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Dollar Signs
Aired September 20, 2003 - 16:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: And now welcome to "Dollar Signs." We're going to talk about something that just about every motorist in the U.S. has to deal with at one time or another. We're talking about buying a new car. Our financial correspondent Ali Velshi says if you want to get the best buy for your buck check your emotions at the door.
(BEGIN VIDEOTAPE)
ALI VELSHI, CNN FINANCIAL CORRESPONDENT (voice-over): So it's time to buy a new car. Today's car buyer is armed with more tools than ever before. There are pricing books, Web sites, even car buying services, all of them designed to get you a new ride without being taken for a ride. But even if you already have your dream car picked out this car dealer says it's not as simple as heading down to the lot and cutting a check.
JOHN BRUNO, CAR DEALER: If I had to give any consumer any advice I would say do your homework.
VELSHI: With Web sites like consumerreports.org, caranddriver.com, and edmunds.com offering not only reviews of the latest models but also what the dealers originally paid the manufacturer for the car it's now easier than ever to match your dream car to your dream price and those same manufacturers may be driving your dream price lower than ever before.
BRUNO: The manufacturers want to make sure that from a retail standpoint you're moving vehicles and they help dealers a lot. They help the retailers, like myself, a lot, you know, by offering incentives, finance rates.
VELSHI: In fact there are deals available beyond those that the dealer may offer you. So how do you get the best deal? Edmunds.com editor Phil Reed offers some suggestions. First and foremost avoid the showroom floor.
PHIL REED, EDMUNDS.COM: Don't just walk onto the car lot because you have no control over who you're going to be dealing with. You may get a salesman who's very aggressive or who you don't like, so it's a good idea to shop on the phone first, set up an appointment and then go in and buy.
VELSHI: Second, Reed says, once you've settled on a car get at least three quotes from different dealerships giving you the bargaining power to call your salesperson and say... REED: You know the lowest price I've got is this. If you can beat it you've got my business.
VELSHI: And, third, be realistic about your finances. Don't let the temptation of low rates and easy financing make you spend more than you should.
REED: Generally, experts advise that you spend only 20 percent of your total income on your car payment.
VELSHI: Reed says follow these tips and, this is easier said than done for some car buyers, keep your distance and never fall in love with a particular car. You should be able to get a pretty good deal.
For DOLLAR SIGNS, I'm Ali Velshi, CNN Financial News, New York.
(END VIDEOTAPE)
LIN: Now, in addition to those best price quotes from the dealers there are some other things to consider like insurance rates and resale value. Automotive expert Lauren Fix, the co-host of "Talk to DIY Automotive" is joining us from Buffalo, New York with some tips on what to look for. Hi, Lauren, good to see you.
LAUREN FIX, AUTOMOTIVE EXPERT: Good to see you. Good morning.
LIN: Hey, I want to pick up on a point from the piece. Is it -- would you agree with that premise, avoid the showroom floor because when I go shopping I want to see the product?
FIX: Well, you want to see the product and you want to drive the product and everyone's afraid of getting that aggressive salesperson or maybe a new or someone who's been there so long that they don't give you the details that you're looking for.
So, you want to come armed with the questions before you get there. What are your needs? So, when you have all the questions down you know you're looking for a certain make and model, you can walk in there, go to the showroom floor and say I want to go for a test drive.
Some dealerships, depending upon where you are and if they know you they might ask you to leave the keys to your vehicle or your driver's license and you can take it for a test drive with your family and that's always a nice thing to do because you don't want the pressure of a salesperson there, which is what they were saying at Edmunds. They don't want that pressure of someone saying you got to buy this car. This is the right car for you.
LIN: And you're a woman, I mean I have to ask that because I'm a woman and if I go shopping I'm going to feel like I'm getting taken advantage of so should I take someone with me?
FIX: Well, I don't know. I think it depends on the person and your personality. I don't usually have that problem because I walk in there knowing what I want in advance. And, nowadays the dealers have been trained, and I used to do dealer training, to expect women to come in more educated, so the more you know is more valuable to you. Whether you go out and get on the Internet and you get all that information or you buy a bunch of magazines that are available the more armed you are.
When you walk in they're going to know you know what you want to talk about and what you're looking at. They know you don't want to look at that lit vanity mirror and that other things are more important to you.
LIN: Right, right. Now how do you know? Can you know ahead of time if you're going to get a lemon?
FIX: Well, there's a lot of things. If you're buying a used car off a used lot that's different because you don't know or from a private owner. If you're buying a new car and you get a lemon that's really unusual and rare but that's why that protection is there and the government has put that in place for that reason.
If you're buying a new model you should expect they may have a few glitches and the manufacturers do try to sort that out before they go out to the market and start marketing a new vehicle. So, if it's a new model that's never been out before it's possible there might be a few things.
I've had a few issues that way but they're not lemons. They're usually corrected quite quickly by the dealership and they always want to make you happy. These days they've been trained to expect that things happen. Used cars are a different story, however.
LIN: Right, all right.
FIX: (Unintelligible) lemon out there.
LIN: All right let's talk about used cars in a minute but let's focus on new right now.
FIX: OK.
LIN: You say take advantage of rebates. Are there a lot of rebates out there right now?
FIX: There are a lot of rebates out there right now. There's a lot of cars in the lot left in the 2003 model year. Now is the time to pick up a 2003 if you're looking at a new car versus maybe buying an '04.
There are rebates and there are incentives but, remember one quick tip. Just because there's rebates and incentives and low financing that doesn't mean you can't barter, so make sure to barter in addition.
Now, a lot of time people feel uncomfortable. Well, they're already giving me back this money. No, that money is coming back from the manufacturer. It's not coming back from the dealer so the dealer still has room to move because they still get hold back, which is money that's given to them for selling that car through that dealership.
So, keep in mind that if you go into a dealership and you ask for a certain car and the guy says well there's a great rebate or the gal says a great rebate and financing you should be happy with the price we offer you. There's still room to move.
If that manufacturer or that dealer won't move go to a different dealer. Again, get three prices, just like you said earlier and balance them off and the one who can give you the best price or the best service to go along with that will be the car to buy.
LIN: All right. This was really interesting, best new car values. In taking a look at this we see the Lexus GS 300 in the luxury sedan category, sports car would be the Acura RSX Type S, midsize SUV, Honda Pilot, are these justified do you think? Are they going to hold their value if you want to resell?
FIX: They do hold their value and if you're looking for a used vehicle you can usually get a good deal by getting a car that's one or two years old that maybe someone traded in off a lease or maybe they want to upgrade to a different vehicle. They are good vehicles and a lot of domestic manufacturers have good products too.
If you're looking at trucks, Ford and GM and Dodge always make great trucks, so you want to look on the Web site before you go and buy a used vehicle to find out. There's lots of message boards and things that are going on and at "Talk to DIY" we get a lot of questions for automotive about different things that people have problems with.
So, it's your responsibility to be car care aware before you buy a used vehicle or when you're looking at maybe one or two years old. Get on the Internet to start searching magazines to find out which vehicles are having more maintenance problems than others.
Sometimes it's not the car. Maybe it's just like an automatic transmission has less problems than a manual transmission on the specific applications so check that out.
LIN: Now, is there an age of a car like two years, three years out, where you figure most of the losses have been a washout, you know, and from that point on your used car can hold its value?
FIX: Usually after three years if you've purchased a car after three years is a good opportunity to sell it. If you buy a car and sell a car every year you're really not getting your best investment.
To get the most out of your money you really need to keep that car three years. Now, again, once that car is three years old or if you put a lot of mileage on it once it gets over 50,000 miles don't forget to maintain that vehicle so you can get the most for your money.
People forget about that. Again, being car care aware is part of taking care of the maintenance on that vehicle so it will last 200,000 miles and, believe it or not, they do these days. Nissan Pathfinders, I've got a friend who's got on with 300,000 miles on it.
LIN: Oh, my.
FIX: And still running strong.
LIN: I want to know her mechanic. Okay, stay right there Lauren. Your calls and e-mails are next on DOLLAR SIGNS. You can still send your question to dollarsigns@cnn.com or call in. That number is 1-800-807-2620. We're going to be right back.
(COMMERCIAL BREAK)
LIN: Welcome back to DOLLAR SIGNS. We're talking about buying cars and how to get the best deal. Automotive expert Lauren Fix is with us in Buffalo, New York, to answer your questions.
Hey, Lauren we've got a call from Susan in Ohio -- Susan.
SUSAN: Hi.
FIX: Hi, Susan.
SUSAN: I have to talk fast because my phone battery is dying.
LIN: OK, go ahead.
SUSAN: I am in the process where I'm ready to buy a car but I'm really dreading the pressure and the politics that are involved so I'm wondering what the best resources are for buying my new car in terms of negotiating and preparing myself and my confidence. And, also, I'm wondering about any dot coms. Once in a while I see those on people's license plates.
LIN: OK, Susan, so Lauren where should she go?
FIX: Well, so far as the Internet there are some great sources. One of the ones you can use is edmunds.com. That's E-D-M-U-N-D-S.com. They are probably one of the most comprehensive sites out there that I like to use because when you're looking for a car, whatever year, make, and model that might be, there's also four comparisons there in the same market that you may have not considered because some people say well I'm looking at a Toyota and I'm sticking with that.
But then maybe you didn't think of that Hyundai or that Honda that's in the same category, so make sure that you check them out because it might meet your needs and the price might be in your market.
Now, another important thing to check out when you're going to the dealership you want to get all that comparison information off the Internet or you can go to stores if you don't have access to the Internet and get "Consumer Reports" has a bunch of magazines out.
So, get everything that you need on information on your vehicle. Then call your insurance company. Find out what year, make and model you have. Tell them I'm looking at this. The first thing they're going to ask you is does it have airbags? Does it have antilock brakes?
All those things can help reduce your insurance payments. Keep in mind if you're looking at a Honda versus a Hyundai the Hyundai, believe it or not, may cost less but may cost you more in insurance so that's something you want to look at because that's going to be a factor that's going to add into your total cost.
And, of course, maintenance numbers are also available on the Internet, places like Edmunds and Kelly Blue Book are all out there. Kelly Blue Book is kbb.com and those will all help guide you in the right direction.
LIN: All right, thanks Lauren. We've got an e-mail from Raj who's on a budget and he writes to us saying: "I am deciding whether to buy a new car or a used car. I have a budget of around $12,000 to $15,000. Any suggestions?
FIX: Well, I think it depends how important safety is to you and, hopefully, it is very important because when you're looking at airbags you want to go with the most advanced airbags and antilock brake packages and, of course, those are going to be in the more expensive vehicles.
So, when you have about $12,000 to spend there really aren't very many vehicles that are going to fit into that if you're planning on purchasing that car. Now, if you want to have payments and you want to lease a vehicle you don't want to put that much down either. So, if you do have $12,000 to spend a few thousand dollars down makes a lot more sense than putting a lot of money down on a lease.
Now, if you've just got $12,000 in your budget and that's it, look for a vehicle that's about two or three years old. Some of the things you want to do is when you look at that vehicle make sure to take it to a certified technician before you make the purchase whether that's at a used car lot.
Go to your favorite technician. Have them look at these things because even a private seller, they say oh, yes, I had everything taken care of. Ask the questions first. Did you have any major maintenance done on this vehicle and if they say, yes, I had the motor replaced and the brakes, then it's important to say do you have receipts for that?
If you don't have receipts for that and you need to ask in that order then you have a problem with proving that this maintenance has been done properly. So, you want to make sure that you check out all the details of these vehicles, look at the brake pedals and see if they're worn.
Pop the hood and look to see if there's any greasy, grimy areas that maybe are caked up more than the other. Drive the vehicle to see if it rides funny, if the steering is bumpy. All those little details will help you buy a good used vehicle. Now if you buy it off a used car lot most states have a box that will say as is or there's a warranty involved. You want to make sure you get a warranty that's involved. As is means you bought it. You're going to be responsible for making those repairs and that's when you'll be calling to talk to DIY and Steve Ford and I will be answering your questions but you don't want to be in that situation.
LIN: Right. Boy, Lauren, I think you answered ten e-mails in one, all right. We've got Beverly in Louisiana on the telephone. Beverly, what's your question?
BEVERLY: Hi. I'm in the business of fixing to buy a new truck and I was wondering how low should I expect them to come down on the price. I'm paying cash.
FIX: Well, you can get them to come down on the price on trucks. If you're looking at a 2003 -- are you looking at a 2003 or '04 Beverly?
BEVERLY: If I can get a 2003, I'll go with that.
FIX: Yes, you'll probably get a better deal on an '03 and the real secret is buy at the end of the month that last week of the month because usually contests and all kinds of incentives for the sales people. So walk in there that last week of the month and you will get your best deal.
Also, if they say, oh, we've got incentives and great financing, Beverly, you're all set, still ask for a lower price because they've got to get rid of those '03s because they need room on their parking lot for the 2004s that are coming in so now is a great time to buy a new vehicle.
LIN: All right, Lauren we've got an e-mail from Nelson. He writes: "I am considering buying a 2004 Toyota Prius. I am not sure hybrid cars have any resale potential after you've owned them. Is it a folly to buy such a car from the financial perspective"? Now, the hybrid cars are, what, half gasoline, half electric?
FIX: Right and it depends on the vehicle and the manufacturer. Buying a new Prius is actually a really nice vehicle. I was at the product launching. We got to drive them. Surprisingly, they do have the power and so forth and they do have resale.
There are people that are extremely concerned about the environment and those vehicles do have resale down the road and, believe it or not, you will get unbelievable gas mileage. Some are claiming higher than 60 miles to the gallon so you're going to save money up front.
And, of course, the insurance will be less on that too but you might want to check on each and make and model on those environmentally friendly cars because some of them do have higher insurance rates.
So keep that in mind before you go out and buy this Prius, although it is a good vehicle. The resale on it should be good down the road as more and more vehicles are becoming more environmentally friendly.
LIN: All right.
Lauren stay right there because more of your calls and e-mails, we're going to be taking them right after the break. Be right back.
(COMMERCIAL BREAK)
LIN: Welcome back to DOLLAR SIGNS.
We're trying to take the anxiety and worry out of buying your next car. Automotive expert Lauren Fix is with us to answer your questions. Lauren, we've got an e-mail from Srinivas. I hope I'm pronouncing the name correctly.
Srinivas writes: "For a family of four could you give me a recommendation, a midsize sedan or an SUV, considering safety and room, also, a specific model, if possible?"
FIX: Well, I guess it depends what you have, how many children you have and how much cargo you carry. If you're like my kids you got everything from karate to dancing gear and I needed a big vehicle myself so I ended up going with a sport utility vehicle.
But, if it's just, you know, kids and they're little and you're just, you know, they're still kind of going to school and they don't have all those extracurricular activities there's lots of midsize -- I hate to pick a specific year, make and model and brand but there's a lot of great applications out there.
I happen to like the Nissan Ultima. It depends what you're looking for. The Nissan Pathfinder is great. Everybody makes great vehicles. Ford has some great vehicles, General Motors does, even Hyundai and Kia have put out some really great vehicles.
I think your best bet is decide how much gear you have to carry on a regular basis. Are you the mom taxi or the dad taxicab driver where you're hauling all that stuff with you and how many children you're carrying?
If you've got four or five children you're going to be forced into a minivan. If you've got just two children then it's a different situation. I happen to be a truck person too, so I guess it depends what your needs are. If you're hauling a boat then you're going to need to have a truck.
If your needs are traveling a lot, you do a lot of family vacations and maybe you've got to bring the baby carriage and the little playpen and all the baby stuff, then you're going to need a minivan or something with a large trunk.
So, make sure you check that out. Honda makes some great vehicles. The new Odyssey is great. The Toyota Sienna is an excellent minivan. They key thing is check for crash test ratings. Your most precious cargo is your children and so you want to go to a place like National Highway Traffic Safety Association, which is nhtsa.gov. It has all the crash test ratings.
Get the most safety you can and as far as safety in sedans versus minivans, minivans many of them have rollover protection and side airbags. Remember, side airbags do not blow out at you just like a front airbag does.
It actually comes down. It's a curtain that protects your head and torso from a side impact so those are things you want to look at, antilock brakes, and remember when you add all these safety items up it also reduces your insurance. So, these are some of the things you want to look at crash control, all those things make a difference, keep the vehicle more safe.
And, another thing is if you're buying a used vehicle and maybe you don't want to buy that new vehicle and you want to find a technician and you just can't find one in your area or you're new to an area, there's a Web site called carcare.org and they actually will help you find a technician in your area that's certified so that you're getting a good deal.
LIN: All right. Thanks so much, Lauren.
FIX: Thank you.
LIN: Lauren Fix, great advice today.
FIX: Thank you.
LIN: Well, CNN has it all this afternoon. America's favorite sitcom "Friends" is profiled next on "PEOPLE IN THE NEWS."
And then at 6:00 Eastern on CNN LIVE SATURDAY, should oversight of the stock market be split in two? We're going to look at the pros and cons.
Then at 7:00 Eastern mix it up with "THE CAPITAL GANG" for some of the toughest talk on television.
Thanks so much for joining us.
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Aired September 20, 2003 - 16:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: And now welcome to "Dollar Signs." We're going to talk about something that just about every motorist in the U.S. has to deal with at one time or another. We're talking about buying a new car. Our financial correspondent Ali Velshi says if you want to get the best buy for your buck check your emotions at the door.
(BEGIN VIDEOTAPE)
ALI VELSHI, CNN FINANCIAL CORRESPONDENT (voice-over): So it's time to buy a new car. Today's car buyer is armed with more tools than ever before. There are pricing books, Web sites, even car buying services, all of them designed to get you a new ride without being taken for a ride. But even if you already have your dream car picked out this car dealer says it's not as simple as heading down to the lot and cutting a check.
JOHN BRUNO, CAR DEALER: If I had to give any consumer any advice I would say do your homework.
VELSHI: With Web sites like consumerreports.org, caranddriver.com, and edmunds.com offering not only reviews of the latest models but also what the dealers originally paid the manufacturer for the car it's now easier than ever to match your dream car to your dream price and those same manufacturers may be driving your dream price lower than ever before.
BRUNO: The manufacturers want to make sure that from a retail standpoint you're moving vehicles and they help dealers a lot. They help the retailers, like myself, a lot, you know, by offering incentives, finance rates.
VELSHI: In fact there are deals available beyond those that the dealer may offer you. So how do you get the best deal? Edmunds.com editor Phil Reed offers some suggestions. First and foremost avoid the showroom floor.
PHIL REED, EDMUNDS.COM: Don't just walk onto the car lot because you have no control over who you're going to be dealing with. You may get a salesman who's very aggressive or who you don't like, so it's a good idea to shop on the phone first, set up an appointment and then go in and buy.
VELSHI: Second, Reed says, once you've settled on a car get at least three quotes from different dealerships giving you the bargaining power to call your salesperson and say... REED: You know the lowest price I've got is this. If you can beat it you've got my business.
VELSHI: And, third, be realistic about your finances. Don't let the temptation of low rates and easy financing make you spend more than you should.
REED: Generally, experts advise that you spend only 20 percent of your total income on your car payment.
VELSHI: Reed says follow these tips and, this is easier said than done for some car buyers, keep your distance and never fall in love with a particular car. You should be able to get a pretty good deal.
For DOLLAR SIGNS, I'm Ali Velshi, CNN Financial News, New York.
(END VIDEOTAPE)
LIN: Now, in addition to those best price quotes from the dealers there are some other things to consider like insurance rates and resale value. Automotive expert Lauren Fix, the co-host of "Talk to DIY Automotive" is joining us from Buffalo, New York with some tips on what to look for. Hi, Lauren, good to see you.
LAUREN FIX, AUTOMOTIVE EXPERT: Good to see you. Good morning.
LIN: Hey, I want to pick up on a point from the piece. Is it -- would you agree with that premise, avoid the showroom floor because when I go shopping I want to see the product?
FIX: Well, you want to see the product and you want to drive the product and everyone's afraid of getting that aggressive salesperson or maybe a new or someone who's been there so long that they don't give you the details that you're looking for.
So, you want to come armed with the questions before you get there. What are your needs? So, when you have all the questions down you know you're looking for a certain make and model, you can walk in there, go to the showroom floor and say I want to go for a test drive.
Some dealerships, depending upon where you are and if they know you they might ask you to leave the keys to your vehicle or your driver's license and you can take it for a test drive with your family and that's always a nice thing to do because you don't want the pressure of a salesperson there, which is what they were saying at Edmunds. They don't want that pressure of someone saying you got to buy this car. This is the right car for you.
LIN: And you're a woman, I mean I have to ask that because I'm a woman and if I go shopping I'm going to feel like I'm getting taken advantage of so should I take someone with me?
FIX: Well, I don't know. I think it depends on the person and your personality. I don't usually have that problem because I walk in there knowing what I want in advance. And, nowadays the dealers have been trained, and I used to do dealer training, to expect women to come in more educated, so the more you know is more valuable to you. Whether you go out and get on the Internet and you get all that information or you buy a bunch of magazines that are available the more armed you are.
When you walk in they're going to know you know what you want to talk about and what you're looking at. They know you don't want to look at that lit vanity mirror and that other things are more important to you.
LIN: Right, right. Now how do you know? Can you know ahead of time if you're going to get a lemon?
FIX: Well, there's a lot of things. If you're buying a used car off a used lot that's different because you don't know or from a private owner. If you're buying a new car and you get a lemon that's really unusual and rare but that's why that protection is there and the government has put that in place for that reason.
If you're buying a new model you should expect they may have a few glitches and the manufacturers do try to sort that out before they go out to the market and start marketing a new vehicle. So, if it's a new model that's never been out before it's possible there might be a few things.
I've had a few issues that way but they're not lemons. They're usually corrected quite quickly by the dealership and they always want to make you happy. These days they've been trained to expect that things happen. Used cars are a different story, however.
LIN: Right, all right.
FIX: (Unintelligible) lemon out there.
LIN: All right let's talk about used cars in a minute but let's focus on new right now.
FIX: OK.
LIN: You say take advantage of rebates. Are there a lot of rebates out there right now?
FIX: There are a lot of rebates out there right now. There's a lot of cars in the lot left in the 2003 model year. Now is the time to pick up a 2003 if you're looking at a new car versus maybe buying an '04.
There are rebates and there are incentives but, remember one quick tip. Just because there's rebates and incentives and low financing that doesn't mean you can't barter, so make sure to barter in addition.
Now, a lot of time people feel uncomfortable. Well, they're already giving me back this money. No, that money is coming back from the manufacturer. It's not coming back from the dealer so the dealer still has room to move because they still get hold back, which is money that's given to them for selling that car through that dealership.
So, keep in mind that if you go into a dealership and you ask for a certain car and the guy says well there's a great rebate or the gal says a great rebate and financing you should be happy with the price we offer you. There's still room to move.
If that manufacturer or that dealer won't move go to a different dealer. Again, get three prices, just like you said earlier and balance them off and the one who can give you the best price or the best service to go along with that will be the car to buy.
LIN: All right. This was really interesting, best new car values. In taking a look at this we see the Lexus GS 300 in the luxury sedan category, sports car would be the Acura RSX Type S, midsize SUV, Honda Pilot, are these justified do you think? Are they going to hold their value if you want to resell?
FIX: They do hold their value and if you're looking for a used vehicle you can usually get a good deal by getting a car that's one or two years old that maybe someone traded in off a lease or maybe they want to upgrade to a different vehicle. They are good vehicles and a lot of domestic manufacturers have good products too.
If you're looking at trucks, Ford and GM and Dodge always make great trucks, so you want to look on the Web site before you go and buy a used vehicle to find out. There's lots of message boards and things that are going on and at "Talk to DIY" we get a lot of questions for automotive about different things that people have problems with.
So, it's your responsibility to be car care aware before you buy a used vehicle or when you're looking at maybe one or two years old. Get on the Internet to start searching magazines to find out which vehicles are having more maintenance problems than others.
Sometimes it's not the car. Maybe it's just like an automatic transmission has less problems than a manual transmission on the specific applications so check that out.
LIN: Now, is there an age of a car like two years, three years out, where you figure most of the losses have been a washout, you know, and from that point on your used car can hold its value?
FIX: Usually after three years if you've purchased a car after three years is a good opportunity to sell it. If you buy a car and sell a car every year you're really not getting your best investment.
To get the most out of your money you really need to keep that car three years. Now, again, once that car is three years old or if you put a lot of mileage on it once it gets over 50,000 miles don't forget to maintain that vehicle so you can get the most for your money.
People forget about that. Again, being car care aware is part of taking care of the maintenance on that vehicle so it will last 200,000 miles and, believe it or not, they do these days. Nissan Pathfinders, I've got a friend who's got on with 300,000 miles on it.
LIN: Oh, my.
FIX: And still running strong.
LIN: I want to know her mechanic. Okay, stay right there Lauren. Your calls and e-mails are next on DOLLAR SIGNS. You can still send your question to dollarsigns@cnn.com or call in. That number is 1-800-807-2620. We're going to be right back.
(COMMERCIAL BREAK)
LIN: Welcome back to DOLLAR SIGNS. We're talking about buying cars and how to get the best deal. Automotive expert Lauren Fix is with us in Buffalo, New York, to answer your questions.
Hey, Lauren we've got a call from Susan in Ohio -- Susan.
SUSAN: Hi.
FIX: Hi, Susan.
SUSAN: I have to talk fast because my phone battery is dying.
LIN: OK, go ahead.
SUSAN: I am in the process where I'm ready to buy a car but I'm really dreading the pressure and the politics that are involved so I'm wondering what the best resources are for buying my new car in terms of negotiating and preparing myself and my confidence. And, also, I'm wondering about any dot coms. Once in a while I see those on people's license plates.
LIN: OK, Susan, so Lauren where should she go?
FIX: Well, so far as the Internet there are some great sources. One of the ones you can use is edmunds.com. That's E-D-M-U-N-D-S.com. They are probably one of the most comprehensive sites out there that I like to use because when you're looking for a car, whatever year, make, and model that might be, there's also four comparisons there in the same market that you may have not considered because some people say well I'm looking at a Toyota and I'm sticking with that.
But then maybe you didn't think of that Hyundai or that Honda that's in the same category, so make sure that you check them out because it might meet your needs and the price might be in your market.
Now, another important thing to check out when you're going to the dealership you want to get all that comparison information off the Internet or you can go to stores if you don't have access to the Internet and get "Consumer Reports" has a bunch of magazines out.
So, get everything that you need on information on your vehicle. Then call your insurance company. Find out what year, make and model you have. Tell them I'm looking at this. The first thing they're going to ask you is does it have airbags? Does it have antilock brakes?
All those things can help reduce your insurance payments. Keep in mind if you're looking at a Honda versus a Hyundai the Hyundai, believe it or not, may cost less but may cost you more in insurance so that's something you want to look at because that's going to be a factor that's going to add into your total cost.
And, of course, maintenance numbers are also available on the Internet, places like Edmunds and Kelly Blue Book are all out there. Kelly Blue Book is kbb.com and those will all help guide you in the right direction.
LIN: All right, thanks Lauren. We've got an e-mail from Raj who's on a budget and he writes to us saying: "I am deciding whether to buy a new car or a used car. I have a budget of around $12,000 to $15,000. Any suggestions?
FIX: Well, I think it depends how important safety is to you and, hopefully, it is very important because when you're looking at airbags you want to go with the most advanced airbags and antilock brake packages and, of course, those are going to be in the more expensive vehicles.
So, when you have about $12,000 to spend there really aren't very many vehicles that are going to fit into that if you're planning on purchasing that car. Now, if you want to have payments and you want to lease a vehicle you don't want to put that much down either. So, if you do have $12,000 to spend a few thousand dollars down makes a lot more sense than putting a lot of money down on a lease.
Now, if you've just got $12,000 in your budget and that's it, look for a vehicle that's about two or three years old. Some of the things you want to do is when you look at that vehicle make sure to take it to a certified technician before you make the purchase whether that's at a used car lot.
Go to your favorite technician. Have them look at these things because even a private seller, they say oh, yes, I had everything taken care of. Ask the questions first. Did you have any major maintenance done on this vehicle and if they say, yes, I had the motor replaced and the brakes, then it's important to say do you have receipts for that?
If you don't have receipts for that and you need to ask in that order then you have a problem with proving that this maintenance has been done properly. So, you want to make sure that you check out all the details of these vehicles, look at the brake pedals and see if they're worn.
Pop the hood and look to see if there's any greasy, grimy areas that maybe are caked up more than the other. Drive the vehicle to see if it rides funny, if the steering is bumpy. All those little details will help you buy a good used vehicle. Now if you buy it off a used car lot most states have a box that will say as is or there's a warranty involved. You want to make sure you get a warranty that's involved. As is means you bought it. You're going to be responsible for making those repairs and that's when you'll be calling to talk to DIY and Steve Ford and I will be answering your questions but you don't want to be in that situation.
LIN: Right. Boy, Lauren, I think you answered ten e-mails in one, all right. We've got Beverly in Louisiana on the telephone. Beverly, what's your question?
BEVERLY: Hi. I'm in the business of fixing to buy a new truck and I was wondering how low should I expect them to come down on the price. I'm paying cash.
FIX: Well, you can get them to come down on the price on trucks. If you're looking at a 2003 -- are you looking at a 2003 or '04 Beverly?
BEVERLY: If I can get a 2003, I'll go with that.
FIX: Yes, you'll probably get a better deal on an '03 and the real secret is buy at the end of the month that last week of the month because usually contests and all kinds of incentives for the sales people. So walk in there that last week of the month and you will get your best deal.
Also, if they say, oh, we've got incentives and great financing, Beverly, you're all set, still ask for a lower price because they've got to get rid of those '03s because they need room on their parking lot for the 2004s that are coming in so now is a great time to buy a new vehicle.
LIN: All right, Lauren we've got an e-mail from Nelson. He writes: "I am considering buying a 2004 Toyota Prius. I am not sure hybrid cars have any resale potential after you've owned them. Is it a folly to buy such a car from the financial perspective"? Now, the hybrid cars are, what, half gasoline, half electric?
FIX: Right and it depends on the vehicle and the manufacturer. Buying a new Prius is actually a really nice vehicle. I was at the product launching. We got to drive them. Surprisingly, they do have the power and so forth and they do have resale.
There are people that are extremely concerned about the environment and those vehicles do have resale down the road and, believe it or not, you will get unbelievable gas mileage. Some are claiming higher than 60 miles to the gallon so you're going to save money up front.
And, of course, the insurance will be less on that too but you might want to check on each and make and model on those environmentally friendly cars because some of them do have higher insurance rates.
So keep that in mind before you go out and buy this Prius, although it is a good vehicle. The resale on it should be good down the road as more and more vehicles are becoming more environmentally friendly.
LIN: All right.
Lauren stay right there because more of your calls and e-mails, we're going to be taking them right after the break. Be right back.
(COMMERCIAL BREAK)
LIN: Welcome back to DOLLAR SIGNS.
We're trying to take the anxiety and worry out of buying your next car. Automotive expert Lauren Fix is with us to answer your questions. Lauren, we've got an e-mail from Srinivas. I hope I'm pronouncing the name correctly.
Srinivas writes: "For a family of four could you give me a recommendation, a midsize sedan or an SUV, considering safety and room, also, a specific model, if possible?"
FIX: Well, I guess it depends what you have, how many children you have and how much cargo you carry. If you're like my kids you got everything from karate to dancing gear and I needed a big vehicle myself so I ended up going with a sport utility vehicle.
But, if it's just, you know, kids and they're little and you're just, you know, they're still kind of going to school and they don't have all those extracurricular activities there's lots of midsize -- I hate to pick a specific year, make and model and brand but there's a lot of great applications out there.
I happen to like the Nissan Ultima. It depends what you're looking for. The Nissan Pathfinder is great. Everybody makes great vehicles. Ford has some great vehicles, General Motors does, even Hyundai and Kia have put out some really great vehicles.
I think your best bet is decide how much gear you have to carry on a regular basis. Are you the mom taxi or the dad taxicab driver where you're hauling all that stuff with you and how many children you're carrying?
If you've got four or five children you're going to be forced into a minivan. If you've got just two children then it's a different situation. I happen to be a truck person too, so I guess it depends what your needs are. If you're hauling a boat then you're going to need to have a truck.
If your needs are traveling a lot, you do a lot of family vacations and maybe you've got to bring the baby carriage and the little playpen and all the baby stuff, then you're going to need a minivan or something with a large trunk.
So, make sure you check that out. Honda makes some great vehicles. The new Odyssey is great. The Toyota Sienna is an excellent minivan. They key thing is check for crash test ratings. Your most precious cargo is your children and so you want to go to a place like National Highway Traffic Safety Association, which is nhtsa.gov. It has all the crash test ratings.
Get the most safety you can and as far as safety in sedans versus minivans, minivans many of them have rollover protection and side airbags. Remember, side airbags do not blow out at you just like a front airbag does.
It actually comes down. It's a curtain that protects your head and torso from a side impact so those are things you want to look at, antilock brakes, and remember when you add all these safety items up it also reduces your insurance. So, these are some of the things you want to look at crash control, all those things make a difference, keep the vehicle more safe.
And, another thing is if you're buying a used vehicle and maybe you don't want to buy that new vehicle and you want to find a technician and you just can't find one in your area or you're new to an area, there's a Web site called carcare.org and they actually will help you find a technician in your area that's certified so that you're getting a good deal.
LIN: All right. Thanks so much, Lauren.
FIX: Thank you.
LIN: Lauren Fix, great advice today.
FIX: Thank you.
LIN: Well, CNN has it all this afternoon. America's favorite sitcom "Friends" is profiled next on "PEOPLE IN THE NEWS."
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