10 Tips for first time car buyers-What you should consider
Buying a car as a first time buyer can be an exciting yet anxious journey. There are so many things to consider and sometimes, not enough information. In this article, we explore all the things you should consider as a first time car buyer.
10 things to consider before buying a car.
1. Know Your Budget (Before the Dealership Tells You One)
Figure out what you can realistically afford per month, but also think beyond the monthly payment. Consider:
▪️Down payment
▪️Taxes and fees
▪️Insurance costs (often higher for first-time buyers)
▪️Fuel and maintenance
A good rule: Your car expenses shouldn’t exceed 15% of your monthly take-home pay.
2. Check Your Credit Score
Your credit score determines:
▪️If you get approved
▪️What interest rate you’ll pay
▪️Whether you need a co-signer
Check your score through free services (like Clear score or your bank). If it’s low, consider improving it first—it could save you thousands in interest.
3. Get Pre-Approved Before Shopping
Visit a bank or credit union and ask for pre-approval. This gives you:
▪️A clearer budget
▪️More negotiating power
▪️Protection from dealer markups
Plus, you’ll know your interest rate and loan terms ahead of time.
4. Understand Loan Terms
Watch for:
▪️APR (Annual Percentage Rate) – the true cost of the loan
▪️Loan term (length in months) – longer terms = lower monthly payments but more interest overall
▪️Total amount paid over time
Avoid loans longer than 60 months if possible—they tend to cost more in the long run.
5. Save for a Down Payment
The more you put down, the less you’ll owe (and the less interest you’ll pay). Try to save at least 10–20% of the car’s price.
Some lenders require a down payment if your credit is limited.
6. Watch Out for Add-Ons
One thing all car sales persons have in common is their ability to sneak in add ons. Dealers love to upsell. And as a first time buyer, you are unfortunately the easiest target. So be on the look out for these:
▪️Extended warranties
▪️Gap insurance
▪️Paint protection
Some are useful, some are overpriced. Ask questions, do research, and don’t agree to anything on the spot.
7. Consider a Reliable Used Car
For first-timers, a newer used car might be smarter than a brand-new one. You avoid the steep depreciation and can still get something reliable.
Certified pre-owned (CPO) vehicles are a safe bet—they come with warranties and inspections. Most car dealerships have them. The likes of Toyota, VW, etc.
Rule of thumb: if it has less than 40 000km, it is as good as new.
8. Don’t Finance for the Wrong Reasons
Avoid financing just to get a fancier car or a higher trim. Focus on affordability and reliability, not bells and whistles. You can upgrade later when your credit and income are stronger.
9. Read the Fine Print
Before signing anything:
▪️Review the interest rate, total loan cost, and payment schedule
▪️Ask if there are early repayment penalties
▪️Make sure all numbers match what was agreed upon
10. Build Credit With Your Loan
If you make on-time payments, your auto loan can help you build a strong credit history—making future loans easier and cheaper.
Set up auto-pay so you never miss a payment.
Final thoughts
Don't rush into buying a car. Research everything you need to know. Shop around. Consider all your options and your overall financial standing. Good luck in getting your dream ride❤️
