Car Buying & Financing - Georgia Tech Office of Human Resources

Report
Car Buying & Financing
Confidence
“Education that will save you time & money”
Brought to you by:
Georgia United Credit Union
Who is Georgia United Credit Union?
• 100% member-owned and not-for-profit
• Founded by State Employees & Georgia
Educators
• One of the largest & strongest credit union’s in
Georgia
– 120,000+ members across Georgia
– Together, we are $940+ million in assets
– Deposits are insured by the NCUA up to $250,000
per account.
Today’s Speaker: Tywone Thomas
We will cover:
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Financing – The Importance of Pre-approval
Know market pricing
Trading-in a vehicle
Things to consider before you sign
Car buying service
Tips
Where do you start buying a car?
Financing
• Get pre-approved & know your budget before
shopping.
• Don’t leave yourself at the mercy of dealer
financing.
Financing- Benefits of Pre-Approval
• You are prepared with a budget
• Won’t have to worry about financing on-thespot
• Quick approval online or in-person
• Pre-approval quote good for 60 days (from date is
credit is run)
Financing – Dealer financing or rebate?
Dealer Financing Vs. Rebate offer?
EXAMPLE*: The dealer offers a $3,000 rebate off the
purchase price or 0% financing with approved credit.
Price
Rebate
Amt.
Financed
Interest
rate
term
Monthly
payment
NO rebate and 0%
Dealer Financing*
$20,000
$0
$20,000
0.00%
60
months
$333
Dealer rebate and
financing through
Credit Union*
$20,000
$3,000
$17,000
1.99%
60
months
$298
*Example only. Actual terms , rates & conditions vary.
Know Market Pricing
John Smith visited Toyota of Lawrenceville. He
spotted a 2010 Honda Accord that was
advertised for $15,995. He told the salesman
that he would like to pay only $10,000 for the
car and the salesman looked puzzled? He asked
the customer where did he get that number
from and the customer could not give an
answer.
Where did Mr. Smith go wrong?
Know Market Prices
Check Values:
• www.NADA.com
• www.KBB.com
Know Market Pricing
Whitney received a call from her mechanic stating that
it was going to cost more money to fix her 2001 Ford
Focus than what the car is worth.
She decided to start shopping for another used car. She
went straight to the dealer and saw a beautiful 2011
Chevy Cruze that had a special advertised price of
$14,995. Whitney immediately agreed to buy the car at
the special sales price.
What HUGE mistake did Whitney make?
Don’t shop alone
The Love Cloud
Your Trade
Advantages to Selling
• Likely make more money $
Advantages to a Dealer Trade
• Tax advantages on your
new purchase
• Example: New vehicle
$25,000 and trade-in
worth $10,000, your new
taxable amount is
$15,000*
*Taxable amount based on the State of Georgia’s value of the car
not the sales price. You can view all taxable values on the GA Dept.
of Revenue website.
Your Trade
• Arm yourself with a CarMax trade-in quote
• Get more than one appraisal
• What if you owe more than your trade-in is
worth?
– Consider selling on your own
– “Dealer Payoff” – beware, negative equity will be
rolled into your new loan.
Before You Sign - Consider Fees
Sample: Bill of Sale
Before You Sign- Understand add-ons
• GAP Insurance
– Pays you the difference between payoff from
insurance incase of a total loss
– Good if you’re not putting much money down on
the car
• Extended warranty
– Good if you don’t have money in the bank saved
to fix problems
Before You Sign – Mistakes to Avoid
Jennifer found the deal of the century on a 2010 Mazda CX9.
She purchased the vehicle for $2,000 less than the trade-in
value. Two days went by and she noticed that her tire gauge
light came on, so she decided to take it to a nearby tire shop
to get it checked out. The mechanic looked at her and
informed her that her tires were dry rotted on the inside and
there was rust all underneath the vehicle.
What are two mistakes that Jennifer made?
Before You Sign - Mistakes
1. She should have asked for an Autocheck or
Carfax report.
2. She should have taken the vehicle to a
mechanic before committing to buy the
vehicle.
Before You Sign – Consider Variable Cost
Such as Gasoline and Insurance
Before You Sign – be cautious of Scams
OFAC-Office of Foreign Assets Control
• Some dealers use OFAC as a way to get your
social security number and pull your credit.
• If you are financing your vehicle with your credit
union or paying cash, you do not have to fill out a
credit application.
• Never give your social security number to a
dealer unless you are financing with the dealer.
Before You Sign- Upgrades/Extras
• Does this car come with an ___________?
• Negotiate this before commitment. If you
wait after the sale, you may be ignored.
Car Buying Service
• Credit union car buying service: Auto Assistance of
Georgia
• Works with members to locate a car that meets their
needs & budget.
• Assistance with trading in your old car
Tips
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Buy at month end (not just year end)
Look for rebates
Everything is negotiable except at Carmax
Buy close to invoice as possible
Don’t shop alone
Get a mechanic inspection
Get pre-approved first
Questions?
Thank you for Attending!
Still have questions?
Contact us anytime at:
Financing: 770.476.6400 ext. 3
Car Buying Service: 770.476.6471
www.georgiaunitedcu.org

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