One of the most crucial car-buying tips that can help you save thousands on your next purchase is getting pre-approved for financing. Opting for certified pre-owned (CPO) and researching out-the-door prices (fair market value) are just as vital.
Learning about red flags and the don'ts of car buying can also help make your shopping expedition a success.
By considering savvy car-buying advice and recommendations, you can minimize the financial impact of purchasing and owning a motor vehicle. As CNBC News reports, new car prices now hover around $50,000.
It's a lot of money, but with the right strategies, you can change gears in your next reliable car for less.
What Is a Red Flag When Buying a Car?Â
Scams related to car buying are on the rise, from deals with "too good to be true" pricing to odometer fraud.
Auto loan fraud is particularly booming. As CBS News notes, consumers filed over 60,000 complaints with the Federal Trade Commission (FTC) in 2024 and over 21,400 complaints in the first quarter of 2025 alone.
Recognizing and spotting red flags during your shopping expedition should, therefore, be part of your list of must-adhere-to car-shopping tips.
Too-Good-To-Be-True Pricing
Too-good-to-be-true pricing is when scammers offer exceptionally low prices, particularly for desirable makes and models. They take advantage of buyers' desire for bargains, something that the ever-increasing price of new cars has amplified.
Odometer FraudÂ
Odometer fraud is when scammers alter the odometer (e.g., roll back or disconnect), making it display a lower reading. You may be able to spot this scam by comparing the vehicle's condition with the numbers on the odometer's display.
If the odometer only reads a few thousand miles, but there's heavy wear and tear on the steering wheel, pedals, and tires, chances are you're dealing with a scammer.
Auto Loan FraudÂ
Many scams occur within the used car industry, but auto loan fraud can affect both new and pre-owned vehicle buyers. It can occur through synthetic identity fraud, in which a scammer applies for an auto loan under your name or uses your identity as a co-borrower, even though you don't know this person.
What Should You Not Do When Buying a Car?Â
As KIRO7.com points out, the yearly cost of car ownership and operation has reached $12,297 (as of 2025). If you make mistakes, your expenses could end up being much higher. The following things are things you shouldn't do when buying a car:
- Not saving (as much as you can) for a down payment
- Falling in love with a specific model, even though it could be beyond your budget
- Going to a dealership without a financing offer
- Placing the focus of the negotiation on the monthly payment alone
What Car-Buying Tips Can Help You Save Thousands on Your Next Purchase?
Aside from knowing the "don'ts" of buying a car, you should familiarize yourself with auto pricing, financing strategies, and dealership tips. Start with the following tactics, as they can help you unlock thousands in savings.
Getting Pre-Approved for FinancingÂ
When you get pre-approved for an auto loan, you can save thousands, as it can help you lock in a lower rate. The rate you'd get will most likely be more competitive than what dealerships would usually offer initially, particularly if you go to them without a pre-approved financing offer.
You can use your pre-approval as a powerful negotiating tool, as this prevents dealers from marking up their financing offers.
Opting for Certified Pre-OwnedÂ
Certified pre-owned (CPO) vehicles, such as those offered by a reliable, quality Ford dealer serving Jackson area residents in Tennessee, are manufacturer-backed used cars.
CPOs aren't brand-new, but they've passed strict, multi-point inspections (MPIs) based on manufacturer standards and requirements. If necessary, they would've also undergone refurbishment to meet high standards.
Compared to typical used vehicles, CPOs have:
- A lower mileage
- A clean title
- A longer extended warranty
- Other guarantees and perks, such as roadside assistance
CPOs typically cost more upfront than their standard pre-owned counterparts, but their sticker prices are lower than brand-new ones.
Researching Out-The-Door PricesÂ
"Out-the-door" prices refer to a vehicle's total purchase price required to "drive it off" the lot. It covers all related expenses, including:
- Negotiated vehicle price
- Sales tax
- Title fees
- Registration
- All other dealer fees (e.g., processing and documentation charges)
Researching such prices can help you save on your next vehicle purchase because it lets you compare true bottom-line offers more accurately than just the base manufacturer's suggested retail price (MSRP). It's another tool you can use for more effective negotiation.
Frequently Asked Questions
What Is the 20/3/8 Rule of Buying a Car?
Understanding the 20/3/8 rule when buying a new car and adhering to it as much as possible can also help you save loads, as it reduces the amount of interest charges you'd have to pay.
The "20" stands for making a 20% down payment. It lowers the loan amount you need and the interest fees that would apply.
The "3" pertains to aiming for a maximum of 3 years (or 36 months) for your loan term. The shorter your term, the less time the lender can charge you interest.
The "8" refers to limiting your monthly car-related expenses to a maximum of 8% of your gross monthly income.
What Are Some Car Loan Tips to Boost Your Approval Rate?Â
Improving your credit score should be one of your top priorities, as this can help boost your approval rate not only for auto loans but also for other types of credit (e.g., mortgages). Ensuring you always pay your dues on time and lowering your debt-to-income ratio are excellent ways to start.
Get a free copy of your credit report, too. Check for any erroneous entries, which could lower your credit score, and if there are any, dispute them with the credit reporting agencies (e.g., Experian, Equifax, or TransUnion) as soon as possible.
Save Money With These Car-Buying Tips and Tactics
The average transaction price of new vehicles will likely keep going up, which is all the more reason to familiarize yourself with car-buying tips, such as getting pre-approved for financing, opting for a CPO, and being a better negotiator.
Explore other related reads, informative guides, and the latest local and national headlines by browsing more of our news platform.
This article was prepared by an independent contributor and helps us continue to deliver quality news and information.
