5 Ways You Could Be Overpaying for Your Car
Filipinos love cars, that's why we have so much of them. We love them so much that we're willing to forego the perfectly sensible '20 percent down payment, 5 years to pay' auto loan and go with even a '0 down, 7 years to pay' variety. Just so we can drive the car of our dreams, we stop caring whether we’re still paying for the car's true value and are already overpaying.
Granted, longer loan terms aren't the only way you could be paying for your car. If the five ways below sound familiar, you're likely losing money on your car without knowing it.
1. Hidden fees
When signing a loan and/or insurance policy, it’s important that you know and understand all the fees included in the agreement. And all of these fees should be itemized on your monthly receipt. If you keep seeing additional charges on your bill, chances are you're paying more than you need to. These additional fees are excessive and often accumulate. Make sure you know all the fees you're paying for, and don't be afraid to question them or have them removed if they are not listed in your agreement.
2. Wrong car for your needs
Needs and wants are different--you probably need a station wagon for your family, but you bought a small city car instead. In situations like this, you may own a car that you can afford but can't handle your daily tasks, so you end up spending more on other areas, such as passenger fare because your entire family won't fit. Be honest with yourself about your actual needs, both now and in the future, so you can avoid buying too much or too little car.
3. Unnecessary features
Nowadays, certain cars come with automatic subscriptions to apps. That's good and all if you actually use those apps. Conversely, an all-wheel drive doesn't make sense if you're going to use your SUV mainly for city driving. And what about that Hi-Fi 10-speaker surround sound system? It would only be added expense if you only listen to AM radio. For a lot less money, you can opt for a 1-DIN basic radio player. When buying a car, make sure to go over your list of options, and do away with those that you can do without.
4. Not negotiating the price
Always remember: everything about your car purchase is up for negotiation--from the price tag, to the insurance, to the fees, and even the feature options. This is why it's helpful to get multiple quotes from at least three different providers. Make the dealers and insurance brokers compete with each other to give you the best package.
5. Not timing your purchase
If you want to save on your car purchase, you need to time it right. Holiday and end-of-model-year sales promos are exceptionally excellent times to buy a car, as car dealers often offer really huge discounts during these periods. CARMUDI posts the latest sales promos, so make sure to subscribe so you can get updated with these promos as they happen.