Jane Skinner has just graduated from college and would like to purchase her firs

Question

Jane Skinner has just graduated from college and would like to purchase her first car. She is unfamiliar with the purchasing process but thinks that she could probably afford to pay about $350 per month on a loan or lease. She has about $3,000 in her savings account to use as a possible down payment. If you were asked to guide her through this buying experience, what types of advice would you give her as far as researching the car, buying new or used, negotiating the price, and financing the loan?

Explanation / Answer

For the research on the car I would tell her to buy one that is fuel efficient, preferably electric, and has a long life span for its auto parts. For buying new or used, I would advise her to buy a care that would meet her demands. If she needs a car for a short period of time then buy used, if she needs one for a long period of time buy new.
As far as price negotiation I would tell her to hold out for the lowest possible price with her dealer and not to give in too soon. For the financial loan I would advise her to borrow as little as possibly and to map out her future income to assure that she will have enough and not default on her payments.

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