Jessica Reinhardt

The Thousand Oaks Branch, Located Near the Auto Mall

If you are currently in the market for a new set of wheels, there are many different choices---and a couple of great bargains to be had in the slowing economy. With all the choices out there, it's easy to get overwhelmed and confused about what is actually the best deal out there for you and your family. When shopping for a new (or new to you) automobile, here are a few things you should keep in mind as you start shopping.

Do The Math: How Much Car Can You Really Afford?

0% financing is a great enticement to get shoppers into the showroom. Unfortunately, most of those shoppers don't qualify for the 0% and those that do may not be able to afford the high payments on such a short loan term. Before letting yourself be swayed by the 0%, negotiate a favorable price for the auto first. Always negotiate the total price of the vehicle before discussing financing. A great option many people forget is that your credit union can pre-qualify you for a loan -you'll know stepping into that showroom how much you can afford and what your interest rate will be. You can run the numbers with a trained professional in a neutral location, which can take the pressure and sense of urgency away from your decision. When you go to the dealership, your attention can then be focused on what you came to do...get into the best new set of wheels for you.

When calculating the payments for your new car, be sure to look at different payment terms and how much your down payment might affect your payment options. Longer loan terms (72 months, 84 months) can help keep your payments low. How long do you plan to own the vehicle? On average, an automobile owner will keep a car for two years. If you like to change vehicles regularly, be careful not to end up upside down in your loan. If you owe on a vehicle you're trading in, the dealership may offer to "do you a favor" and roll that old debt into the new vehicle. Now the loan on your new vehicle is much greater than the value. If you try to trade it in two years down the road or sell it, you could again have an even larger deficit.

Insurance is a must. One key to remember about insurance is that it covers the value of the vehicle - not what you owe on the vehicle. Here again, if you are upside down on your loan and have an accident, your insurance is not going to cover the additional amount you owe the lender and you'll have to come out of pocket with that money. If you purchase a new vehicle with 100% financing, you're upside down as soon as you drive off the lot. A good coverage to think about in addition to your regular insurance is GAP insurance. For just a few dollars a month, GAP covers the difference between what the insurance company values the vehicle at and what you owe. When you purchase your next vehicle, make sure to include GAP.

When negotiating a deal on your auto loan, ensure that you've taken all auto-related expenses into consideration. Whether you can afford the monthly payment or not is only a slice of the whole pie. In today's economy, fuel expense can be a huge factor - how many miles do you drive weekly and how many miles per gallon does your perspective vehicle offer? Can you afford $200 per month in gas? $300? $400? Before you think about adding those chrome 22inch rims, what about all of those unglamorous expenses you'd rather not think about ---such as insurance, registration, oil changes, tires, etc. It all adds up - just make sure that you're comfortable with the other expenses in addition to your monthly payment.

By spending a few moments with your checkbook and a calculator, you can make sure that you feel nothing but the wind in your hair when you drive off the lot. New car smell lasts about two weeks, but buyer's remorse can linger like a fast food wrapper under your seat if you aren't prepared.

Have a question about buying a car or opening an account? Pacific Oaks Federal Credit Union is a full service financial institution with five branches conveniently located throughout Ventura County. For more great financial tips, be sure to listen to AM 1520 on May 12th at 3 p.m. when our Marketing Manager, Tina Hernandez will be a guest on the Maria Sanchez show.

Pacific Oaks Federal Credit Union is firmly committed to helping our members and the residents of Ventura County achieve their financial goals. For more information about Pacific Oaks, please visit our website at www.pacificoaksfcu.org.