On July 1st, 2006, a landmark consumer protection bill became law in California. Known as the Car Buyers Bill of Rights, this bill has been more successful at confusing the public than it has been at eliminating predatory dealer practices. In it's final realization, it is an abject example of what can happen when well-meaning consumer groups make unrealistic proposals and settle for impractical solutions. Key features of the bill include:
• Imposing a limit on the interest rate markup allowed to dealers when arranging an auto loan.
• Setting more specific criteria for cars that are to be sold as 'certified'.
• Establishing a two-day return option for buyers of used vehicles.
• Requiring dealerships to disclose to customers, in writing, their credit scores and the source of the information.
The GOOD: Capping the interest rate markup on loans arranged by dealers is the most important feature of this bill. This legislation places a markup limit of 2 1/2% on loans of 60 months or less, and 2% for longer terms. These are fair numbers for all concerned, and are close to the self-imposed limits that many respectable dealers had placed on themselves. It is worth noting that the original proposed legislation sought to eliminate this fee altogether, which would have placed dealers in the position of working as loan brokers without compensation.
The BAD: This legislation was originally aimed at all car dealers, but the 'cooling off period' is available only to used car buyers. So, if your new car does not please you...too bad! The 'cooling off period' does not apply to new car buyers.
Being 'forced' to reveal the credit score to someone who did not check it out before trying to buy a car seems....well, let's face it: If you did not check your credit before going out to buy a CAR, either you are A) rich and don't care, or B) have perfect credit, or C) Your credit is so bad that it doesn't matter what the number is...you just want to buy a car!! A raw credit score does not mean anything whatsoever to someone who does not approve loans for a living.
The UGLY: Talk about "fine print"! Car dealers are allowed to charge for the two-day return option! In other words, instead of creating a protection for buyers who feel they have been victimized , this bill has created another profit source for the dealership!
" Mr. Jones, for only $300 you can have the peace of mind......"
For a vehicle priced at more than $10,000 , a $500 restocking fee may be charged. This is assuming that you came back within 48 hours, drove fewer than 250 miles, and were able to comply with all other provisions, stated or not. Who will go through all of that? Not many, even if they are not happy with their deal. Who will pay for the 'concept' of the right to go through all of that? Quite a few do. It is difficult for folks to consider the implications of these "only $5 dollars a month" options when they come flying at them out of the blue. "This is only to protect YOU" or " This is an option the state requires us to offer for your protection". See what I mean?
AS ALWAYS, the best advice is to deal with people you know and trust. The typical car buyer will spend hundreds of thousands of dollars buying cars in their lifetime. It is essential to develop relationships with the sellers of vehicles. Talk to people you know, check with the Better Business Bureau, know where and from whom you will be buying your car from before you go out to do it!. DO NOT go driving from lot to lot hoping to find a car that "speaks to you". If the car really could speak to you, it might tell you to run away.
Claim your copy of 'The 7 Biggest Mistakes Car Buyers Make' at http://www.car-fu.com Peter W. Robinson is the founder of Movinmetal, Inc. and creator of the 'CAR FU: Self-Defense for Car Buyers' car buying system.
Article Source: http://EzineArticles.com/?expert=Peter_W._Robinson
Thursday, April 3, 2008
Myths of Car Buying and Bigfoot
Have you been studying up at the websites? Edmunds, Kelly Blue Book, etc.? Is it helping you prepare, or is it WAY too much information for anyone to absorb? Let's simplify this a little bit. Here are some common myths, or "advice" from apparently well-meaning buyer guides that are...well...stupid!
"Don't tell 'em you have a trade-in until you have agreed on a price for the one you are buying".
Um...NO. Why would you do that? Besides the fact that lying or misdirecting is an unnatural and uncomfortable process for most people, besides all the time it will cost you--HOURS--as they now have to appraise your trade and put an accurate value on it (while fantasizing about stabbing you in the chest), it has skewed your financing deal because your interest rate quote was based on a certain LTV(loan to value) that has now changed. If you did not work a financing deal, and decided only on a purchase price, you have locked that price in and left only one more negotiable item. It is much easier to try to work the edges of a negotiation when you have another variable. Your trade-in will not suddenly gain (or lose) value. EVER. It is worth what it can be sold for at that moment, never more. Depending on several subtle factors, or the skill(or lack thereof) of the appraiser, one can gain a small monetary advantage or concession on occasion. But when dealers move money from one car to the other, it is because that is what you are telling them you want to see. "Give me more for my trade!" Okay, here you go. "Hey, what happened to that other price?" If you know where the numbers should fall on both vehicles, you will at least be able to squeeze from both sides. Just like they will be doing!
"Don't talk about monthly payment"
Okay, but isn't that how you work out your own budget? By the month? So, if your main deciding factor is the monthly payment, then perhaps you should mention that. Of course, you have already figured out what your interest rate should be and the term of the loan before you got there, didn't you? No? We should probably slow things down a bit, then.
By the way, obtaining your own financing will eliminate this step. Why not do that right now?
"Beat the dealer"
Huh? How will you beat the dealer? If they sell you a car, they have been successful. That is what they do. If the deal is not advantageous to them, they will not sell you a car. When you enter into any event in your life with the idea that someone else has to lose in order for you to be successful, that event is taking too much from your life-force and should be put on hold.
If you are happy with your deal, if you have the car you want and are paying the amount you determined you could comfortably pay, then you have been successful. Be happy! That is the very definition of winning a car deal, and if you need more evidence that you won, take a victory lap around your neighborhood, around your part of the world. See the sun, the sand, the mountains, the ocean ? Yep, you won.
Oh, yeah..."Bigfoot"? Just a giant prehistoric ape-like creature that lives in the Pacific Northwest. Nothing more.
Claim your copy of 'The 7 Biggest Mistakes Car Buyers Make' at http://www.car-fu.com Peter W. Robinson is the founder of Movinmetal, Inc. and creator of the 'CAR FU: Self-Defense for Car Buyers' car buying system.
Article Source: http://EzineArticles.com/?expert=Peter_W._Robinson
"Don't tell 'em you have a trade-in until you have agreed on a price for the one you are buying".
Um...NO. Why would you do that? Besides the fact that lying or misdirecting is an unnatural and uncomfortable process for most people, besides all the time it will cost you--HOURS--as they now have to appraise your trade and put an accurate value on it (while fantasizing about stabbing you in the chest), it has skewed your financing deal because your interest rate quote was based on a certain LTV(loan to value) that has now changed. If you did not work a financing deal, and decided only on a purchase price, you have locked that price in and left only one more negotiable item. It is much easier to try to work the edges of a negotiation when you have another variable. Your trade-in will not suddenly gain (or lose) value. EVER. It is worth what it can be sold for at that moment, never more. Depending on several subtle factors, or the skill(or lack thereof) of the appraiser, one can gain a small monetary advantage or concession on occasion. But when dealers move money from one car to the other, it is because that is what you are telling them you want to see. "Give me more for my trade!" Okay, here you go. "Hey, what happened to that other price?" If you know where the numbers should fall on both vehicles, you will at least be able to squeeze from both sides. Just like they will be doing!
"Don't talk about monthly payment"
Okay, but isn't that how you work out your own budget? By the month? So, if your main deciding factor is the monthly payment, then perhaps you should mention that. Of course, you have already figured out what your interest rate should be and the term of the loan before you got there, didn't you? No? We should probably slow things down a bit, then.
By the way, obtaining your own financing will eliminate this step. Why not do that right now?
"Beat the dealer"
Huh? How will you beat the dealer? If they sell you a car, they have been successful. That is what they do. If the deal is not advantageous to them, they will not sell you a car. When you enter into any event in your life with the idea that someone else has to lose in order for you to be successful, that event is taking too much from your life-force and should be put on hold.
If you are happy with your deal, if you have the car you want and are paying the amount you determined you could comfortably pay, then you have been successful. Be happy! That is the very definition of winning a car deal, and if you need more evidence that you won, take a victory lap around your neighborhood, around your part of the world. See the sun, the sand, the mountains, the ocean ? Yep, you won.
Oh, yeah..."Bigfoot"? Just a giant prehistoric ape-like creature that lives in the Pacific Northwest. Nothing more.
Claim your copy of 'The 7 Biggest Mistakes Car Buyers Make' at http://www.car-fu.com Peter W. Robinson is the founder of Movinmetal, Inc. and creator of the 'CAR FU: Self-Defense for Car Buyers' car buying system.
Article Source: http://EzineArticles.com/?expert=Peter_W._Robinson
Benefits Of An Extended Auto Warranty And Determining If This Is Right For You
When you purchase a car you will be offered various options to purchase alongside of it and one such option is that of an extended auto warranty. When considering whether to get this type of warranty for your automobile you should be aware of the benefits which coincide with such an option and this will help you to determine if an extended warranty is the right choice for you.
Benefits of an Extended Automobile Warranty
There are a few benefits of obtaining this type of warranty. First, it will provide the owner of the car with peace of mind in knowing that various aspects are covered. Since each warranty will differ with regard to what is covered under it, it is important to peruse the document to see which coverage points are included. By selecting an extended warranty you will know that you have certain areas covered on your automobile should anything happen which results in the car needing to be fixed.
Extended warranties will also ensure that your financial investment is protected. Since many individuals live on a budget it is a good idea to put forth the funds when you have them so that you will not be caught short in the future should something go wrong with the automobile and you will have to get it fixed.
In addition, the price of an extended auto warranty is often much more reasonable than what you would have to pay should you need to get your car fixed in the future. Therefore, by spending a smaller amount of money in the beginning you may save yourself quite a few dollars in the end should repairs or replacement parts be necessary for your automobile.
Is This Warranty Right For You?
When determining whether or not to get this type of warranty you must look at a few of the finer points to see if this type of warranty is right for you. One thing you should consider is what types of coverage items are included within the warranty. For example, if the warranty covers only replacement parts but not time and labor expenses then perhaps obtaining this policy may not be a good investment for you since labor can be quite pricey. On the other hand, if the warranty includes all the necessary repair costs you could possibly imagine yourself having to pay in the future then maybe getting the extended warranty would be a wise choice.
Another factor to consider in order to decide whether this type of warranty is right for you is the cost of the warranty. If the total cost of obtaining such an automobile warranty is reasonable in amount then it may be a good deal. On the other hand if the price of the extended auto warranty is obscenely high then maybe foregoing obtaining such a warranty for your automobile is the right choice to make.
Craig Thornburrow is an acknowledged expert in his field. You can get more free advice on extended auto warranty and auto extended warranty review at http://www.extendedautowarrantyadvice.com
Article Source: http://EzineArticles.com/?expert=Craig_Thornburrow
Benefits of an Extended Automobile Warranty
There are a few benefits of obtaining this type of warranty. First, it will provide the owner of the car with peace of mind in knowing that various aspects are covered. Since each warranty will differ with regard to what is covered under it, it is important to peruse the document to see which coverage points are included. By selecting an extended warranty you will know that you have certain areas covered on your automobile should anything happen which results in the car needing to be fixed.
Extended warranties will also ensure that your financial investment is protected. Since many individuals live on a budget it is a good idea to put forth the funds when you have them so that you will not be caught short in the future should something go wrong with the automobile and you will have to get it fixed.
In addition, the price of an extended auto warranty is often much more reasonable than what you would have to pay should you need to get your car fixed in the future. Therefore, by spending a smaller amount of money in the beginning you may save yourself quite a few dollars in the end should repairs or replacement parts be necessary for your automobile.
Is This Warranty Right For You?
When determining whether or not to get this type of warranty you must look at a few of the finer points to see if this type of warranty is right for you. One thing you should consider is what types of coverage items are included within the warranty. For example, if the warranty covers only replacement parts but not time and labor expenses then perhaps obtaining this policy may not be a good investment for you since labor can be quite pricey. On the other hand, if the warranty includes all the necessary repair costs you could possibly imagine yourself having to pay in the future then maybe getting the extended warranty would be a wise choice.
Another factor to consider in order to decide whether this type of warranty is right for you is the cost of the warranty. If the total cost of obtaining such an automobile warranty is reasonable in amount then it may be a good deal. On the other hand if the price of the extended auto warranty is obscenely high then maybe foregoing obtaining such a warranty for your automobile is the right choice to make.
Craig Thornburrow is an acknowledged expert in his field. You can get more free advice on extended auto warranty and auto extended warranty review at http://www.extendedautowarrantyadvice.com
Article Source: http://EzineArticles.com/?expert=Craig_Thornburrow
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