Take the time to jot down all of your monthly expenses, then subtract from your monthly income. Once you know the payment that you can afford, use your CARCULATOR to compute the total loan amount and then you'll know how much car you can really afford.

First, make a list of everything your new car must have, such as four doors or an automatic transmission. Then, list out what you would like to have, such as a satellite radio or a sunroof. When you are choosing between models, you will now feel better about matching the right car for your needs, rather than making an emotional decision that you may regret later.

Before you hit the dealership, work with your bank to determine how much of a loan you can get and what interest rate you will be charged. Even better, get a pre-approved and no obligation loan. This will give you a bargaining tool and will force the dealer to try and beat the interest rate.

Buying a car is very emotional for many people and you'll get even more excited once you get behind the wheel. This excitement may cause you to make irrational decisions during the negotiation process. The best defense is to wait at least a day after you test drive, so you can think clearly and feel good when you make your deal.

Car salespeople have some of the worst reputations, and unfortunately too many of them live up to this stereotype. If you encounter a salesperson that you dislike, ask the sales manager to provide someone else, or even go to another dealership. Buying a car should be a pleasant experience and a salesperson should earn your business with a positive and professional attitude.

There are so many variables in a car's price, it is easy to get lost when comparing deals. Be sure to find out if a dealer's offer price includes things like tax, processing fees, manufacturer rebates, and after-market accessories. If comparing a lease, be sure to account for the mileage allotment, down payments, and fees.

When manufacturers offer special pricing, they often provide a choice between a low interest rate and a cash rebate. Compute your loan payment using both scenarios to find out which makes for a lower payment. Remember that you may not qualify for the low interest rate, but everyone can typically use the cash rebate option.

For a loan, the more money you put down the less money you are borrowing. Over time, this saves you money by lowing the finance charges assessed by the bank. Resist the idea to use your down payment to buy more car than you originally budgeted for! For a lease, be careful with too much of a down payment as you may lose most or all of this if your car is in a serious accident.

Although it will take some effort, you will almost always get more money selling your car privately than using it as a trade-in. This is because the dealer wants to make profit on your car, so they must buy it for far less than they can sell it. By selling it on your own, you are essentially keeping that profit for yourself. At the minimum, get a quote from at least two dealerships.

Before you hit the dealership, finish all of your research and understand your financial situation. The best way for the dealership to take advantage of you is to use information that you don't have, such as your credit score or how much your trade-in is really worth. When you level the playing field you take away these advantages and set yourself up to get the best possible deal.

Mixing these three elements is the surest way for the dealership to maximize their profit at your expense. Since most customers are focused on the monthly payment, they will mix and match these numbers until they find a combination that appears to make you happy. Always start with the price they will sell the car for, and then have them evaluate your trade-in, then finally work out the payment based on those first two numbers.

Your credit report will determine the interest rate you will be charged for the car loan, and this can cost or save you thousands of dollars. You have the right to dispute inaccurate information on your credit report. Be aware that this process can take some time to resolve, and whether you are buying a new car or not it is always a good idea to review your credit report at least once a year.

It's not uncommon to spend two or three hours or more at a car dealership. Be sure to eat a good meal beforehand, and if possible leave your children at home. The last thing you want is to be hungry while you are trying to negotiate a deal, or else you may hurry things along just to get it over with. And if you think you can get impatient during negotiating, imagine how antsy your children will be!