If it is your first car that you are buying you are naturally wary and look for car tips to get the best deal. One of the most common dilemmas that most new car owners face is whether to buy a car with cash or seek a car loan .

It is a reality that many people opt for car loans despite the fact that they have enough cash . The flip side is that auto loan means you end up paying far more than the original price. Although the monthly interest payment appears to be a small amount, the total interest sums up to a substantial amount and makes a big difference.

The first thing that you want to do is some research on car buying tips and the type of scams prevalent in car dealer market. If you think that you will get the best deal on a car if you pay cash you are sadly mistaken. Car dealers are among the smartest marketers going around and no matter how many car buying tips you know and remember they always have something new up their sleeve.

One of the common car buying tips is not to tell beforehand whether you will be paying cash. It doesn’t work at all. That gives the dealer time to do some calculations . While you are looking at car models, the dealer is actually calculating his profit and busy finding ways of how to compensate for the loss of commission that he normally gets from the auto financier. Discuss auto loans with the dealer even if you intend to pay cash.

So, do you really want to get your vehicle financed ? It is actually a matter of preference and availability of ready funds.

Generally, you want to pay cash and avoid auto financing as much as possible . However, if you have adequate cash but have invested it in profitable financial instruments then you need to compare the return that you are getting on your investments with the rate of interest that you will be paying on an auto loan.

If your investments are giving you a decent return or expected to increase in future then you shouldn’t mind paying interest . A reputable auto loan provider will actually help you in finding a good car dealer and even suggest a good car model. Here again, you need to be careful and as a buyer you need to be careful. There is a possibility of a quid pro quo here also and the loan provider might be getting a commission from the car dealer.

Now, here is another one of those useful car buying tips: even if you opt for car finance, negotiate an auto loan by yourself without involving a car dealer . Auto loan providers have different terms and conditions for direct loans and loans through third parties. Apply for a car loan and start shopping only after it has been approved. No matter wherefrom the money is coming, as far as the dealer is concerned, you are paying cash. While you are at it you will do good to look for some car buying negotiating tips as well.

Actually, it pays to be careful when spending money on anything regardless of whether it is a big ticket purchase or routine grocery. ‘Buyers beware’ is one of the best car buying tips that you will ever get. This is true for buying a car with cash as well as with car finance.