Avoid being taken for a ride by your new or used car dealer

As more affordable new cars are putting pressure on the used car market, some very good deals can now be had on previously owned cars, with the prices becoming more competitive. Late model used cars, especially, offer very good value for money. Sometimes they will have some form of warranty and or service plan cover. Also bear in mind that a used car has already taken its biggest depreciation knock, and won’t lose a chunk of change as you drive it up your drive way.

However, it is hard to beat the peace of mind of buying a new car. A service/maintenance plan will ensure that the first few years of ownership should be relatively pain free. These fixed cost service/maintenance plans are sometimes available as optional extras. Used car warranties tend to be shorter and less flexible. Some used car dealers also offer extended warranties, but don’t regard these as meaning the car is in good condition. And remember, you are not obliged to take the warranty from the firm that the dealer is suggesting – you can always organize your own extended warranty elsewhere. But what else should you look out for when talking to a new or used car dealer?

If you’re shopping for a car, it is almost certain that a car advertisement with the small print “terms and conditions apply” will have caught your attention. Often you will find advertisers are simply not interested in telling the whole story, but simply in getting you to visit their showroom at the very least.

Here are a few new and used car advertising deceptions we think you should know about:

• Many advertisements carry the line “from as little as $xxx per month.” Usually this means either a residual payment deal applies, or the monthly payment only applies for a few months, before it increases… often dramatically.
• Do not regard the picture of the car on offer as being accurate. Advertisers frequently place their flagship models in the ad, only for the consumer to find out later that the deal actually applies to a lower model, which doesn’t have alloy wheels, or air-con, radio, etc…
• Some of the deals promising low monthly installments actually require a deposit bigger than the usual 10 per cent.
• Some deals have certain conditions – such as n annual mileage limit, or a stipulation that you must finance through the dealer’s in-house financing service.
• Remember, if it sounds too good to be true, it usually is. Call the dealer first and get all the facts.