The Complete Guide To Buying A New Car: What To Look For In A New Car

  1. The Complete Guide To Buying A New Car: Introduction
  2. The Complete Guide To Buying A New Car: What To Look For In A New Car
  3. The Complete Guide To Buying A New Car: How To Negotiate Prices
  4. The Complete Guide To Buying A New Car: How To Finance A New Vehicle
  5. The Complete Guide To Buying A New Car: Conclusion
When shopping for a new vehicle, the world is your oyster. Every vehicle in every automaker's lineup is available for your perusal. You can purchase a fully loaded minivan for those big family vacations, a sleek new sports coupe for your next mid-life crisis toy or a stripped down compact for your new college graduate. The sky is quite seriously the limit. With hundreds of different models of sedans, sports cars, trucks and SUVs on the market right now, it's up to you to pick out which type of vehicle suits you best. This isn't as tricky as it sounds. Once you know what size vehicle you're looking for, you can do research online to figure out which ones you'd like to test drive. To help you out, here are some things you should consider when narrowing down your list of new cars.

Automakers offer just about every feature imaginable on their newest model year vehicles. Some will make your car more comfortable, others make it more attractive and some will even make it safer. Depending on your price range, some of these features like heated seats and darkness-detecting lights may come standard. In other cases, you'll have to pay extra for anything above the baseline. Since some of these features are worth more than others, we've created a rundown of everything you'll be able to add to a new car accompanied by our opinion on their values.

Interior Features
Backup Cameras
Backup cameras can be incredibly useful gadgets if you find yourself needing to Parallel Park regularly. They can make squeezing into a space easy for even the shakiest parkers. And the technology they use is constantly becoming more advanced. The backup cameras featured in Infiniti's 2013 lineup can monitor a 360-degree area around your vehicle and alert you if you're about to hit something. The only downside is that these cameras are usually included as part of a "premium" package on midrange cars, making them a bit pricey for some budgets.

Remote Entry
Remote entry has come a long way in the last couple of years. Every new model comes with a remote key fob these days and you can unlock many of them simply by approaching the car with the key in your pocket. The newest models of the Ford Escape and Mercedes-Benz SUVs offer hands-free access not only to the doors, but also to the back hatch as well. Just wave your foot under the bumper and the door will open on its. If you have to haul a lot of things around, this will definitely be a useful investment.

Inductive Charging
Those power mats that charge your electronic devices just by touching them have finally made their way to vehicles like the new Dodge Dart. Unfortunately, these mats are often more trouble than they're worth – you have to install an accessory onto every device you wish to charge plus you need to pay the dealership a premium to install the mats in the first place. In our opinion, you should just stick to the good old fashioned outlet chargers that you can buy for about $10.

Heated Seats
Nothing feels better than a warm seat after you've just come in from the rain or snow. However, their utility is limited unless you live in area that sees a significant amount of inclement weather. Luckily, most vehicles that offer heated seats include them as a standard feature. If your vehicle requires you to upgrade to heated seats, you may not t be missing much by skipping them.

In-Car Wi-Fi
Some automakers like Dodge offer the option to turn your vehicle into a mobile Wi-Fi hotspot. It's a novel idea, but we really don't see the value in it, especially considering the pricey subscription required to use the service. Unless you take monthly family vacations and every one of your children has their own iPad to play with, we think you'd be better off just browsing the Internet through your cell phone provider.

Automatic Temperature Control
Automatic Temperature Control typically comes with the first upgrade package above the baseline model of a vehicle. In our opinion it's an incredibly useful investment. Not only will automated air conditioning and heat keep the temperature in your vehicle constant using a thermometer, it can actually save you money on gas in the long run.

The value of a sunroof is a controversial topic here in the Investopedia offices. While there's a lot to be said for driving with an automated sunroof on a summer's day, this upgrade typically only comes with the highest-level vehicle packages like the "Titanium" Ford models and the "Limited" Hyundai cars, making it an expensive indulgence. If you can't be happy without one, then take the plunge. However, don't feel bad if you can't justify the cost of clearing up your roof.

In-Car Navigation
What's the difference between a Garmin navigator and an in-car navigation system? + Sure, those touch screens might look cool, but they're little more than a useless sales gimmick. There are only three reasons your car should have an installed navigation system: 1) You had to get one to get a backup camera, 2) You had to get one to get a sunroof and 3) You bought a luxury model that comes with navigation standard. Other than that, avoid these at all costs.

Leather Seats
Leather or no leather? It's oldest question of preference in the book. Cloth seats are pretty comfortable in our opinion. Leather seats are also comfortable – more comfortable, according to some of us – and they're easier to clean and don't hold the smell of smoke as long as cloth. But leather seats can also get volcanically hot or frigidly cold depending on the weather, and they cost about a thousand dollars more to install. So that's something to consider when making your decision.

SEE: 5 Best-Selling Cars Ever

Exterior Features
Power Doors
In our experience, power sliding doors on minivans are more trouble than they're worth. An able bodied passenger will be able to open and close the door much more quickly on their own. And in many cases they would prefer to do just that instead of wait the fifteen seconds it takes for the motor to open the door for them. On the other hand, power hatches and trunks certainly have their utility when trying to put away groceries or luggage. If you want powered portals, skip the former and invest in the latter.

Rooftop Storage Racks
If you take long trips or want to carry large cargo like bikes and kayaks, rooftop storage racks can definitely be useful. However, many automakers charge up to $500 to get a roof rack installed when you buy. Since you can get an aftermarket rack that fits your vehicle for as little as $200, we recommend waiting to put the rails on yourself.

Tow Packages
Tow packages are a curious feature. If you tow a lot of cargo, then getting one is a no-brainer. If you don't tow things often but your vehicle has the capacity to do so, we recommend picking one up anyways. Even if you only use the tow package once every five years, the one time you use it will still make the investment worthwhile. Plus, tow packages make an excellent mount for a bike rack and other carriers.

Upgraded Wheels
If you don't like the stock wheels on your new vehicle, then do yourself an upgrade them before you buy. Upgraded wheels produced by the manufacturer cost about half as much as aftermarket alloy rims – sometimes as little as $500 for the set – and don't charge you an additional premium for installation.

Mud Flaps, Bumper Guards, Paint Protection, Etc.
Though we hate to be the bearers of bad news, we feel compelled to tell you that any "small" exterior features like a paint protecting film or mud flaps simply aren't worth the money. At least not at the price most manufacturer's charge for them. If you're interested in a bumper protector or any other exterior accessory then we recommend purchasing one from a third party retailer. It will be much cheaper.

In the end, it's up to you to decide which features are worth it. Everyone has their own preferences and this guide is simply meant to help you make your decision if you're on the fence about an upgrade. It's important to mention, though, that your budget – not your desire for luxury – should dictate how much you spend on your new car. If you can't afford a feature, then don't risk your financial stability by trying to get it.

SEE: Budgeting Basics

The Drive Train
The drive train or power train is the term applied to the system of components that makes a vehicle go. This includes the engine, the transmission and the powered axles. Since every new vehicle comes with several options for its drive train, it's important to consider how each of them will function before you make your decision. Here's an overview of the three major components of the drive train and the options you'll find available for them.

The Engine
The engine is a car's power plant. It's the biggest factor in determining how fast the vehicle will go and its overall fuel efficiency. Typically, engines are categorized by two statistics – the number of cylinders inside of the engine and the motor's overall displacement in liters.

Most engines use a configuration of four, six or eight cylinders. Smaller motors, like the 1.6 liter four-cylinder engines found in compact cars and small SUVs will enjoy the best fuel efficiency but suffer from a lack of power, making it a struggle to accelerate quickly, especially up steep hills. Conversely, larger engines like the 6.2 liter supercharged V8 in the Chevy Camaro ZL1 deliver massive amounts of torque but suffer from abominable fuel efficiency. To put the relationship between acceleration and fuel economy in rhyme – If you want to save dough, you're going to go slow. If you want to go fast, you're going to use a lot of gas.

Most vehicles will give you the option to choose from two or three different engine sizes. The difference between the options won't be as massive as you might think, but they will still be noticeable. For instance, upgrading the Ford Escape's 1.6L V4 to the 2.0L V4 isn't going to make the SUV into a racing vehicle, but the larger power will give the Escape a little more hitch in its giddy up – especially on steep inclines.

In some cases, experts actually recommend taking the upgrade because the smallest engine option is underpowered, as is the case with the Mercedes C250. In light of this, you should check reviews for every model you're considering to see how each engine option fares on the road before making your choice.

The Transmission
As far as the transmission is concerned, you'll have two options to choose from. Most new vehicles come with an automatic transmission that will engage the clutch and shift gears on its own. Many modern automatic transmissions also come with a "semi-automatic mode" where you can shift gears on your own using an automated clutch.

On the other hand, manual transmissions or "stick shifts" require you to engage the clutch and shift gears on your own. These transmissions are more difficult to operate but are considered to be more fun by some drivers. However, if you're looking for a manual transmission you'll likely have to buy a sports car or a stripped down budget-model sedan or compact.

The Powered Axles
If you've ever heard the term "front wheel drive" or "rear wheel drive," the speaker is referring to the specific axle in a vehicle that receives power from the engine. There are several different configurations of powered axles found on modern vehicles, and each makes a significant impact on the way the car drives. Here are the four primary types you'll encounter.

Front Wheel Drive (FWD)
In a front wheel drive configuration, the front two wheels of a vehicle receive power. Front wheel drive vehicles tend to have better traction than rear wheel drive vehicles, which makes them easier to handle in inclement weather. They also tend to enjoy a better fuel economy because the drive train weighs less. However, because the weight of the car moves back when accelerating, front wheel drive cars tend to be slower off the mark than vehicles with rear wheel drive.

Rear Wheel Drive (RWD)
Cars with rear wheel drive don't often handle as well at high speeds as cars with front wheel drive, but they accelerate much faster. Because of this many sports cars, like the Ford Mustang, use rear wheel drive instead of front wheel drive. For some cars, rear wheel drive is actually preferable because it can create a more even weight distribution, which improves the vehicle's handling instead of detracting from it.

Four Wheel Drive (4WD)
A four wheel drive configuration means that every wheel on a vehicle is receiving power from the engine. This system gives the vehicle much, much better traction on slippery surfaces like mud, dirt and snow. Expectedly, four wheel drive systems are most often found on "rugged" vehicles like pickup trucks, larger SUVs and some full-sized luxury sedans. There's a drawback to all the traction, though. Four wheel drive systems aren't as fuel efficient as two wheel drive systems and they can actually damage a vehicle's axles if they're used constantly on pavement. Because of this, most four wheel drive vehicles come with the option to switch to 2WD when you're driving on the road.

All Wheel Drive (AWD)
Some cars, such as Subarus, come with all wheel drive configurations. This means that every wheel receives constantly receive power when driving, like they do in four wheel drive configurations. Though these systems can't be turned off, they can be driven on pavement because they adjust the power ratio that each wheel receives to minimize the wear on components. However, the complexity of an all wheel drive system isn't always a good thing. Because the system is so sensitive, it isn't as capable as true four wheel drive configurations in extremely rough conditions.

SEE: 5 Reasons To Buy A New Car

A Note on Alternative Fuel Vehicles
While we're on the subject of drive trains, let's take a minute to talk about vehicles that use alternative fuels. Recently, many companies have begun to offer hybrid models of their most popular cars and SUVs. Several automakers also offer (almost) fully electric vehicles like the Chevrolet Volt and the Nissan Leaf. Additionally, diesel motors can still be found in larger pickup trucks and some European sedans. Though the drive trains in these vehicles can offer several advantages over standard gasoline engines, their true value is a topic of contention among auto experts. Here's what we think about them.

The Toyota Prius isn't the only hybrid on the roads these days. Many automakers have released hybrid editions of their flagship vehicles like the Ford Fusion and the Chevrolet Tahoe. The hybrid drive trains in these vehicles can boost their fuel efficiency to nearly 40 miles per gallon. However, you've got to pay to play with this kind of technology. Hybrid vehicles will likely cost at least $2,000 and as much as $10,000 more than their standard counterparts. At the current cost of fuel, it would take an average of seven years to see the economic benefits of purchasing a hybrid. If you plan on keeping your vehicle for longer than that, then a hybrid is a good decision. If not, consider sticking with a standard.

Electric Vehicles
Electric vehicles like the Chevrolet Volt are supposed to be the ultimate "green" cars. However, much of the technology they use is still nascent. At the moment, electric vehicles can only go about 50 miles on battery alone and roughly 200 miles with the help of their gasoline engine. That's not great, especially considering that the Chevy Volt costs $39,000. Additionally, these vehicles aren't exactly as green as they appear. The pollution caused by the industrial production of electric vehicle batteries often offsets the good these cars do for the environment. A recent British study financed by the Low Carbon Vehicle Partnership, found that an electric vehicle must be driven at least 80,000 miles before its positive impact offsets its negative. Though the technology may certainly be practical for the average auto owner in the next decade or so, we don't think it's there yet.

Diesel Vehicles
Diesel engines have long been an economic alternative to standard gas engines in large trucks like the F-350. The advantage of the diesel engine is that it provides the same amount of power as a large standard combustion engine but with much better gas mileage. However, the World Health Organization recently announced that diesel fumes are carcinogenic. As a result, we advise consumers to avoid purchasing a diesel engine. We're all for new technology, but as a consumer-oriented resource we feel that it's our responsibility to inform our readers of the limitations of alternative fuel vehicles. We're looking forward to the day that hybrid and electric technology becomes both affordable and reliable enough for the majority of American drivers, but it will be a few years before it even comes close. As such, we highly advise leaving the gasoline-driven power train in your new vehicle alone.

SEE: What Does It Mean To Be Green?

The Automaker
Which automaker is the best automaker? It all depends on the year. The quality of different vehicles is in a state of constant flux. While Ford might boast the best compact car one year, Toyota might win the award the next. In reality, the differences between automakers really come down to personal preference. Do you want a car that's fun to drive and well-designed or do you want a vehicle that's safe and reliable? In general, Japanese automakers, such as Toyota, Honda and Nissan tend to produce the safest and most reliable vehicles. Cars made by European companies like Audi, Volvo and Volkswagen tend to boast better performance and are more luxurious, but are also much more costly to maintain. American companies tend to make the best pickup trucks but have recently been improving their fleet of compacts and sedans, a la the Ford Fusion. The best way to figure out which brand you prefer is to hit the dealerships and start driving models. Fifteen minutes on the road can often tell you more about a car than week's worth of research, so find some free time in your schedule and start test driving different models.

Reliability should be one of your biggest concerns when purchasing a new vehicle. If your $15,000 car is prone to breakdowns, it could cost you more to own over a 10 year span than its $20,000 competitor. Even if most of these breakdowns are covered by the warranty, you can still be stuck for weeks without a vehicle while you wait for your new car to be repaired. The reliability of a vehicle varies by its make, trim line and model year, so it's important that you do your research to make sure that your new ride is a safe bet before you purchase it. Consumer Reports, Edmunds and Yahoo! Autos all have comprehensive reliability indexes that you can use for your research. In addition to a vehicle's reliability rating, there are a few other things that should factor into your final decision to buy. For instance, how close will you be to a certified repair center? Will the vehicle require parts to be ordered in, as is the case with many European models, or will there be parts in stock before you take the car in for maintenance? Though these factors don't hold as much weight as a car's overall reliability, they're definitely worth thinking about.

Safety technology has really evolved over the past years. We can confidently say that any new car you buy will be safe – to a degree. As always, some models of cars are still safer than others. If you transport children often, or have had a serious accident in the past, then you may want to invest in a car that specializes in keeping its driver and passengers safe and sound.

To determine how safe a vehicle is, you simply need to check its IIHS crash test rating. Each year, the Insurance Institute for Highway Safety subjects every model of production vehicles to rigorous collision tests. Each car, truck and SUV receives a rating based on its performance in front, side and rear collisions. Your vehicle should rate at least "Acceptable" and ideally "Good" on these tests. There are also a number of upgrades available for some vehicles that can help make them safer than the competition. Here are a few worth considering.

Curtain and Console Airbags
Every vehicle comes with dash-mounted airbags these days, but a number of models – such as the Buick Enclave – also have side curtain and center console airbags to lessen the blow of side-impact collisions. In general, the more airbags your vehicle has, the better.

Electronic Stability Control
Electronic Stability Control is a system that prevents a car from sliding sideways in a turn by controlling the vehicles acceleration based on wheel traction. With ESC equipped, a top-heavy vehicle is much less likely to roll over during a swerve. For top-heavy SUVs and minivans, this feature is indispensable.

Anti-Lock Brakes
Anti-lock brakes prevent your wheels from locking up and skidding during a sudden stop. While not a necessary feature - you can also prevent wheel lock by pumping the brakes – anti-lock brakes can be incredibly beneficial when driving over ice or large puddles.

Safety Alert Systems
Sometimes the best way to handle a collision is to avoid it in the first place. A number of luxury sedans have numerous electronic safety systems in place to help drivers avoid potential crashes. Motion detectors around the vehicle will alert the driver when an object is close and cameras in the rearview mirror will sound an alarm if you get distracted and take your eyes off the road.

A good IIHS rating and a myriad of safety features can help make your ride more secure, but the best way to stay safe in your vehicle is to practice defensive driving. Always check your blind spots before you change lanes, make sure to slow down when driving over puddles or ice and allow plenty of space between you and the car in front of you. Also, never, ever text and drive! A little caution will go a long way towards keeping you safe and accident-free.

The Warranty
Your new car isn't going to run perfectly forever. Eventually, you're going to experience some sort of mechanical breakdown – and that's when the quality of your factory warranty will really be tested. Good warranties will cover any and all maintenance costs on your new car for years after your first serious repair job. Bad warranties will probably run out about a year before you start experience car trouble. Consequently, the quality of a vehicle's factory warranty should factor heavily into your decision to buy. After all, there's nothing worse than shelling out $500 for a broken engine belt that you had nothing to do with. Here's a look at some of the most common types of warranties and the time periods you can expect them to remain valid.

Bumper to Bumper
A bumper to bumper or standard warranty covers every component in the car, from air conditioning to power windows to the engine and paint job. The best bumper to bumper warranties are valid for five years or 60,000 miles (whichever comes first). These are offered by Hyundai, Kia, Mitsubishi and recently, Volvo. . Besides these, bumper to bumper warranties will either be valid for three years/36,000 miles or four years/50,000 miles depending on the automaker.

Power Train
In addition to a bumper to bumper warranty, most automakers offer an extended warranty on the components contained in the Power or Drive Train. This applies to the engine, the transmission, and the axles – and in some cases the seats and seatbelts as well. Hyundai and Kia also win this category with a 10 year, 100,000 mile power train warranty for each brand.

Finally, your new car should also come with a perforation or rust-proof warranty. Essentially, this warranty will pay for new body panels in case your vehicle begins to rust. These warranties last for 3-5 years for unlimited miles.

In addition to your factory warranty, your dealership will offer their own extended warranty on your vehicle. Depending on which model of car you're buying, this may or may not be a good investment. If your new car is historically prone to breakdowns after five years, it may be worth your while to drop the money for the lengthened coverage. If you're warranty is already lengthy, though, there's no reason to throw your money away.

SEE: When Warranties Aren't Worth It

Cost of Ownership

Finally, the biggest thing to consider when purchasing a new car is that the sticker price is just the beginning of your new vehicle's total impact on your bank account. There are a number of additional expenses you'll encounter which, if unaccounted for, could end up putting you in a financial nosedive. Before you sign on the dotted line for your new ride, make sure you can handle all of these additional costs of ownership.

Insurance can be very affordable or very expensive, depending on what type of car you buy. Since you're getting a new vehicle, you should really invest in comprehensive insurance that covers both theft and collision. For standard compacts like the Toyota Corolla, this could be obtained for as little as $500 every six months. If you're buying a BMW or a Corvette, expect to pay several hundred dollars more per year.

SEE: Top Tips For Cheaper, Better Car Insurance

A car's fuel economy can mean the difference between spending $100 on gas every month and spending $1,000. If your new car has worse gas mileage than your current set of wheels, expect your monthly expenses to rise. If you live in a densely populated area, you can cut down on fuel costs by taking public transportation once in a while or arranging weekly carpools.

Maintenance and Repairs
Your warranty isn't going to last forever. If your car needs frequent maintenance to keep it running, you'll soon find yourself paying a steep price just to keep it on the road. Make sure that when your parts start to breakdown you have the money to cover the repair bill.

You also need to consider how much your car will depreciate over time when determining its cost of ownership. Some models hold their value better than others. If your particular car depreciates rapidly, you could end up losing a lot of money when it comes time to sell.

To get a good idea of what a new vehicle will really cost you, check out Edmunds' True Cost of Ownership Calculator. You just need to enter the make, model and year of vehicle you're interested in purchasing and the calculator will present you with

The Complete Guide To Buying A New Car: How To Negotiate Prices