While your spouse is off nobly serving the country, you’ve been left with the task of buying a new car. The job can be daunting at best. To get the best deal, military spouses need to be prepared buyers. These five tips can help.
1. Have a Power of Attorney (POA)
If you plan on owning this vehicle jointly with your spouse (both names on the title, registration, and auto loan), you need to have a POA. This document allows you to act on behalf of your service member in situations where he/she must typically be present. As a military spouse, you can legally conduct business in your servicemember’s name for transactions that are authorized by the POA, such as banking transactions, purchasing vehicles, and buying insurance. Check with your lender about POA policies. Some will accept a “general” POA, while others may require a “special or limited” POA.
2. Get Pre-Approved Financing
Remember that financing is just another one of the products sold by dealerships. It is often in the dealer’s best interest to sell you a higher interest loan to maximize their profit margin. By obtaining a pre-approved auto loan, you improve your chances of getting a lower interest rate, which can save you thousands of dollars over the lifetime of the loan. A pre-approval can also help you with price negotiation because you enter the dealership as a “cash buyer.” If your requirements are not met, you can take your business elsewhere. Find out more about auto loan pre-approval.
“One main challenge that consumers face is time spent at the dealer,” said Joe Pendergast, vice president of consumer lending at Navy Federal Credit Union. “If you proactively research and secure your financing beforehand, that will give you the upper hand heading into price negotiations.”
3. Do Your Recon
Before you head to the car lot, know what car you want to purchase, how much you can afford to pay, and the current selling price of your preferred vehicle. With so many cars on the market featuring a vast array of mind-boggling features, it can be challenging to narrow down your shopping list. Figure out what you need out of this vehicle. How many passengers do you need to carry? How much cargo? Do you prefer an automatic or manual transmission? What about fuel economy?
Then, let your budget do the driving. When faced with a myriad of financing options, the issue of affordability often gets blurred. Stick to your bottom line, and shop only for what you can genuinely afford. Consider monthly recurring expenses, such as loan payment, auto insurance, gas, and maintenance. The Navy Federal Credit Union Car Affordability Calculator may be able to help. The good news is that pricing for new or used cars is readily available online. Check Kelly’s Blue Book for the invoice price, the manufacturer’s suggested retail price, and the fair purchase price range.
4. Keep Your Guard Up
Picture this: You walk into the car dealership and strike up a conversation with the salesperson. “What brings you in today?” the friendly salesperson asks. “Well, my husband is deployed, I’m a military spouse, and my car died,” you say. “Really? Wow! Thank you for your service. Don’t worry, we’ll take care of you!” replies the enthusiastic salesperson.
While on the surface, this all seems quite pleasant, be on your guard.
Don’t be fooled by star-spangled rhetoric. Make your car-buying decision based on the numbers. Do your research online before you visit the car dealer to make sure the price really is as good as the dealer claims.
“Doing your research is the best way to avoid hidden fees or markups, as well as unpack any special offers at the dealership,” said Pendergast.
5. Consider a Car Buying Service
Buying a car is a large purchase, and it can be intimidating. If you dread the car buying process and haggling with a dealer over the purchase price, you are not alone. Car buying services exist for this very reason; they allow you to buy the car you want at a pre-negotiated or discounted price. To begin, you can conveniently search makes and models, compare features, view photos, and read reviews on the car buying service websites. Trained dealer representatives learn about your vehicle needs and preferences, show you their inventory and help you select a vehicle. Once you are ready to move ahead with the car purchase, you’ll receive a price sheet showing your exclusive price plus any available rebates so you can see exactly how much you saved.
Enjoy a Smooth Buying Experience
Ready to learn more about using a Car Buying Service? Navy Federal Credit Union’s Auto Buying Program is an excellent place to get started. Their Auto Buying Program provides a streamlined and hassle-free way to find, buy and save on a new or used vehicle.
Navy Federal Credit Union is insured by NCUA.