Need to buy a new car? Tips to help you get the best deal

A smart and well-informed strategy is the key to a successful car purchase. Picture: Shutterstock
A smart and well-informed strategy is the key to a successful car purchase. Picture: Shutterstock

Story in partnership with Savvy.

The cost-of-living squeeze, along with the recent rise in home mortgage interest rates, has forced many Australians to take a serious look at their budgets.

For those needing to make a big purchase like a car, the increasing pressure on finances may have prompted a rethink about their options.

But you may not have to park those plans. By taking more time and being smarter about how you approach the car selection and buying process you could find a more affordable way to drive away those essential new wheels.

While currently there are plenty of challenges to securing a car quickly, with the well-publicised shortage of used cars and delays in delivery of new ones, the recipe for getting the best deal is the same.

Spending time researching, being prepared and taking advantage of the help that's available is all part of a successful car purchase, said finance expert and CEO of Savvy, Bill Tsouvalas.

"You'll read a lot about when is the right time to buy a car but the right time to buy a car is always when you find one that checks out well and is within your means," he said.

"Doing due diligence on everything you can and being as informed as possible is what will increase your likelihood of getting a good deal that suits your financial situation."

Save when you seek car finance

One of the most critical elements to securing the best deal on car finance so you don't spend more than you have to is to plan ahead.

You need to make sure you get pre-approved on a loan so you know exactly how much you can borrow and how much the loan is going to cost you well before you step into a dealership.

"By getting pre-approval you'll secure a more competitive interest rate than using dealer financing," said Mr Tsouvalas. "It means you're also avoiding the stress of talking finance with the car dealer at a time when you might already be feeling the pressure of making a large purchase decision.

"It puts you more in control, you know what you can afford and have spent the time to be confident that you have the best rates."

With so many car loan options these days, comparison websites are your expert in helping you to sort through the offers and look into the best car loans available. Use a loan calculator to easily get a precise understanding of what you'll need to pay back each month so you can be certain it's affordable.

Be prepared to wait

Whether you're in the market for a new car or second-hand you'll find it's not going to be a quick process.

The COVID hangover means there is still a long wait on new cars, and as a result there's also been more demand for used cars which has pushed up prices.

"There are also less ex-fleet cars entering the second-hand market which is also affecting prices," said Mr Tsouvalas.

"This makes it more challenging to negotiate than pre-pandemic, so it's even more important to know your budget and to put in the effort to research the value of the cars that you're interested in."

Doing your due diligence on vehicles before you buy means you're less likely to get stuck with a lemon.

Doing your due diligence on vehicles before you buy means you're less likely to get stuck with a lemon.

Do your due diligence

To put yourself in the driver's seat when it comes to negotiating and also avoid costly mistakes, you need to know as much as possible about the history of vehicles you're interested in buying.

A PPSR (formerly REVS) check is an easy way to find out the past of the vehicle and ensure there's nothing dodgy about it that could affect its value. A PPSR search can provide a basic check for financial interests, written off records and stolen vehicles, or you can upgrade to a comprehensive report to find out even more about the vehicle's history.

Also essential is an automotive inspection for used cars. And if it's still under warranty get a full understanding of your warranty period and what's included.

"You can't know just by looking at a vehicle what's happened to it previously so this is the best way to avoid buying a lemon and then spending more money on costly repairs," Mr Tsouvalas said.

Shop around for insurance

Cars are among the most valuable purchases you're likely to make, so it makes sense to want to cover it financially in case anything goes wrong.

Fortunately these days, as with car finance, there is a lot more competition in the insurance sector so taking time to compare and review the best car insurance providers in the market means you can save yourself hundreds of dollars.

But wading through so many different companies and policies and trying compare the details of the cover is confusing and time-consuming. That's where comparison sites can also help bring clarity.

While CTP insurance protects people who may be injured in an accident is mandatory, when it comes to insuring your car you can adjust your level of cover to suit your situation while providing the security you need.

To take advantage of Savvy's services and find out more about how to find the best car loan and insurance visit savvy.com.au

Story in partnership with Savvy.