Auto

Buying a car is an exciting time that’s often overwhelmed with a focus on the particulars: new car vs. used car, safety ratings and even color. Before getting carried away with the details, there are steps you can take to put yourself in the driver’s seat.

Determine your budget.

One of the most important first steps down the path to new car ownership is deciding on a budget. It’s important to be realistic here – buy only what you can afford. From this budget, you’re able to determine if you’re in the market for a new or used car, as well as the types of vehicles in your price range. Most advisors suggest your total monthly expenses (car payment, insurance, gas, etc.) not exceed 20 percent of your income.

Clean up your credit history.

If you’ve seen your credit score and know it won’t get you the financing options you’d like, take a step back and reassess. If your new car purchase can wait, consider working on improving your credit first. Low credit scores will result in much higher interest rates, causing the final price of your dream car to exceed the sticker price.

Shop for money before you start shopping for a car.

Getting pre-approved for your new (or new to you) car loan gives you added confidence as you shop for cars and negotiate a fair price, putting you at an advantage when you’re ready to buy. If you have questions or are ready to start the pre-approval process, speak to a UHCU loan specialist by calling 512.435.4444 or by applying online.

Know how to work the dealer.

Before you stroll into the dealership, do your homework. Show up with paperwork on market values, trade-in values and financing options.

Know exactly what you’re buying.

Be wary of dealer add-ons and up sales. Add-ons like service contracts and extended warranties can inflate the price of your vehicle. Check with United Heritage first; we often offer the same products as the dealership but at a much lower cost. And of course, make sure to read all the fine print before signing anything.

• How much can you afford to pay if you get in an accident? To keep premiums low you may want to discuss a higher deductible and be willing to pay more for repairs.
• What is the insurance company's level of service and ability to pay claims?
• What discounts are available? Ask about good driver, multiple policy and student discounts.
• What's the procedure for filing and settling a claim? Ask who to call and what happens after you file a claim.

Auto insurance protects you against financial loss if you have an accident. It is a contract between you and the insurance company. You agree to pay the premium and the insurance company agrees to pay your losses as defined in your policy. 

Auto insurance provides property, liability and medical coverage:

• Property coverage pays for damage to or theft of your car.
• Liability coverage pays for your legal responsibility to others for bodily injury or property damage.
• Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.

An auto insurance policy is comprised of six different kinds of coverage. Most states require you to buy some but not all of these coverages. If you're financing a car, your lender may also have requirements.

Most auto policies are for six months or a year. Your insurance company should notify you by mail when it's time to renew the policy and to pay your premium.

It's about protecting yourself financially.

• If you're in an accident or your car is stolen, it costs money -- often a lot of money -- to fix or replace it.
• If you or any passengers are injured in an accident, medical costs can be extremely expensive.
• If you or your car is responsible for damage or injury to others, you may be sued for much more than you're worth.
• Not only is having insurance a prudent financial decision, many states require you to have at least some coverage.