Archive for June, 2009
Sooner or later we start thinking about selling our car. Maybe it starts having too many problems; maybe you just want to have something new. Where should you start? How much should you sell your car for? What is the value of my car? Where should you advertise? – In this article I’ll try to answer these and some other common questions, that a person who is selling a car might have.
When should I sell my car?
Any car or truck will reach a point when it will start ‘falling apart’ or will require more and more repairs. It’s good idea to get rid of your vehicle before it reaches that point while it still has some value in it. How do you know when your car will start falling apart? One of the things you can do is to ask your mechanic what to expect from your car (or truck) in the near future – he (she) should be able to tell you what kind of mechanical shape your car is in. You should mention any changes that you notice in the way your car runs – for example, a puff of blue smoke at startup or the transmission not engaging right away on a cold morning, or corrosion starting to appear here and there – these are the kind of early signs that could tell your mechanic about future problems with your car or truck.
Another thing to remember is that it’s more difficult to sell a car after a certain mileage or age (e.g. 100,000 miles).
It’s a good idea to have all your questions about paying for your car resolved before you start to shop. The most difficult part about buying your used car will probably be figuring out what you can afford. So how do you determine what you can afford?
A good rule of thumb: your monthly auto loan payment should not be more than 20% of the money you have available each month after you pay for your usual living expenses — rent or mortgage, utilities, food and transportation, credit card payments, etc. When reviewing your budget, you should also take into consideration other associated costs including fuel, license, registration, personal property taxes and insurance. Call your insurance company before you purchase your car to determine what the monthly insurance cost will be.
If you’re taking out a car loan, figure on a down payment of at least 10 percent. Lenders might be skeptical otherwise. If you have enough cash available to boost that percentage, do so. Cutting the principal of your loan will do more to slash payments than getting a lower interest rate.
If you have ailing credit, which can result from a pattern of late payments, you may find yourself in the “subprime” financing arena. If you have credit problems, you should first try to work with a consumer credit
counselor or other advisor. It may be possible to consolidate debts or come up with a workable repayment
plan. If you show a loan officer that you are taking action to overcome the problems, they may be more willing to grant a loan at a reasonable rate.
In addition, be sure to check out alternate sources for loans such as the credit union at your workplace, your bank, or other organization with which you are affiliated. As a last resort, dealers may offer special financing packages for those with credit problems. However, you might pay as much as four percentage points more for a loan.
Damage Disclosure, Salvage & Rebuilt Titles.
These titles are issued by states when the vehicle has sustained damage as a result of one or more incidents. States issue salvage titles when an insurance company takes possession of a vehicle as a result of a claim. This generally occurs after a vehicle has been declared a total loss. A state may issue a rebuilt title if a vehicle sustained damage and was rebuilt or reconstructed, then placed back on the road. States issue junk titles to indicate that a vehicle is not road worthy and cannot be titled again in that state.
Lemon Laws (Manufacturer Buyback Titles).
“Lemons” are sometimes resold to consumers as used cars. The lemon laws were enacted to protect consumers from having to keep a new car that has recurring problems. If someone buys a new car with major problems, and the manufacturer fails to repair the defect in a certain amount of time, the manufacturer may be required to refund the consumer’s money by buying the vehicle back. Unfortunately, some of the vehicles which are bought back are subsequently resold as used cars.
Flood Damage Title. States issue flood titles when a vehicle has been in a flood or has received extensive water damage.