Before you buy your first car, there are a few notes you should take before heading to the dealership. These are tips I wish I was given before I pulled off the lot, dropping 10,000 dollars of my own money on a 2016 Toyota Corolla. While it wasn’t my first car, it was first car that I ever had to finance and purchase from a dealer. So whether you’re transitioning from Craigslist Beater to A-List Hot Rod, or helping someone do the same, follow these tips to save yourself time, money, and a migraine.


Products for You | Low or No Credit First Time Auto Buyers Program


How Will You Finance Your First Vehicle?

The biggest takeaway I can suggest as a new car buyer is to know where your loan is coming from! The dealership can feel intimidating, and for good reason. For some, browsing the vehicle lot is just window shopping. For others, they need a new car today. If you fall into the latter category, going home car-less isn’t an option. It can be easy to get flustered by all the Terms and Conditions being thrown in your face, so save yourself the stress by knowing how you’ll negotiate your loan.

Dealer Financing/Indirect Auto Loans-

If you don’t have a preference on where you get your loan, you can go through the dealer for lending. Most dealerships partner with a bank or credit union to offer indirect auto loans to consumers and will traditionally arrange the financing with the lender. Make sure you ask the dealer these two questions before you agree to an indirect auto loan

  1. What’s the length of the loan?
  2. What’s the monthly payment with and without a Down payment?

H3 Direct Financing- If you have a financial institution that you already trust with your banking, then a direct auto loan is for you. If I could go back in time, I would get a direct auto loan from my financial institution. That’s not to say an indirect auto loan lacks merit or are bad for the consumer, but because I want more control of my loan. While there’s beauty in the simplicity of Indirect Auto Loans, the ability to shop around and compare rates, is what makes Direct Financing a more preferable option to many (including myself).

Get in Control of Your First Vehicle’s Financing

IF you’ve decided to get a loan directly from a bank or credit union, now is where the fun begins. That’s if you define fun as checking rates and crunching numbers. Before you head to the dealership with your loan, check these off your list.

Check the APR

Before you even step foot onto the lot, know your APR and your rates. A high interest won’t make up for low mileage, and you’ll want to know you can foot the bill before you put your foot on the pedal. You can easily check your rate and get approved for a loan with online preapproval, such as the one from First Commonwealth. 

Online Preapproval is your Wingman

Preapproval online is the quickest way to confirm your rate. Besides finding out how much your  lender is willing to loan, working ahead will get you out of the dealership quicker. With new and used automobiles pulling out of the lot quicker than ever before due to manufacturer shortages, avoid a possible credit check hiccup at the dealership to make sure you get the car you desire.

New Vs Used Rates for Your First Car

Society shouldn’t judge you for driving a new or used car, and neither should your financial institution. If you’re loan lender offers different rates for new or used automobiles, maybe its time to look elsewhere. Now you won’t have to decide between that Matte Black 2022 Tesla or that 2014 Ford Focus with the racing stripe.

Insurance Contributes to the True Cost of your Car

If you’ve got a car in mind, call your insurance provider to get an estimate on how much you’ll pay to protect your ride. Depending on the make, model, and even color of the car you’re looking at, you could face an increase in your premium.

Set a Budget that Will Stick

Now that you’ve done the research, shopped vehicles, insurance, and lending options, its time to see if it will fit your budget. Buying a car is a big deal, and is a financial obligation you’ll be paying for years to come. How long you’ll be paying your car loan with also line up with your rate. Plan on paying your car off in 60 months? You’ll be paying a lower interest rate than if you decided to pay it off in 84 months.

Next Steps with No or Low Credit Approval

Even with no credit history, FCFCU has your back. Join First Commonwealth to see how you can get a discount on your rate as a first time car buyer. With no co-borrow required, the First-Time Auto Buyer Program is the perfect way to get out of your rust-bucket



Written by Andrew K