How to buy a new car? A step by step guide – Must read

Buying a new car is always awesome but Do you know how to buy a new car? have you completed your homework?

If no, you’re at the right place – continue reading

Buying a new car could turn your life into a luxury world but in some cases, it could be the worst decision you’ve ever made. This is the big financial decision you’re going to take. So be careful

Today I’m going to tell you some important points you should consider while you’re planning to buy a new car.

Let’s start

Note:  Don’t forget to read some other important points in the end regarding how to buy a car.

How to buy a car? – Most important steps

Following are some important points you must take into account.

How to buy a car

1.    Identify need – how to get a car?

Ask yourself following questions,

  • Why I’m going to buy a new car?Do I need a car for my family also? Or I’m just all alone 😊
  • If for family, how many members we are in total? So, my car should have a trunk for luggage. Right? For families, sedans are used commonly but You have other SUVs choices
  • Do I have enough money to buy a new car?
    If yes, how much exact amount I could pay for a vehicle?

Some important Suggestions:

  • Set your priorities about features and specification
  • Select which car body type will fulfill your need, a hatchback, a sedan,  SUV, or minivan or else?

At the end of this step, you will have a car body type selected and your preferred features list.  

2.    Set your budget – how to buy a car with cash?

What you have decided about the budget? Do you have the full amount in hand to pay or you are looking for a long-term loan plan?

You have two options,

  • The first option, you have full cash in hand to pay, so it would be easy to search vehicles according to your financial budget.
  • The second option, you have some money and you’re looking for a loan plan for the remaining amount.

Some important Suggestions:

  • Check all price factors and set the budget accordingly – check below

(For example: if you are setting 15 lacs as your new car budget, it doesn’t mean you can afford a car of 15 lacs. You have to pay dealer’s fee, taxes etc. so consider them also)

  • How much amount you can pay as a down payment?
  • If you’re looking for a loan plan, check all loan providers, read their terms and conditions and the monthly or yearly amount you’ve to pay. Make sure you are able to pay this amount.

Some Price Factors:

  • MSRP (Manufacturer’s suggested retail price):

Manufacturer set a recommended price for a vehicle on which a distributor can sell this product. Dealers can sell at or below this price depends on the availability of the vehicle. 

  • Invoice price

The actual price dealer pays to the manufacturer when receiving a vehicle from the factory.

  • Purchase price

The actual amount customer pays for a vehicle.


Buying a new car is great but Insurance is the necessary step that will cost you some extra amount but it’s for long term security of your vehicle so it’s better to take an insurance plan from a known insurance company.

How to get a car - insurance
  • Get a quote from an insurance company about your car options
  • Check their monthly or yearly premium you have to pay
  • You can also check vehicle options given by Insurance dealers

At the end of this step, you should have a clear picture of car financing.

The process of how to buy a new car isn’t complex but want you to spend some time before actually going for it.

Anyway, the next step

3.    Research – prepare a list of cars

Complete your homework by doing research on all available vehicles, their features and specification come in your financial budget range.

There are many resources you could use for research

Some important resources for information,

  • Automobile websites e.g. if you’re looking for Toyota vehicles Toyota Indus and JDMToyotaCars are recommended for Pakistan. 
  • Talk to people on social media sites e.g. Facebook groups
  • Ask questions on questions/answer forums e.g.  
  • Ask from friends/ family members
  • You can check consumer report on the best & worst cars of the year here.

You’re in the process of how to buy a new car and at the end of this step, prepare a list of almost 5 cars that come in your financial range and fulfill your need

4.    Research part 2 – select final options

Now deep research on cars you’ve selected in the list,

  • Check features, specification, price, pros, and cons of these cars on automotive websites
  • Ask on social media networks and discussion forums about these cars
  • Take feedback from friends if they own any car in the list
  • Check availability of auto parts of in your area
  • Check maintenance cost also for these cars


  • Select a car that is less expensive to own even it is expensive to buy
  • Select at least 2-3 car options

At the end of this step, you must have final cars options (2-3) that fulfill your requirement

5.    Find local dealers and book a test drive – how to buy a new car?

Now check the local dealers for the models you’ve selected.

  • The Internet is the best source you can check local dealer’s websites
  • Book a test drive online o website or through call


  • Carefully observe things during the test drive
  • Insist almost 2 – 3 car’s test drive

You’re in the process of how to buy a car At the end of this step, you’re able to finalize the car with all the features you need.

This image has an empty alt attribute; its file name is Test-drive-how-to-buy-a-car-1024x576.jpg

6.    Get the quote – how to buy a car from a dealer?

It’s time to get the quotes from the local dealers,

  • Check the price of models on other websites/social networks also to check what’s the price other people are paying for the same model.
  • Get quotes from dealers over the call or by email
  • Get quotes from internet sales managers also
  • Insist both send you a softcopy of quotes on email/fax
  • Check the difference between the prices


  • Select a dealer who is giving you a reasonable deal
  • You must have a copy of the quote before actually visiting the dealership center
  • If a dealer increases the amount or doesn’t agree on the price he sent on Email, walk away simply

7.    Close the deal

This is the last step of how to buy a car. Now review the Document thoroughly, check warranties, sign it and close the deal.

How to buy a new car from dealer

Some Important points – must read

  • Don’t sign any agreement without understanding it 100%.
  • Don’t agree on price greater than the price promised on the quote.
  • Avoid four-square sheet – a trick used by sales manager at the showroom 
  • Don’t need to buy unnecessary extras

Some other options – might be helpful

  • Some auto businesses are offering services like come with an old car and get a brand-new car e.g. in Pakistan
  • Check car exchange programs
  • If you travel in within city mostly, Hybrid cars are recommended because they offer you almost free drive. Read more about what is a hybrid car?

Buying a car is exciting but be sure about everything related to this process. It’s better to have some knowledge than just go as a blank face.

So, that’s all for today. Hope this reading will increase your knowledge about how to buy a new car.

Share your experience in comments. Feel free to ask any query/questions.

Thanks 😊

8,326 total views, 10 views today

Share it on:

Post a comment

You must be logged in to post a comment.