need to learn the necessary maintenance processes from the car dealership you purchased. After learning the maintenance schedules, you can use the MyChek checklists to make tracking them easier. In this way, you will not miss the maintenance time and violate the insurance of the car.
8- Essential Tips After You Buy Your First Car in the US
Once you have purchased the vehicle, the work is not over immediately. The car must be regularly serviced and maintained. This prevents possible car part failures, which in turn increases the performance and usage time of the car.
For this reason, it is highly advised to be taken for maintenance when the km/mile or time comes as directed by the authorized service center. The period or the mileage of a car that needs to be serviced regularly may vary for each brand and model. In the US, taking the car for regular maintenance is not compulsory, but the car dealerships and the brands recommend it. In vehicles with a car warranty, delaying these maintenances may cause a violation of the warranty.
The vehicle's registration and insurance must always be active to avoid fines and cover possible damages. Getting offers from different insurance companies is important to get a policy. This way, you can evaluate many offers and choose the best insurance policy that suits you. The duration of insurance coverage can vary among each insurance company.
Therefore, keeping track of the insurance expiration date is vital to avoid a large cost in case of possible damage. The checklists in the MyChek application make it easy to track both the insurance renewal period and the dates of scheduled car maintenance.
Frequently Asked Questions (FAQ)
How can I ensure I’m getting the best insurance policy for my car?
To get the best policy, you should visit several insurance companies and compare the insurance policies with the desired features. Then you can choose the most favorable one among them.
Do all car insurances cover all possible issues that may occur in the car?
No, not every car policy covers everything that can happen to the car. Therefore, carefully examine your insurance policy according to your living conditions. For example, if your region is a stormy/hurricane region, you may need to take precautions against this in your insurance policy.
Is every car's warranty is same duration?
The warranty duration of each car is not the same. In used cars, the warranty period could be 6 to 12 months or even no warranty period at all. However, it is completely different for new cars. Generally, warranty durations vary between 3 and 10 years. You can increase the warranty duration by paying extra fees according to the manufacturer's policy.
Can immigrants buy and drive a car in the US?
Yes! You can buy your first car in the US by following all the steps described in the article!
When do I need to go for the maintenance of the car?
Regular car maintenance is not mandatory in the US, but manufacturers and dealerships recommend it periodically. Maintenance times may vary depending on the brand or model of the car. When you buy your car, you can request the recommended maintenance schedule from the place of purchase.
Can you drive in the US if you are not a citizen?
Yes, you can! If you already have a driver's license, you can use it in certain states. However, some states may ask you for an IDP (International Driving Permit). You can check here for the requirements in the state you are planning to visit.
At what age can I drive in the US?
The driving age in the US varies from state to state, but it is usually between 16 and 18.
Conclusion
This guide presents the chronological steps to buying a car in the US. To summarize, you must determine your budget, choose the car model that suits your needs, new or used, find out your credit rating and whether you are eligible for a loan, do market research to negotiate with the dealership, examine all the paperwork during the purchase process to complete the purchase and learn about the necessary maintenance.
The process of buying your first car in the US can seem complicated. With MyChek's customized checklist for this process, you can complete each step individually and get your car quickly.
You can use MyChek educationally and functionally by accessing checklists related to the car buying process and various related topics. By clicking here you can download MyChek on your iOS and Android devices.
References
[1] The top ten largest auto dealerships in the USA in 2022. MSMsupplychain. (2023, January 11). https://msmsupplychain.com/2022/07/08/top-10-biggest-car-dealerships-in-the-u-s-a/
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