I need to buy a car when I graduate from high school. I want something reliable that I can take up to college. How do I go about finding and purchasing a vehicle?  Buying a car can be both exciting and stressful but you can reduce the stress level involved if you do a bit of research and get smart about your purchase.

The first thing that you should do is find out how much car you can afford. Analyze your budget and see where you can cut costs to make money available. If you do not have a budget yet, now is a good time to make one. For free instructions on how to design a budget that fits your needs, visit www.dmcccorp.org and click on Educational Materials. Once you see how much money you have available for a monthly payment, calculate how much money you have to use as a down payment. If you have a vehicle that you would like to trade in, find out how much you can expect to get for it. Visit the Kelly Blue Book website, www.kbb.com, to find out the value of your trade-in.

After you know how much money you have for your new vehicle, you should get an idea of what kind of financing rate you can expect to get. First, order your credit score from www.annualcreditreport.com. Your credit score is one of the items that lenders will look at to qualify you for a loan. The higher your credit score, the better the rate you will get. Do some research about  what kinds of loans are offered for the vehicle you want and the credit score you have. Do your homework before you go to a dealership, that way if they offer you a rate that is much higher than what you know you can get, you can choose to do your financing elsewhere.

Once you know how high of a monthly payment you can afford, what you want your down payment to be, what your trade-in value is, and what interest rate you can expect to get on a car loan, you can figure out how much you can afford to pay for a car. Go to www.bankrate.com and click on their auto loans section. Go to calculators and click on How much car can you afford? Follow the instructions to find out what is your maximum affordable sticker price. This number is the maximum amount that your new car can cost. Now you are ready to shop.

Based on the number you got using the BankRate calculator, you should now have a basic idea of what cars you can afford. Select three or four models that you like and fit your budget. Do not base your decision solely on looks. Think about safety, gas mileage, features, resale value, warranty, and cost of insurance. Foreign cars usually cost more to insure than American-made cars. Also, the younger you are, the higher your insurance bill will be. Even the model year of the car can make a difference in how much you will pay for insurance. Older cars usually have lower insurance costs. However, new safety features such as airbags and anti-lock brakes can also lower the cost of insurance. Call your insurance company before you buy the car and find out how much it would cost to insure it. Is this still within your budget?

Test-drive the cars that are within your specifications and get a quote from a dealer. If you do not have the money to purchase a new car, try finding a late model car with a good bumper-to-bumper warranty. Once you decide what car to get, stick to your guns and do not let a car dealer take you for more money than you want to pay. Their job is to make the most money possible out of the deal. Your job is to get the best deal for the car that you want. Be patient and courteous, but firm. Always be ready to walk away and look at other options. Many times, when a dealer sees that you are ready to walk out on them, they will offer you a better deal. Good luck and happy car shopping.

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.