Your firstcar in usa - insurance

Your mobility depends too much on your possession of a private
vehicle. You may go for a car, motorcycle or truck as your own vehicle.
But due to severe weather conditions in many regions it is not a good
idea to depend on motorcycles all the time. It is also not a good idea
to have a truck or SUV as they drink lot of gas and the maintenance is
high. Somewhere in the middle and perfectly positioned vehicle for Desi
would be a car. There are various types of cars to suite your need.

What you should have

If you are a single man and do not depend primarily on your car for commuting to your work, then go for anything as you wish.

There
are coupes which have capacity for 4 persons but only two big doors.
Primarily these cars are designed keeping in view for two, driver and
one passenger. The other model is the sedan which has capacity for 5 and
has 4 doors. This can also be called a family car. Depending on the
size of the car, they are categorized as Compact, Mid-sized and Full.
Compact cars are very small in size and have a good mileage per gallon
too. Some manufacturers even make two seated compact cars. The power of
the compact car is also little less than the cars of other categories.
There are other cars that have powerful engines and are rated as sports
cars.

On the contrary, if you have a big family and need more
space in your vehicle, then go for van/SUV. But I wont suggest this idea
to people who have just come to US, before/after marriage and don't
have any kids.

Besides, it is always your dream and desire that
makes you to go for a particular type and model. But before deciding
upon something, you must give a thought to the other factors like, the
mileage, sitting capacity, transmission, trunk capacity, engine power,
ease of driving/safety, interior, power doors and anti-theft devices.
Also your affordability plays a major role in purchasing a vehicle.

Do
you have a driver license yet? It is most important to have one before
going for a vehicle. Various states have different rules for issuing
drivers license. You can logon to Department of Motor Vehicles (DMV)
sites to know about the pre-requisites and methods of getting one driver
license for your state. Normally it involves a written examination,
minor vision test and a road test.

The never-ending comparison

Now
you have to decide whether to buy a new car or a used car. I wont
suggest you any thing or force you to go for what I think is right, but
you must know the good and bad things involved in each.

Used Cars

* They are cheaper.

* They may be old.

* They might have more than one owner.

* They could be purchased from private parties or authorized dealers.

* They might have gone through serious maintenance/repair in the past.

* They might have gone through an accident in the past.

* Some parts/components are just about to die.

* There may not be enough warranty/guaranty on some expensive parts.

* The mileage may not be good.

* They may need more maintenance.

* They may not be reliable for long drives.

* Resale may be a headache.

New Cars

* They are not cheap.

* They are covered under manufacturer/dealer warranty.

* Their fuel efficiency must meet the specification.

* There is the satisfaction of owning a new car.

* Easy to get a finance for new car than a used car.

* No need to worry about the engine, body, suspension, tyre, batteries and interior conditions.

* Insurance premium may be higher.

* Can only be bought from an authorized dealer.

There
are many other things that can be discussed as advantages and
disadvantages under both the headings. However, I don't want to focus on
them right now. If you are convinced to buy a new car, then go for it.

Your target

Now
it is the time for you to decide the Make, Model and Type of your car.
In US you will find hundreds of Make and Models (no Hind Motors/Maruti
cars of course). From a Desi prospect I would say it is better to start
with Honda/Toyota/Nissan. These Japanese car manufacturers know our
requirement and never ditch us on the highways. The engines are good and
prices are low. They run long enough before giving up. The life of a
Honda/Toyota is considered to be 300K miles. But the look and interior
designs are not at par with the American/European cars.

Buying a New Car

Take
a cup of coffee, chat with your friends and go through some reviews
before you decide upon the make model and color of your first dream car
in USA. Check for the existing/upcoming models of your car by logging
onto the sites. Select the color and interior and look at the car
through the simulator. The most important thing that you must consider
here is that, when the next model is going to be released. If it is very
soon, then don't go for it, because after you buy your car, you will
see the newer model in the market and the resale value of your car will
fall drastically.

Cars with automatic transmission and power
window have good resale value. ABS and anti-theft devices are added
advantages. Leather interior is as per your wish.

Now you have all
the details in your mind and the budget is also finalized. Next step is
to study the finance market and look for the bank/credit union who
gives the best APR. Also don't forget to decide upon your auto
insurance. Find out a good insurance company and try to get a quote from
them. The premium varies from place to place. With all these things set
up, go to the Auto-Mall of your city. Go for a test drive for the car
you have already decided. Beware of the car sales representatives. They
will always try to sale you the most expensive car they have. But you
shouldn't deviate from your decision. Try to bargain with them for a
possible reduction in their margin and ask for extra accessories.

What
is the status of the loan? Have you arranged one or you want the dealer
to make some arrangements for you? Always try to bring down the APR. If
you are very new to US and don't have any credit score, you may not get
a good APR. However, dont worry about the APR right now. You can always
refinance the loan with a better APR after you buildup the credit
history after few months of repayment of the loan.

Once the deal
is final, you need to sign some papers and then provide the Insurance
details if you have. Otherwise, you could also provide the insurance
agents phone number and the sales representative will talk to the
insurance agent to get the car insured before leaving their premises
(dont worry too much for the insurance premiums now, it is important to
get your car insured before you drive out of the dealers premises,
however you can easily change your insurance later, if you find a better
one). In case you didn't get any insurance, you can always go for
binder insurance, but they are quite expensive, but you can always
cancel them in the middle once you establish your insurance with
somebody else and get the refund for the unused portion of your premium.

The
next thing is to make the financial paper work. You will be guided to
the dealers accounts department and one of the accountants will assist
you in finalizing the loan and payment for the car. At that time they
will try to sale an extended warranty for another 3 years after the
manufacturers warranty. It is you who will decide for that. Don't listen
to them, but evaluate it being unbiased. They will try to sale so many
other things like paint guard, gap insurance etc. I would suggest not to
go with all these things except paint-guard.

After everything is
over, they will apply for the vehicle registration/license plate to DMV
on your behalf and give you the temporary ownership license (stuck to
the windshield of your car). As far as I know, they wash the car and
give you a full tank as a compliment before you drive your car back
home.

New cars don't give you much trouble as long as you do all the regular oil change and maintenance in time.

Buying a Used Car

Used
cars are good but not as new cars. They are much cheaper than the new
cars, but at the cost of your peace of mind. You can buy used cars from
either a private party or from any dealer. Here also you have to decide
your budget and the make, model and year of the car that you need. Also
the other main factor is the odometer reading.

There are many
sites that give you the links for used cars for sale. You can also refer
to the local news papers for any such advertisement. There are places
in some cities where people come with their cars for auction/sale. Since
you are new, don't go to such places. Rather get contact information
from news paper ads or internet. Get the details of the car like make,
model and year of the car, miles it has run, condition of batteries,
tires and engine condition etc.

Now go to Kelly Blue Book
(www.kbb.com) or Edmund (www.edmund.com) and try to evaluate the car.
KBB will ask you some question depending upon the private trading or
buying from dealer. After you enter data about the private trading car,
it will show you an approximate value of the car.

Private Party

If
you are buying a used car from a private party, then you need to be
more cautious about certain things like, the engine condition, the body
condition, the interior and the accident/maintenance history of the car.
Don't go for cars that have already run almost 300K miles (for Honda
and Toyota). You can start locating for used cars for sale from various
sources like, news papers, local ads and internet. After locating the
availability near your place, prepare your matrix.

* Call each of them to fix an appointment for trial.

* Get the VIN (Vehicle Identification Number) from the owner.

* Check for the approximate cost of the car using KBB or EDMUND sites.

* Compare the advertised price with the approximate cost that you arrived at.

*
Use the VIN to find out accident/maintenance history from CarFax.com
and check for any major incident. There will be a registration fee for
CarFax.com, go for the one month pack.

* Talk to a mechanic for
pre-purchase inspection of the vehicle. Mechanics charge around $50 per
car. It is better to go to some brand names like Pep-Boys. They are good
and reliable, but you may need to take an appointment beforehand.

*
Go to the owner, see the car physically (for any visible dents, body
color, torn airbag containers and interior) and then drive it with the
owner.

* Take the car to the mechanic and have it inspected.

*
(All the cars need a timing belt replacement after running for around
100K miles, so if the car is around or over 100K, then you need to
figure out if the timing belt has been replaced, this information could
be obtained from the CarFax report too. One thing you must remember
that, in US, the auto spare parts are not that expensive, but the labor
charge to install them is too high.)

* The mechanic will give you a
report, in which it will indicate the current condition of the car and
what needs to be fixed with a rough estimation.

* Check for the vehicle registration, is it current?

* Is the vehicle smog certified?

With
the Kelly Blue Book report, CarFax report and the mechanics report, you
can have a good bargain with the owner. If you really like the car and
every thing looks OK to you, then start bargaining. Don't focus more on
the tires/batteries, they are not that important as the engine.

NEVER BUY A CAR THAT HAS A SALVAGED TITLE.

Once
you have decided to buy the car, talk to the owner about the payment
and mode of payment (check or cash). The owner has to give you a pink
slip indicating that you paid for the car and it is yours now. He cant
simply lodge a complaint with the police saying you have stolen his car.
It is his duty to inform the DMV office about the sale and transfer of
title. You should also apply to DMV for transferring the title to your
name. For registration, you will need the pink slip, the insurance (get
one immediately) and smog certification. After you apply for the
transfer of the vehicle registration into your name, you are the proud
owner of the car.

It is too cumbersome to buy a used car from a
private party, sometimes it is too risky and in all the cases it is damn
cheaper. For some unlucky guys it might have resulted in spending huge
money on maintenance the next day. But it is not always true. However,
you are supposed to visit the mechanic frequently and spend lot of time
there.

Buying from Dealer

The next best thing that you can
do is to buy a used car from a dealer. It may not be as cheaper as
buying from private party, but 100 times more reliable. Even some
dealers give warranty on the used cars they sale. They buy the used
cars, clean them up, do a thorough checking of the engine and repair any
damages, dents etc before putting them on sale. You don't have to take
the car to a mechanic for inspection, worry about the smog
certification. But never forget to check the approximate price through
KBB and have a CarFax report handy before making a deal with the dealer.
Normally, good dealers don't keep cars for sale that have any major
issues like bad accident history, salvaged title etc.

Go to the
dealer, talk to the sales representative about your purpose. He/she will
show you all the different used cars they have that fits your
requirement as well as your budget. Once you have selected the model,
make and color, go for a test drive (don't forget to check the odometer
reading). If everything feels OK to you, then go to the dealers office
and access their computer to logon to KBB for approximate pricing as
well as to CarFax for accident/maintenance history for that car. Some
dealers even do this for free. Now with all these things handy, start
the bargain. You must always consider the worry free deal with the worth
of the vehicle you are paying for. You may end up paying a little more
than that of a private party deal, but there wont be any worries after
you buy the car. If there will be any problem with the car (which is
covered under warranty), you can always comeback to the dealer for
having it fixed for free. The dealer may also arrange a loan for you and
take care of the other formalities like title transfer etc. You will
save a lot of time/worries in this. Time is important and costly in this
country. So it is your call again.

After you finalize the deal,
it follows the same process as a new car purchase. So finish all paper
work and drive the car safely back home.

Tips

* If you own
an old used car that needs maintenance and the mechanic gives you a list
of jobs to be done, then do all of them once. That way you may save a
lot of labor charge.

* As per my experience, buying a new car is
always better than buying a used car from a dealer and buying a used car
from a dealer is always safer than buying a used car from a third
party.

* It seems to be a huge amount in the beginning to buy a
new car. But if you compare the money spent for new (repay the loan) and
used car (repair/maintenance), then over a period of 3 years they will
almost equate with each other. So, why not to enjoy the ride of a new
car.