Cars in the US are inexpensive compared to Australia, however there are some traps.
Used cars are often the most economical way of buying a car, and often requires you to purchase through a used car dealer (or pre-owned car dealer). There is one very high pressure tactic which is often used that you should be aware of:
- You negotiate the price of the car with the sales guy.
- They pre-approve your finance (even if you didn't ask for Finance and are willing to pay cash). Remember they don't want your cash, they want you to take a loan because they get commission from the finance company. As an Aussie you probably have a crap credit rating so they LOVE that you will get a terrible interest rate (more commission for them). On a $20,000 car you should aim to pay $15k in cash and $5k on finance so that you can improve your credit rating without being savaged too much by the rates. Car loans are one of the best ways to improve your credit rating.
- Once you get finance pre-approval, then you'll be taken into the "Finance" guy's office. Supposedly you're just going to transfer the title and sign the finance paperwork. But this is where the high pressure tactic is deployed. The finance guy will insist that you must buy the extended warranty and that you really must buy the lifetime maintenance plan. These two items can cost up to $7,000 alone. He has heard 100 people say they don't want these products and so he is ready with a barrage of rationale as to why you absolutely would be a dickhead if you didn't buy it. In my experience they are not good value, and in my experience they made me pay for the maintenance plan and then found every possible reason, everytime I had to get my car serviced why the maintenance plan didn't apply. It was a complete rort.
Leasing cars, is a good way to go as well if that suits your circumstances.