Purchasing a Vehicle

Buy or Lease How much wear and tear you plan to put on the vehicle? How much will you drive the vehicle? – (12,000 to 15,000 per year) How long do you want to keep the vehicle? Monthly lease payment are usually lower than monthly loan payments. But may be additional costs at the end of a lease.

Buying Make a down payment – Typically 10% of the vehicle’s value – If you have bad credit, you may be required to pay a larger percentage – The larger the down payment, the less money you have to borrow. – The value of a trade in counts towards the down payment

Buying Loans – Shop for the lowest interest rate – A low interest rate over a long period of time may cost you more than a higher interest rate over a shorter period of time. – Before you sign anything, be sure to understand ALL the repayment terms and what you will owe

Buying Monthly payments – Amount depends on the down payment – The payments remain the same for the length of the loan – The amount that goes towards the interest gradually decrease and the amount towards the principle will increase

Buying The lender is the owner of the vehicle and keeps the title – Title: legal document that shows who owns the vehicle

Leasing Leasing: make monthly payments in exchange for exclusive us of the vehicle for a specific period of time. – You do not own the vehicle. Leases are only for new vehicles

Leasing Up-front costs – First month’s payment must be made when signing the lease – Other Up-front costs Refundable security deposit Taxes Registration fees Acquisition fees Capitalized Cost Reduction: like a down payment the results in lower monthly payments

Leasing Monthly Payments – Lessee pays for the vehicle’s depreciation – Interest to leasing company in return for use of the vehicle

Leasing End-of-lease costs – Disposing fee – Charges for exceeding mileage limit Significant wear and tear Ending the lease early – Considerable penalty fee

Vehicle Maintenance

Maintenance Schedule Owners manual contain a time table for routine servicing You should put aside money for serving and maintaining your vehicle

Items to check regularly 1.Windshield washer fluid 2.Engine oil 3.Transmission fluid 4.Brake fluid 5.Tire pressure 6.Radiator coolant 7.Lights 8.Battery

Service facilities Dealerships Service stations Specialty centers – Muffler, brakes, transmissions, etc If the car is under a warranty, take it to the dealership

Maintenance Costs Get an estimate – Shops cannot exceed the estimate without your permission Replacement parts – Rebuilt/reconditioned parts Cheaper But may void warranty

Maintenance Costs Recall – Manufacturer’s request for owners to take their vehicle to a dealership for repair – Usually a safety reason – Manufacture usually pays for everything – Recall notices are usually mailed directly to owners

Responsible Driving Know and obey traffic rules Stay focused on driving – Cell phone, etc Stay alert Buckle up – Young children rid in safety seats Drive smoothly – Sudden stops and starts waste fuel – Cause wear and tear

Auto Insurance.

Auto Insurance Systems Traditional Fault System – Insurance companies pay claim according to each person’s degree of fault or responsibility for causing the accident – Can result in costly court cases No-fault Insurance System – No fault or blame is assigned – Limits the rights to sue other drivers

Types of Coverage Collision Coverage – Pays for the repair or replacement of your own vehicle – Usually, the insurance companies will pay no more than the current value of the vehicle (depreciation) minus the deductable Deductable: set amount an insured person must pay per loss before the insurer will pay benefits Totaled: damage beyond reasonable repair.

Types of Coverage Comprehensive Physical Damage Coverage – Protects your vehicle against risks unrelated to traffic accidents Fire, hail, theft, vandalism Liability Coverage – Covers injury or damage to other people or their property – Required by most states

Types of Coverage Medical Payment Coverage – Pays for immediate and short term medical treatment costs – Usually covers passengers in your vehicle too Personal Injury Protection – Covers medical expensives – Also covers lost wages, rehabilitation, nursing home

Types of Coverage Uninsured Motorists Coverage – Hit and run – Some else causes the accident and does not have insurance – Other driver has too little insurance Other Types of Coverage – Roadside assistance, towing, rental car,

Affected by… Age Gender Marital status Driving record Type and age of vehicle Vehicle use Place of residence Number of drivers on the policy Auto Insurance Rate

In Case of an Accident Safety first Call the police is property damage, a person is or a law appeared to be broken Don’t discuss the accident details to anyone except a police officer Call insurance company – They will help with procedures!

In Case of an Accident Exchange information – Name – Insurance company – Policy number – Driver’s license number – Name of owner of the vehicle – License plate number – Vin number – Witness names and phone numbers