Auto Buying

Buying a vehicle is an investment of time and money.

With all the options available today, choosing a car can be overwhelming and will demand a significant portion of your paycheck. Before you set out on your auto-buying journey, consider some of the tips we've outlined below.

Need help saving money on the purchase of a new or used automobile? Check out our Member Showroom through TRUECar. You'll benefit from no haggle pricing and a guaranteed savings certificate on a new vehicle. You'll also benefit from in-depth vehicle information and price reports.

Purchasing a New Vehicle

Purchasing a new car is a big investment, but there are several good reasons to buy new.

Some advantages of a buying a new car are:

  • Reduced maintenance:You can usually expect only an oil change and tune-up to be required after the first several thousand miles.
  • Warranty coverage: Most manufacturers cover their new vehicles under warranty for at least 3 years and some even longer.
  • Roadside assistance:Some new cars come with free roadside assistance while the vehicle remains under warranty.
  • State Lemon Laws: If you encounter problems with your new car, you have legal recourse through State Lemon Laws, offered in all 50 states. If you can prove your car is a lemon, you could receive a replacement vehicle or get your money back.
  • Customization: Choose custom features tailored to your needs and wants.

There are a few disadvantages to buying a new car including:

  • Buying new is a large financial investment that requires serious commitment.
  • You could have higher monthly payments.
  • As soon as you drive off the lot, your car immediately begins to lose value.
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Purchasing a Used Vehicle

Used vehicles have lost the stigma of being a "junker” and are a very viable option when purchasing a vehicle. Cars that are only a year old are 20-30 percent cheaper than their new model year counterpart.

Other advantages of buying a used car include:

  • Lower registration and license fees.
  • Lower insurance premiums.
  • Bigger bargains are available.
  • Some used cars are still covered by the factory warranty.
  • Most new carmakers now sell Certified Used Cars, which do include warranties.
  • The history of a used car can easily be traced using the vehicle identification number (VIN).
  • If you buy from a private party, the negotiation process is less stressful.

There are a few disadvantages to buying used which include:

  • You may not be getting the newest technology.
  • Chances for needed repair expenses are higher.
  • Reliability may be reduced and major maintenance repairs are possible.
  • You may not be able to choose custom features.

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Do Your Research Before You Buy

Before you start going to dealerships to test drive your dream car, do your research. Figure out how much you can spend on a car, decide what type of car you need and ask yourself if you should buy a new or used car. At Heartland FCU, we have the knowledge to help you make this major financial decision. Here are some factors to help you decide:

How much can you afford to spend on a car?
There are so many creative ways to finance a car that you may fool yourself into thinking you can afford to buy a more expensive car then you should. One basic rule of thumb is that you should only finance your car for a three-year term. If you can’t afford the payment for a 3 year term, then you can’t afford the car. Watch out for dealers just trying to make a sale. They may make you believe you can afford a payment when you really can’t. Only you truly know what’s right for you.

What type of car do you need?
Consider your lifestyle and needs when making your decision. Unless you have a job that requires a luxury car, steer away from them until you can pay cash. Do you need an SUV or will a small compact car suit your needs just as well? With high gas prices, a smaller car or a hybrid vehicle could be the way to go.

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Information is power, knowing where to look and what to look for online, can give you the advantage of knowing exactly how much you intend to pay before you even show up at the dealership. Using websites like or, you can find out the dealer’s cost for any vehicle. You can also find out about customer or dealer rebates, subsidized lease deals, or other special breaks that can cut your costs. When you get to the dealership you should already have an idea of how much you plan to spend for a car and where you plan to start bidding. Start the bidding as low as possible, but not so low that you seem like an uninformed buyer just throwing out a random price. If you don’t like what the salesperson is giving you for a price, walk away. Take it to another dealer, if the second dealer beats the price of the original offer, keep the competition going — bring it back to the first dealer. When you’ve hit your target price or come as close as you think you can, agree on the price.

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Time it Right

If you are not in a rush to make your purchase, be sure to consider the time of year when making your decision: late summer/early fall is a great time to buy as dealers are anxious to get all the old models off the lot to make room for shipments of new ones. Another time of the year where you can usually land a bargain is at the end of the month. Most car dealerships generally operate on a quota system, where they receive a bonus each time they hit their next sales "mark” for that month. If a salesperson is coming up on the end of the month and they’re a few cars short of their bonus, he or she usually has an incentive to get the sales manager to knock down the price of a car in order to hit the quota.

Do the math

Low rates are great, but long-term loans often accrue more interest. Keep an eye on the total long-term price AND the monthly payment. Use our calculators to help you map out the scenario.

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Drivers pay insurance companies a premium in order to be covered in the case of an auto accident. When an accident occurs, a driver files a claim with the insurance company and usually pays only the amount of the deductible. It can often be confusing to decide which insurance plan is most appropriate for your needs. Many people are inclined to get the bare minimum liability insurance coverage required by the law in your state. That's a good place to start, though those minimums may not fully protect you — or your assets — if you file a claim. If you are financing your vehicle purchase, you will be required to carry full coverage insurance until the loan is paid off. Besides various forms of liability insurance, there is collision and comprehensive auto insurance coverage to consider. Collision covers damage to the policyholder's car resulting from running into anything, another car, a fire hydrant, or a light post. Comprehensive coverage takes care of your car in the case of theft, fire, falling objects, explosions, or other unexpected problems. When you purchase a vehicle and fund it with a Heartland FCU loan, you gain access to additional insurance coverage including Guaranteed Asset Protection (GAP) Coverage. GAP coverage helps pay the difference (the "gap") between your insurance settlement and the outstanding balance of your car loan. Heartland also partners with Robert K. Jones Insurance Agency. They offer a wide range of insurance options from car and homeowners to life and health insurance; they are your one stop shop for all your insurance needs.

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Where you finance your vehicle matters, too. Not all lenders have your best interest in mind. At Heartland FCU, our members always come first so you can be assured that we will put you in a loan product that fits your budget and benefits you.

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