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Buying Your First Car

Buying Your First Car

Buying a car is exciting, potentially stressful, and often expensive.  In fact, for many people, buying a car is the third most expensive type of transaction they have – after a house and an education.  To make the process easier, consider that there are three parts of the process – choosing the car you want, negotiating the purchase, and paying for the car.  Remember that an automobile is not an investment; it is just a means of getting from one place to another.

Choosing the car you want and can afford
Whether you decide to buy a new or a used car, be sure to do your homework.  Along with considering the creature comforts of the car and whether you like it, you should also investigate the reliability of the car and the costs to drive it.  Be sure to take every car you are considering for a test drive.

You can learn about the costs of operating the car and reliability by examining the gas mileage information on the sticker and visiting websites that review cars.  Use the Internet to search for sites that provide this type of information.  Also, speak with an insurance agent to learn what your insurance premiums will be.  When you take everything into account – car payments, maintenance, parking, gas and insurance – you may want to consider limiting the total auto expense to 10% to 15% of your monthly income.

The new or used decision
This is usually a matter of your preference and what you can afford.  New cars are nice and usually come with a warranty that covers unforeseen expenses, but they are more expensive.  If you are considering a used car, be sure to do some extra homework on the particular car you are considering.  Have a qualified mechanic inspect the car and you may want to get a Vehicle History Report (websites like www.Carfax.com offer these reports) to learn if the car was ever stolen, salvaged or recalled.  The report will also provide information on the number of previous owners, whether it ever failed an inspection or if someone tried to modify the odometer.

Negotiating the purchase
This is most stressful part.  You will be spending a considerable amount of money and car sales people are notorious for their aggressive sales techniques.  Always remember that you are the customer and that there are many car dealerships that would love to have your business.

Do your homework and be prepared before you walk into an auto showroom.  If you are just looking and not prepared to buy a car when you walk in, emphasize that to the sales person.  When you are ready to buy, you should come with facts, and there is no better place to get those facts than the Internet.  Several websites, including Autobytel and CarsDirect*, will let you get price quotes beforehand.  Do not be afraid to take printed copies of competitive pricing and show them to the sales person. 

Stay focused on the purchase price of the car you want.  Keep discussions about any trade-in separate and any discussion on financing out of the negotiation.  Be careful to not be talked into dealer add-ons like rust-proofing, extended warranties or other options unless you really want them.  These add-ons are very profitable for the dealer and can be very expensive to you.  Do not hesitate to walk out and go to another dealer if you cannot get the price you want or if you are not treated with respect.

Paying for the car
You can pay cash.  While most people do not pay cash, you may want to do this if you have excess funds available.  It is simple and you will avoid any interest expenses.

You can make a down payment and finance the rest.  This is most common.  There are many places to get an auto loan, including at MutualBank and the dealer.  We offer a variety of terms.  Check out our Education Center Calculators. They can help you determine what your monthly payments would be at different size loans and different interest rates.

Unless you are planning to use financing from the dealer, secure financing before you walk into the showroom.  That will be one less thing to distract you and will help you stay within your budget.

Another popular way people pay for cars is by leasing them.  This avoids the need for a large down payment and at the end of the lease, you just return the car.  But, you never own the car.  Leasing may be attractive if you plan to only keep the car for three to four years or if you plan to drive a great deal and can get a lease without a mileage limit.

Whether you are getting a loan or using a lease, be sure to fully understand all the details before you sign any documents.

Final words
You can make getting the car you want (and can afford) easier by doing your homework and avoiding letting your emotions come into play.  Negotiating the purchase is usually adversarial, but being prepared and being willing to take your business elsewhere can let you stay in control of the process.

 

 

*Web sites listed for information only. No endorsement is implied.

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  • Mutualfirst Financial, Inc. Announces Agreement With Major Stockholder 

    Muncie, Indiana - February 27, 2015 – MutualFirst...

    Monday, March 2, 2015

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Mutual Blog

Proactive Steps to Take in Light of Anthem Data Breach

Chances are you are a person who has Anthem insurance coverage or you know someone who does. As a result, either you or your friend has a reason to be concerned.

A typical data breach includes a compromise of debit card numbers or partial personal identifying information. This kind of breach, though inconvenient, can typically be ‘fixed’. An initial investigation indicates that the Anthem breach includes a compromise of name, birthday and/or social security number. This kind of information is all one needs to steal someone’s identity.

According to Anthem this particular breach could affect up to 80 million people. Instead of trying to ignore this has happened or just being upset, it’s now time for you to be educated and try to protect yourself as best as you can. We have some tips that will help you accomplish that.


1. Review Your Statements


First, take a moment each month to view your eStatement or monthly statement. You can monitor your accounts throughout the month with Online Banking and the MutualBank App. Monitoring your accounts will give you the quickest opportunity to see if your accounts have been compromised. If you notice any transactions that are unfamiliar or questionable, please get in touch with your MutualBanker. Call us at 800-382-8031.


2. Be Cautious with Any Anthem Emails You Receive


Next, if you receive an email stating it is from Anthem, be cautious. Anthem’s website warns customers not to reply with information, click any links or open any attachments within the email. Anthem is not calling their customers and will not ask for information. Never give your credit card information, social security number, or other sensitive information to someone via email or over the phone.


3. Consider Freezing Your Credit


If you are a resident in Indiana, the Attorney General’s office website (http://www.in.gov/attorneygeneral/2853.htm) is offering and encouraging you to sign up for a free credit freeze with each of the three credit bureaus. A credit freeze places a hold on your credit where a new line of credit could not be obtained without you unfreezing your credit. This doesn’t affect already open credit lines like an existing credit card, yet helps to protect you against someone opening new lines of credit in your name.


4. Keep in the Know


Finally, try to keep in the loop on the Anthem Breach. The best source for current information about this breach can be found at Anthem’s Frequently Asked Questions. (http://www.anthemfacts.com/faq)

MutualBank is here to help inform you of ways to help protect against identity theft. Thank you for trusting us.

Sunday, February 15, 2015

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Buying Your First Car

Buying Your First Car

Buying a car is exciting, potentially stressful, and often expensive.  In fact, for many people, buying a car is the third most expensive type of transaction they have – after a house and an education.  To make the process easier, consider that there are three parts of the process – choosing the car you want, negotiating the purchase, and paying for the car.  Remember that an automobile is not an investment; it is just a means of getting from one place to another.

Choosing the car you want and can afford
Whether you decide to buy a new or a used car, be sure to do your homework.  Along with considering the creature comforts of the car and whether you like it, you should also investigate the reliability of the car and the costs to drive it.  Be sure to take every car you are considering for a test drive.

You can learn about the costs of operating the car and reliability by examining the gas mileage information on the sticker and visiting websites that review cars.  Use the Internet to search for sites that provide this type of information.  Also, speak with an insurance agent to learn what your insurance premiums will be.  When you take everything into account – car payments, maintenance, parking, gas and insurance – you may want to consider limiting the total auto expense to 10% to 15% of your monthly income.

The new or used decision
This is usually a matter of your preference and what you can afford.  New cars are nice and usually come with a warranty that covers unforeseen expenses, but they are more expensive.  If you are considering a used car, be sure to do some extra homework on the particular car you are considering.  Have a qualified mechanic inspect the car and you may want to get a Vehicle History Report (websites like www.Carfax.com offer these reports) to learn if the car was ever stolen, salvaged or recalled.  The report will also provide information on the number of previous owners, whether it ever failed an inspection or if someone tried to modify the odometer.

Negotiating the purchase
This is most stressful part.  You will be spending a considerable amount of money and car sales people are notorious for their aggressive sales techniques.  Always remember that you are the customer and that there are many car dealerships that would love to have your business.

Do your homework and be prepared before you walk into an auto showroom.  If you are just looking and not prepared to buy a car when you walk in, emphasize that to the sales person.  When you are ready to buy, you should come with facts, and there is no better place to get those facts than the Internet.  Several websites, including Autobytel and CarsDirect*, will let you get price quotes beforehand.  Do not be afraid to take printed copies of competitive pricing and show them to the sales person. 

Stay focused on the purchase price of the car you want.  Keep discussions about any trade-in separate and any discussion on financing out of the negotiation.  Be careful to not be talked into dealer add-ons like rust-proofing, extended warranties or other options unless you really want them.  These add-ons are very profitable for the dealer and can be very expensive to you.  Do not hesitate to walk out and go to another dealer if you cannot get the price you want or if you are not treated with respect.

Paying for the car
You can pay cash.  While most people do not pay cash, you may want to do this if you have excess funds available.  It is simple and you will avoid any interest expenses.

You can make a down payment and finance the rest.  This is most common.  There are many places to get an auto loan, including at MutualBank and the dealer.  We offer a variety of terms.  Check out our Education Center Calculators. They can help you determine what your monthly payments would be at different size loans and different interest rates.

Unless you are planning to use financing from the dealer, secure financing before you walk into the showroom.  That will be one less thing to distract you and will help you stay within your budget.

Another popular way people pay for cars is by leasing them.  This avoids the need for a large down payment and at the end of the lease, you just return the car.  But, you never own the car.  Leasing may be attractive if you plan to only keep the car for three to four years or if you plan to drive a great deal and can get a lease without a mileage limit.

Whether you are getting a loan or using a lease, be sure to fully understand all the details before you sign any documents.

Final words
You can make getting the car you want (and can afford) easier by doing your homework and avoiding letting your emotions come into play.  Negotiating the purchase is usually adversarial, but being prepared and being willing to take your business elsewhere can let you stay in control of the process.

 

 

*Web sites listed for information only. No endorsement is implied.

Contact a Representative Today

Back to Education Resources

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