How to Make Car-Buying Less Stressful, More Rewarding

Need new wheels but dreading the hassle involved? Buying a car needn’t entail endless legwork and massive stress. Here’s how to make the process a whole lot easier — and perhaps even enjoyable.

Do the math first

You’ll be spared lots of heartache by understanding what you can afford from the start. Determine your down payment, and then aim to keep your total car expenses, including financing, gas, maintenance and insurance, to no more than 20% of your take-home pay after you’ve paid your other bills. To help estimate the ownership costs of particular models, visit auto comparison sites and consult an insurance agent. Or you can streamline that process: Some financial institutions like United Financial Credit Union offer free apps that allow you to scan vehicle identification numbers to get the average retail cost and estimated gas mileage for that model and to compare and rank the ones you’re interested in.

Find your best financing

Although dealer financing is the path of least resistance, it’s not always the wisest choice. Even when dealers advertise 0% loans, these are often reserved only for those with near-perfect credit. You can strengthen your bargaining position by getting pre-approved for a loan through your lender. That way, you’ll know exactly what your interest rate will be and what you can afford to buy.

Another approach is to work with an institution that partners with local dealers to provide financing where you buy the car. Credit unions typically offer very competitive car loan rates, even if your credit is less than perfect, in part because they’re member-owned not-for-profit organizations that exist to serve their members’ needs.

Shopping for used cars

Buying a used car can be cheaper, in part because the original owner has absorbed the high level of depreciation that comes when a new car leaves the dealer’s lot. The trade-off is getting a limited warranty, or no warranty at all, along with concerns about reliability and future mechanical costs. Before going with a used car, review its history through a site like If the history is sound, consider having a reliable mechanic examine the car.

Don’t sweat it

When you’re ready to negotiate, get your best deal without raising your blood pressure:

  • Make sure you know the base price or fair market value of the models you’re considering, as well as what a fair price is for any options you consider essential.
  • Find out if you’re eligible for cash incentives, discounts and rebates frequently offered to credit union members, military personnel, students and recent grads.
  • Always negotiate on the vehicle price rather than the monthly payment, and negotiate this price separately from any trade-ins.
  • Don’t let salespeople push you into a quick decision or upgrades you don’t need. You have the power to walk away and look elsewhere.

When you’re armed with financing options, the knowledge of what you’re willing to pay and the market value of the car you want, the final conversation with the dealer can be stress-free. You’ll be pleasantly surprised as you reflect on your car shopping adventure to find that it wasn’t worth worrying about after all.

Roberta Pescow, NerdWallet