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How to Buy a New Car, Part 1: Picking the Right Car

by Brian Wong (Sep 23, 2018)

(This is the first article in a five part series explaining how to buy a new car, from start to finish. To see more articles from this series, check out our news section)

Part 1: Picking the Right Car

Finding the right car can be a complicated process with lots of factors so we are here to help.

Most new car shoppers start this process by looking for the car they want, but we have an alternative: figure out which cars you can afford first. It's not a stretch to say that next to buying a home, a car is the second largest purchase that most people make. So instead of picking a car and asking "can I afford it," why not start by figuring out what cars you can afford?

Figuring out how much to spend:

A few things to keep in mind:

  • As a general rule, banks don't want you to spend more than 15 percent of your monthly income on a car payment. While this is a good rule to start with we would go even further and say it should be less than that. A new car purchase is not something to be entered into lightly, so make sure beforehand that it's something that you can afford.
  • Unsure of what interest rate you will receive? That's ok, there are a few easy ways to get an idea of what kind of rates you qualify for before you set foot in a showroom. The best way is to get a pre-approved rate for a new car loan from a bank or credit union. This not only gives you a better idea of how large your monthly payments will end up being, but it gives you an idea of your credit rating. Also, manufacturers will sometimes offer special financing rates or rebates so it's important to check for those as well (our Rebate Center is a great place to start).

Picking the car:

Everyone comes to car buying with a unique set of priorities; thankfully there are a lot of new cars for sale in all shapes and sizes. Finding one to fit your budget/needs might take some research, but ultimately there is a car out there for you.

Here at there are a few tools to help you with this search, especially Car Chooser, which allows you to narrow down the field of potential vehicles to just a handful (or just the one).

  • Size (passengers): This may seem intuitive, but it might be the most important factor when choosing a car. If it's a car for a family, then a small sports car may not be the best choice and if you plan on hauling the entire soccer team around, a minivan or large SUV may be the go to choice.
  • Resale Value: If it's not a car you plan on keeping for a long period of time, resale value, or how much value the car maintains over its life, will be an important factor. Honda and Subaru in particular feature great resale value, while on the luxury side Porsche leads the pack.
  • Fuel Economy: One of the most important features for new car shoppers is fuel economy, as more and more people are looking to save money at the pump. For those who will be using the car to commute or drive longer distances, this takes on even more importance.
  • Interests/Hobbies: I spend a lot of time driving up in the snow each winter to go snowboarding/skiing, so a car that gets fuel economy and has four-wheel drive is preferable. If there are special interests you have, look into getting a car that makes them easier and safer to do.

We would also recommend setting aside a little time to test drive a few different models you are considering. There's no substitute for seat time and you may find each new car has quirks that you will love or hate. Click here or use the box on the right side of this page to get a free new car price quote and get in touch with a dealer to schedule a test drive.

Next: Part 2 — Loan vs. Lease

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Car Buying Tools has everything you need to help you find your next new car:

  • Rebate Center: Find the latest rebates and incentives on any car you want.
  • Car Buying Guide: A fun and informative step-by-step guide to buying a new car.