DEALER FINANCING 101: HOW TO GET THE BEST DEAL ON YOUR NEW MAZDA CAR

Purchasing a car, whether it’s a high-end brand-new luxury model or an older used car, can be a milestone in your life. So you want everything to go smoothly, including navigating the world of financing the purchase. One of the most popular ways to fund your purchase is through dealer financing, offered by most local dealerships. In this article, we’ll guide you through everything you need to know about getting a great deal on your new Mazda car.

We’re a Mazda dealership so we’re focusing on the process of getting a new Mazda car, but the steps below can apply to getting dealer financing for any car, of any model, new or used alike. So, whatever type of car your heart is set on, getting the best possible deal through dealer financing means following these steps:

1.  KNOW YOUR BUDGET AND CREDIT SCORE

Before you ever set foot in a dealership, you should understand your budget and your realistic constraints. It might be fun to have the biggest, most luxurious vehicle on the lot, but what’s less fun is not being able to afford car payments that are outside of your budget.

You should evaluate your financial situation: monthly income, fixed monthly expenses, and any existing debts. This will give you an idea of how much you can afford to spend on your new car. A general rule of thumb is that you should never purchase a car that costs more than 35 percent of your total annual income, or in other words, your car payment should be 20 percent or less than what you take home before tax. This includes car payments, gas, repairs, and any other expenses that arise.

You should also know your credit score before you head to the dealership. A higher credit score can help you get more favorable loan conditions, including lower interest rates – which can dramatically reduce the total amount that you spend on a car. If your credit score is lower than you want it to be, it might be wiser to wait until you’ve improved it before going all-in on a brand-new Mazda car.

2. COMPARE LOAN OFFERS

Before you go to a dealership, explore other financing options. If you have a local bank or credit union that you trust, you can get pre-approved for a loan. Showing up to your dealership with multiple offers in hand can get you leverage when negotiating on the most favorable terms.

Mild differences on paper can wind up having a great impact in terms of actual money spent over the lifetime of the loan. It is important to compare different aspects of your car loan:

COMPARE

• Interest rates. The percentage of the loan amount charged by the lender. A lower interest rate means lower overall costs. Just a few fractions of a percentage point can mean the difference of thousands of dollars over the lifetime of a loan.
• Loan term. This is the length of time you’ll be making payments. Longer terms will lower what you pay every month but result in higher overall interest costs since you’ll be paying interest for a longer period of time. If you can afford even a little higher payment each month, it could potentially save you thousands of dollars over the life of the loan.
• Down payment. Just like when you purchase a home, the down payment on a vehicle is the flat sum of money you put down before receiving the loan. A higher down payment will reduce the amount you pay every month, but you should only pay what you can afford.
• Total monthly payment. This is the amount you will owe every month.
• Repayment schedule. These days, most dealer financing will let you pay automatically whenever payments are due, usually at the beginning of the month. Still, double-check that you understand when, how often, and how to make payments on your various loans.

3. RESEARCH YOUR CAR MODEL AND ITS VALUE

A trustworthy dealership like Ingram Park Mazda won’t ever sell you a lemon, but that doesn’t mean that you don’t need to do research. Fancier trim options come with new features, and some of them are very nice indeed, but you should think about whether these features are really something you’ll get a lot of value out of. By being smart about the options and trim package you’re going for, you might be able to walk away with your dream Mazda for less than you might otherwise have paid.

4. ASK ABOUT INCENTIVES AND PROMOTIONS

Many dealers offer manufacturer incentives and other promotions, like cashback or rebates. It never hurts to ask about these since they can save you hundreds of dollars if not more.

5. BE WARY OF UNNECESSARY ADD-ONS AND EXTRAS

Similar to considering the trim of your preferred model, you should be ready to look over add-ons, such as extended warranties or accessories. Some of these can be very valuable indeed, but others can be overpriced or unnecessary. You should consider whether these options are worth the added cost or if they’re something you can add later when you have a little more liquidity.

6. DON’T BE AFRAID TO WALK AWAY

At the end of the day, you don’t need to leave in a new car. If the only choice is a car you don’t want to drive or can’t afford vs. waiting to find something better, you should wait to find something better. The right car will last you for years; you can wait a little longer to find the best one.If you’re looking for a new Mazda car and want dealer financing that will treat you fairly, consider Ingram Park Mazda today, your leading Mazda dealership in the San Antonio area. Choose from a selection of new and used luxury vehicles and drive away with top-notch Mazda financing.