lesson 10.2 purchasing a vehicle july 2011copyright © 2007-2011 … remtech, inc … all rights...

Lesson 10.2Purchasing a Vehicle

July 2011 Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved 1

Introduction

Buying a vehicle generally involves a lot of money

Buying a vehicle can affect your finances for 2 to 8 years

It is essential to know how much you can afford to spend

In general, if you can’t afford it now, you shouldn’t buy it.

Basing purchasing decisions on what you think will happen in the future equates to gambling with your

future financial wellness.



Objectives

• List questions a lender will ask before approving a loan

You should be able to do the following after completing this lesson.

• Explain how a lender determines how much money to loan

• Describe the different ways you can pay for a vehicle

• Discuss how your credit history will affect your interest rate

• Identify the advantages/disadvantages of buying a new vs. a used vehicle

• Summarize the general types of vehicles

• List multiple ways you can research different vehicles

• Define the key terms introduced in this lesson



10.2.1 – Auto Loan Standards

• How lenders decide if they will loan you money

• How lenders apply the common standard for auto loans

• How your credit score is used in the loan process

In this section, you will learn

• How lenders decide the interest rate they will charge you

• How lenders decide how much money they will lend you

• Affordable Range Example

You will run the following Interactive Example



10.2.2 – Purchase Options

• What the purchase options are when buying a vehicle

• The factors to consider when paying for a vehicle


• Where to go when you need a loan

• What factors affect the interest rate of a loan

• What you need to do prior to applying for a loan



10.2.3 – Shop Around

• Why you should visit multiple dealers before buying• What credit terms are and why they are important• How a small change in the interest rate can

have big affects

• What typical incentives are offered to the buyer


• How dealer and manufacturer incentives can help reduce the cost of buying a vehicle

• Purchase Terms Comparison Example

You will run the following Interactive Example



10.2.4 – New or Used?

• Why some people like to purchase new vehicles

• How depreciation will affect the value of your vehicle

• Why some people choose to purchase used vehicles


• Why the manufacturer’s warranty is important for both new and used vehicles



10.2.5 – Type of Vehicle

• How many different manufacturers of vehicles exist today


• How many different types or classes of vehicles exist today

• How you should go about deciding what type of vehicle to purchase



10.2.6 – Vehicle Options

• About the different automobile manufacturers

• Why vehicle color is a key factor

• What types of engines are available today

• The different types of interiors you can select from

• What special options are commonly offered


• How selecting special options will affect the purchase price



10.2.7 – Research

• Why the more you know before you purchase, the more satisfied you will be after you purchase a vehicle

• What the different ways to research vehicles are

• What types of information can be found when researching different vehicles




10.2.8 – Test Drive

• What a test drive is

• Why it is important to see and drive vehicles before purchasing

• Why advertising and pictures can be misleading

• Why it is important to develop your expectations before you begin looking for a vehicle


• Why you are not ready to purchase a vehicle at this point



10.2.9 – Negotiating the Price

• Why it is critical to visit multiple dealers

• How each dealer is unique and can have a different selling philosophy

• What markup is

• How car salesmen are paid


• How to find the market or going price in the area

• Why the selling price is negotiable at all car dealers



Discussion Questions

How do individuals with bad or no credit obtain auto loans?

How do vehicle options affect the resale value of a vehicle?

lesson 10.2 purchasing a vehicle july 2011copyright © 2007-2011 … remtech, inc … all rights...

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