Auto Buying Education
Auto Buying Education
- NEW & USED AUTOS FROM TRUECar
Our Member Showroom Auto Buying Program
See how much you could save on your next new or used car or truck through Magnify Credit Union's Car Buying Service powered by TrueCar. All our dealers are prescreened and dedicated to providing you with a hassle-free car buying experience, and there is never any cost or obligation to buy.
- See what others really paid on the new car you want with the TrueCar® Price Curve and get Market Reports for used cars.
- Get Guaranteed Savings through Certified Dealers in your area or view dealer-guaranteed used car prices.
- Save time and money an enjoy a hassle-free car buying experiences
Search for your new or used car now! Click Here —>TRUECar®
>What Can You Afford?
Consider this fact: For most people, buying a used or new vehicle will probably be your second largest purchase after a home! As such, you need to make sure you know exactly what your budget will support.
Some basic questions you need to ask yourself are:
- What total purchase price can I afford?
- What monthly payment can I afford?
- How much will I be required to put down?
By preparing yourself with knowledge and facts, the car buying experience can be much easier. After you have a good idea of what you can afford, add in some of the other costs associated with this purchase such as sales tax, license, registration insurance, warranty, and fuel. These items may push a vehicle out of your budget range.
Dealers would like to sell you the most expensive vehicle they think you can afford (they are a business, after all) but that may not be the right choice from your perspective. So how do you determine the price range that is best for you? Use these guidelines and tips:
- Your monthly vehicle payment should not exceed 20% of your monthly NET income. Auto Loan Calculator
- Don't forget to include sales tax and insurance costs in your budget calculations.
Using these tips should get you started, and allow you to narrow your vehicle choices considerably based on your budget.
>Deciding What to Purchase
By now you've determined how much you can afford to spend (visit: What Can You Really Afford?) Now comes the fun part - shopping! But what to buy? A Mustang? A Trailblazer? How about an F-150 or a Caravan? So many choices!
Start by looking at the following factors to help you decide:
- How many passengers will ride in your vehicle on a regular basis?
- What daily commute do you have?
- Do you need cargo space to haul things?
- Will you be taking vacations with this vehicle?
- Do you prefer a manual or automatic transmission?
- Do you live or travel in geographical areas that would require four-wheel drive?
- If you plan to park your vehicle in a garage, will it fit?
- Do you require any additional features to accommodate a special physical need?
Of course, there are many other things to consider. These will get you started! The main importance is for you to take a good look at your lifestyle and figure out what kind of vehicle fits your needs. Once you've determined a basic category, that just leaves choosing the specific brand and model. To help with that choice, you should consider how each vehicle compares in these categories:
- Safety - Obviously this is an important factor when deciding on a vehicle. Air bags have become an important feature as well as built-in child safety seats, anti-lock brakes, and traction control for slippery roads. How the vehicle rates in safety will also affect insurance costs, so stay away from those that do poorly in the crash tests.
- Warranties - Take the time to do a thorough comparison of the different warranties and what they cover. Take into consideration the duration of the warranty, deductibles, and limitations on mileage. MAGNIFY Credit Union can provide you a quote on mechanical repair coverage that is less costly that the same coverage offered by dealerships. You may want to read this article about Mechanical Repair Coverage offered by MAGNIFY.
- Fuel Economy - Gas prices are rising, with no end in sight. Check the average fuel economy rating for the vehicles you are considering, and calculate fuel costs based on the distance you typically drive. If you drive long distances to work, you might want to reconsider purchasing that full-size SUV that only gets 14.5 mpg!
- Reliability - There are several resources that provide comparisons on maintenance costs as well as the number of complaints filed on any particular vehicle model. Consumer Reports, while a fee-based service, is perhaps the best and most unbiased source for reliability ratings. Even a general web search for your particular vehicle with the additional words 'lemon', 'trouble' or 'reliability' will reveal some interesting discussion forum results. Just keep in mind that reading user forums can give a skewed perspective on the reliability of a product, since typically only the unhappy customers post messages!
- Operating Costs - Numerous publications are available that provide estimates on the yearly operating expense of a vehicle. As would be expected, these costs can have a large variance from one model to another. The main factors covered in these costs are maintenance, fuel, and tires.
- Performance - Check out the performance of the vehicle. Specifications include the size of the engine, horsepower, curb weight, gas mileage, etc. For new vehicles, all of this information should be readily available to you. For used vehicles, you may need to do some further research going back to the business that provided the maintenance.
- Insurance - Before signing on the dotted line, call your insurance company and get a quote on the vehicle. Calculate this cost into your monthly payment! You may find that you can afford the vehicle itself, but the insurance puts it beyond your budget. If this is the case, ask your agent if there is a comparable model that has lower insurance premiums.
Hopefully these tips will help you find the right vehicle for you!
Research & Compare
The following links will assist you in your purchase. Of course, you can always stop by a MAGNIFY branch and pick the brains of our knowledgeable staff. Whichever method you choose, you'll be better prepared for your vehicle purchase after you've explored all of your resources.
- Magnify Credit Union Car Buying Service powered by TrueCar (see what others have paid)
- N.A.D.A. Online
- Consumer Reports
- Fuel Economy of the Vehicle
- Find out if recalls have been completed on the auto
Rebates vs. Zero Percent Financing
Which deal do you take?
$20,000 Car with a Loan Rate of 0% or $20,000 Car with a $2,000 rebate
ANSWER: Take the rebate and finance with Magnify Credit Union!
- $20,000 car loan (no rebate) at 0% interest for 48 months = $20,000 in payments ($0.00 in interest)
- $18,000 car loan at 2.74% APY* with Magnify for 48 months = $19,025 in payments ($1,025 in interest)
TOTAL SAVINGS - $975.00 by financing with Magnify Credit Union!
As you can see, what might seem like a good deal at first really isn't! Your best move? Come see a MAGNIFY loan officer and let us help you do the math.
And honestly, if you bring in a deal that's better than financing at MAGNIFY, we'll tell you straight up. And that's the truth.
MAGNIFY Credit Union believes you want to understand the truth about zero percent financing. Here are the answers, and we'll tell you the truth.
- 0 down payment? Sure, it's quite common if you have a strong enough credit history.
- 0% financing is offered by manufacturer-owned finance companies. If the car dealer makes enough profit on the sale to cover the costs of financing, they can easily afford to charge 0% interest.
- 0 payments for six months? A year? Sure, as long as you don't mind owing a lot more on a car than it's worth! This is called being "upside down" and it's not a good place to be. If your vehicle were to be totaled in an accident (or stolen) your insurance company will only pay fair market value. And that is going to be a lot less than what you owe on the loan! So where does that leave you? Owing your financial institution the difference!
But wait, these same car makers offer large cash-back incentives too. What's the catch? Rarely will you find a quality car being sold by the maker, with a heavily discounted price and 0% financing. Remember, any cash discount offered is only excess profit the car maker is willing to forego to sell the car. Look at their financial statements—they're not losing money.
So there's a catch? Usually the dealer-offered 0% interest is reserved for what they call "tier 1" borrowers— those with near perfect credit only. The cash rebates are available to everyone. The same usually applies to low payment leases… or they require large cash down payments and excellent credit.
*Annual Percentage Rate (APR) reflects a .50% rate reduction for automatic payments and direct deposit of your entire paycheck. Rates are determined by amount financed, credit history, and term of loan. Some restrictions apply. Rates subject to change. Calculations are rounded to the nearest dollar. Example assumes $2,000 manufacturer rebate applied to $20,000 purchase price.
Safety Recalls Look-up by VIN
Owners may not always know their recalled vehicle still needs to be repaired. NHTSA's new search tool lets you enter a Vehicle Identification Number (VIN) to quickly learn if a specific vehicle has not been repaired as part of a safety recall in the last 15 years.
.25% Magnify SmartWay® Vehicle Loan Discount
Magnify Credit Union is serious about being green! Our state of the art Lakeland Branch is the first zero-energy commercial building in Florida. Our goal is to generate enough electricity from our solar panels to eliminate having to pay an electric bill! We want to encourage you to be energy efficient when buying a car by saving you money on your loan rate as well as on fuel. Magnify understands that hybrid or electric vehicles are expensive so instead, we want to reward you for purchasing a vehicle that is fuel efficient! RECEIVE a .25% SMARTWAY® VEHICLE LOAN DISCOUNT
To qualify for the discount, individuals must purchase a vehicle classified as a SmartWay® vehicle by the United States Environmental Protection Agency (EPA). Generally, the vehicle must get 29 miles per gallon (MPG) or more on the highway. TO FIND A SMARTWAY VEHICLE, CLICK HERE
You can receive this loan discount on the purchase of a new or used car or to refinance an existing loan you have elsewhere.
How does EPA determine a SmartWay® Vehicle?
To qualify vehicles for SmartWay status, the EPA looks at two criteria: traditional tailpipe pollutants and the amount of carbon dioxide (CO2) produced per mile. Of course fuel economy is figured in, too, as we shall soon see. The results are scored on a 1-to-10 scale, with "10" signifying no emissions and "5" denoting average performance.Vehicles earn a SmartWay designation when both the tailpipe pollutant score and CO2 score are 6 or greater and the combined total is at least 13. Or to say it another way, a car needs to earn at least one 6 and one 7 to qualify. The SmartWay Elite label goes to those few cars that score 9 or higher in both categories. So far, certain hybrids and CNG vehicles are the only ones able to meet the elite criteria. But the program is "technology neutral," leaving the door open for new methods to rise to the challenge.
*loan rate after discounts can be no lower than 2.25%
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