*This guest post is sponsored by  CO-OP Member Center, a wholly owned subsidiary of CO-OP Financial Services.

Auto makers have always had a calendar year of their own that rarely if ever, squares with the January to December calendar year observed by the people they hope to count as customers.  Model year 2017 cars are already arriving in dealership showrooms. And, though model year 2016’s may remain until the end of the year, the rallying cry throughout the industry – is “Everything must go!”

Interest rates are low, inventories are high, dealers are aggressively competing for your business and there are incentives aplenty. Experts predict that 17.7 million new autos and light trucks, including highly popular SUVs and pickups, will be sold this year compared to about 17.5 last year, making 2016 another record sales year.

‘Tis truly the season to buy a car at the best possible price with the best possible terms. But buyers should not take anything for granted and should do their homework.  Are you shopping for a new car? If so here are five tips for finding the best deal on that sweet new ride!

Online Research

Researching the nooks and crannies of the auto market online gives you a much wider universe to explore and you may find dealers and/or deals you didn’t know exist. A web site that is a good place to start is edmunds.com.

Sticker Price

If you are not in a hurry to purchase an auto – and we highly recommend that you never be in a hurry – comparison shopping could save you some serious money. Although not a guarantee, larger, higher volume dealers with hundreds of new and used cars on their lot generally have better pricing than smaller dealers simply because they need to move their inventory faster.

It’s possible that the sticker price on a specific auto at Dealer A could be $3,000 to $5,000 less than Dealer B even though both dealers are in the same area.

Interest Rates vs. Incentives

With interest rates at record lows, almost every dealer has an attractive financing program that takes advantage of these low rates as long as you buy your car through the dealer’s dedicated financing source.

But a loan with extremely low or even 0% financing may not be the best deal if it takes the place of dealer and manufacturer incentives such as cash rebates and upgrades that could be worth more than what is saved with the lower interest rate.

Dealers will generally offer one or the other, but not both. One way to take advantage of both, however, is to purchase an auto with the incentives package using standard financing at the going rate. Since auto loans don’t have prepayment penalties, after one or two payments you can refinance the loan at your credit union with more attractive terms and get the best of both worlds.

Pre-Approved Auto Loan

A buyer who walks into a dealership with a pre-approved loan has purchasing power that he or she would not otherwise have. With a pre-approved loan, you are in the driver’s seat and there is no need for a dealer to pull your credit report.

Many credit unions offer pre-approved loans to their members that are good up to 30 days or more, allowing members to do their research and take their time shopping around for the best deal.

Credit Unions

I’ve mentioned credit unions twice already – that’s because they are an outstanding source for great interest rates. At credit unions, interest rates can be as low as 1.5%, depending on the borrower’s credit score and length of the loan. This is an open secret – as of June for the year, credit unions captured 21% of all auto loan originations in the country.

Not yet a member of a credit union? It’s not hard to find a credit union near you that you may join.  Happy motoring in 2016 and beyond!


Are you shopping for a new car? What tips do you have for finding the best deal on a new vehicle?

About the author: John Caddell is the Credit and Lending Services Manager for CO-OP Member Center, a wholly owned subsidiary of CO-OP Financial Services.

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