To Her Credit offers targeted advice about personal finance based on unique challenges faced by women. It is authored by women with different financial backgrounds, dedicated to encouraging empowerment through financial literacy.
Buying a car is supposed to be exciting. Choosing a new ride, comparing your options, anticipating driving it – what could be better?
Unfortunately, too often this isn’t the case. Car shopping can be quite a stressful event, and especially for a woman.
It’s not uncommon for women to deal with salespeople trying to make as much money as they can, and car salespeople often act patronizing toward female customers, don’t take them seriously or outright assume they can be taken advantage of due to their presumed lack of car knowledge. All of this can make shopping for a vehicle a nightmarish experience for a woman.
But fret not: It’s possible to minimize the stress by taking the right steps. Read our step-by-step guide to buying a car and learn how to make it go smoothly and get the best deal.
8 steps to buying a car
Facing discrimination when buying a car
According to Road and Travel Magazine, women are buying more cars than men – in fact, women purchase 65% of new vehicles. Yet, many car salespeople seem to miss the point that a large number of their female customers are financial decision-makers.
Many women share their experiences of salespersons being pushy and treating them as if they don’t know anything; others say their male family members get very different treatment at car dealerships. For minority women, in particular, stereotyping by car salespeople as well as price markups and higher interest rates isn’t uncommon. This is an unfortunate reality for many minority groups in America as detailed in multiple U.S-based research studies (and even a 2002 class action lawsuit against Nissan Motor Acceptance Group).
Unfortunately, there are still many people who assume women are less knowledgeable about cars or don’t care about technical features. As we were gathering women’s stories for this guide, a prevalent assumption was that men care more about the features and performance of a vehicle, but women care more about the color and aesthetic appeal.
In fact, this is in direct opposition to car buying trends. A study on car preferences found that men are more likely to purchase stylish, luxury brands, while women are more drawn to affordable, safe and reliable vehicles.
Shannon Serpette, chief editor at Mom Loves Best, told us about a car buying experience that happened years ago but was so shocking it has stuck with her.
“I was single and in my mid-20s at the time and went to buy a car from my small-town, local dealership,” she said. “The salesperson seemed nice enough, I found a car I liked and I sat down with him to do the paperwork. When he started going over the terms of how much I would have to pay each month, he looked at me and said, ‘If you get knocked up, you know you still have to make your payments, right?'”
These days, Shannon is accompanied by her husband when she buys a car.
“The salesperson only seems to address him when he’s talking about the car or the financial end of it, even though I handle my family’s finances,” she shared. “It’s like I’m invisible. But, all in all, I’d rather have that than go through another lecture about pregnancy and financial responsibility.”
It can be infuriating to hear stories like this (let alone find yourself in one of them). Luckily, there are things you can do to prepare for buying a car, avoid unfair treatment and get a good deal.
Step 1: Figure out what you can afford
Before you start car shopping, you need to know how much you can spend. It’s generally recommended to stay under 10% to 15% of your take-home pay as far as monthly payments go.
That said, take your needs into account as well. Some people would rather spend less if it can still get them a reliable vehicle, while others may value comfort and modern technology enough to pay more for them.
It’s also essential to consider your overall debt. If a significant part of your income goes into paying off debt, an expensive car loan can put a strain on your budget.
Not to mention, your debt-to-income ratio can play a large part in lending decisions. Keep this in mind, especially if you’re planning to take out more debt in the next few years. For instance, mortgage lenders scrutinize your credit history and generally require that your debt-to-income ratio is under 43%. If you’re thinking of becoming a homeowner soon, make sure your car purchase doesn’t interfere with your plans.
Also, keep in mind that you may qualify for specific grants, donations or discounts depending on your situation. Single moms, for example, may be able to obtain help getting a car via nonprofit organizations like Cars for Moms, or families can apply for a grant (which can, in turn, be used toward transportation-related needs) through the U.S. government’s Temporary Assistance for Needy Families (TANF) program. If you’re an active-duty U.S. military member, on the other hand, you may qualify for military car loans or reduced interest rates.
See related: Is now the best time for women to buy a house?
Step 2: Check your credit
How much “car” you can afford depends not only on its price. Your credit score plays a significant role in what kind of deal you will get as well.
According to Experian data from 2018, those with credit scores between 501 and 600 on average financed $29,400 at 12.2% for 73 months and paid $12,400 in interest. Consumers with excellent credit scores (781-850), on the other hand, financed $31,700 on average at 4.2% for 63 months, only paying $3,700 in interest.
As you can see, a lower credit score can cost you thousands over the life of the loan. For that reason, improving your credit enough to get to the next credit tier can save you a lot of money.
Of course, building credit is a long-term commitment and results can take time. However, if you only need a few points for a higher credit tier, see if you can pay down your credit card to lower your credit utilization. Doing so can quickly increase your credit score, given that credit utilization accounts for 30% of it. Plus, improving your credit score can open the door to more credit opportunities in the future, such as approval for a gas credit card that earns you rewards on filling up your new car’s tank.
If you understand that your score won’t change much in the near future, consider how it can affect your approval odds and interest rate. Account for that when determining how much you can afford.
Step 3: Do your research
Now that you know the price point you’re comfortable with, it’s time for the exciting part – choosing your new car.
If you don’t have a specific make and model in mind yet, consider your needs and wants. Do you need a four-wheel-drive because you get outdoors a lot? Are you set on buying a hybrid? Do you want a compact car to easily navigate big city traffic? Or, maybe you’re looking for a reliable van for your kids and yourself. Find a few options that fit your desired parameters.
LeeAnn Shattuck owns The Car Chick, a car buying service for women, and has been helping women buy cars for nearly 20 years.
“Do your homework,” she says. “Buying a car is a process, not an event, and it starts with research. Research cars online to narrow down the list to your top three choices. Educate yourself on the models, options and pricing before you ever go to a dealership.”
LeeAnn suggests Edmunds.com as a great research tool. If you are on the market for used cars, you can also get a subscription to Consumer Reports to learn which models are reliable and which ones have had problems over the years.
Step 4: Sell your car – or plan your trade-in
If you sell your car directly, you’ll most certainly get the best deal. You can use websites like Craigslist to list your vehicle and connect with potential buyers.
That said, this process may take a while, as you’ll likely have to meet up with a few interested parties, allow them to test drive and negotiate. There are also safety concerns whenever you’re selling to a person rather than a dealership. Be on the lookout for fraud and avoid getting in the car with a potential buyer alone. Bring a friend or family member with you and meet in a public place to avoid risky situations.
If you want to avoid the hassle of selling your car directly, make sure to plan your trade-in. You can estimate your car’s value at Kelley Blue Book and list your car on the site to let dealers compete for your business.
An even quicker option is taking your car to the nearest CarMax for an appraisal before bringing it to the dealer. The offer you get at CarMax is the absolute minimum that your dealer will have to either match or beat. If you decide to trade it in at the dealership you’re buying from, don’t ignore this step. Dealers are infamous for offering as little as half of what your car is really worth.
Step 5: Find a salesperson you’re comfortable with
Now it’s time to hit a few dealerships. Choose at least three for them to compete for your business and call in advance to make an appointment.
Remember: You don’t have to work with a salesperson you’re not comfortable with. The minute you feel like you’re being patronized or not taken seriously, ask for a different salesperson.
Sturgeon Christie, CEO at Second Skin Audio, also recommends meeting with a female salesperson if it makes you feel more comfortable.
“You’ll want to call the dealership ahead of time anyway to schedule an appointment with them, and that’s a good time to ask if there’s a female salesperson you can work with,” she explains. “Each dealership typically has at least one or two women working in sales, so you can certainly ask to meet with a woman for your car buying appointment if that makes you feel more comfortable.”
Step 6: Bring a mechanic – and emotional support
If you’re buying a used car, make sure to bring a mechanic to your test-drive appointment with you.
According to Sean Pour, co-founder of a car buying service SellMax, taking the vehicle to a mechanic for a pre-purchase inspection is vital.
“A car might look good on the outside, but if you take a closer look, there could be rust or other underlying mechanical issues,” he says. “From experience, I know spending the extra $100 to $200 to have a car checked out before purchase is certainly worth it.”
On top of that, you can bring a friend or family member if you think that can make the car shopping experience easier for you. There’s nothing wrong with having some emotional support, especially if you feel like it will help you avoid unfair treatment. Quite a few women who have shared their car buying stories with us for this guide said they only go to car dealerships with their husbands. Given the treatment that women often get, it’s understandable.
At the same time, don’t be afraid to go it alone. Remember that you deserve to be treated with respect and get a fair deal whether you have someone by your side or not. Don’t let it be any other way.
Step 7: Negotiate
Avoid taking the first offer you get – you’ll likely lose thousands of dollars by doing this. It’s true that negotiating is rarely fun and often stressful, but the savings you get out of it are always worth it.
Dr. Deborah Gilboa, physician and sought-after speaker, said the experience of making such a major purchase with details and specifications that were unclear to her made her work against her best interests.
“It wasn’t clear that anyone was even taking advantage of me at the dealership,” she recounts. “I, in essence, was taking advantage of myself by focusing on the stress I was sure I’d feel and the ignorance I didn’t want to display. I decided before I even walked in the door that I’d just pay what they said it cost or walk away, but I wouldn’t push back on price.”
Fortunately, Gilboa realized she was having a stress reaction. She anticipated that she would feel distrust and discomfort, so she planned how to minimize those feelings instead of managing them.
“I had to ask myself, was I willing to pay thousands of dollars, in the long run, to avoid feeling discomfort in the short term?” she says. “I was not.”
Here are a few tips Gilboa shared with us that can help you eliminate the stress of negotiations:
- Speak out loud about the long-term benefit of the short-term discomfort. (“I can save thousands of dollars!”)
- Remember other times that you have outlasted feeling uncomfortable.
- Use strategies that have worked in the past for managing discomfort, such as listening to the music you like or seeking a friend’s support. Bring that strategy with you into the car buying experience.
Step 8: Be prepared to walk away
Unfortunately, sometimes the dealer won’t budge, and the price doesn’t get near the amount you’d agree to pay. It can be discouraging, especially knowing that you can drive off in the car you want if you just accept the terms you’re offered.
Try to resist the temptation. A car loan is a long-term financial commitment – avoid taking it lightly and making any rash decisions.
If you walk away, chances are the dealer will come up with a better offer for you. If they can’t, you can rest assured you got a fair price – but it still doesn’t fit in your budget. In that case, check other dealerships. If it doesn’t help, expand your search to older models or include more options.
Many experiences in today’s world are different for women, and car buying is just one example. When a woman goes to an auto dealership, she may face patronizing behavior and salespeople who don’t take her seriously because they think she’s not technically inclined.
Whether you’re a car aficionado or know nothing about cars, you deserve to be treated with respect and get a fair price. Arm yourself with research, let dealers compete for your business and never agree to a deal that doesn’t work for you. It can be quite a process – but getting what you need on the terms that you want is worth it.