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Frequently Asked Car-Buying Questions


An informed consumer is a smart consumer - and who doesn't enjoy working with smart consumers? That's why we've compiled this list of frequently asked questions - all about the car-buying process - so that you can start with a solid foundation of information to assist in your car buying process. This list will continually evolve so be sure to check back for more information.

Buy or Lease

Q:I am looking at a new vehicle and am confused whether I should obtain a loan and buy it or if I should lease the vehicle.

A:Leasing the vehicle will generally get you into a new car for a lower monthly payment than if you were purchasing it. However, at the end of the lease term (commonly 36 months) you do not own anything. If you always like driving a new car with the assurances of being under factory warranty, then leasing may be for you. If you  like the idea of driving a car without payments for a couple of years, then purchasing may be for you. Also, purchasing the car makes more sense if you drive more than 15,000 miles per year, usually drive the vehicle for 5+ years or like to alter the vehicle's appearance. Check with your tax advisor for the tax benefits that may apply when purchasing or leasing a vehicle if you use your car for business purposes. 

    Mileage Estimates

    Q:Why don't I get the gas mileage listed on the sticker?

    A: It's important to understand that the gas mileage ratings on the vehicle's original window sticker are estimates. The manufacturers follow federal guidelines to test new vehicle models. The tests are completed in controlled laboratory settings. A dynamometer, a machine that allows the vehicles to simulate driving conditions, is used while engine emissions are monitored to calculate the amount of fuel consumed. The key takeaway is that these are not the actual driving conditions that cars often encounter. The city and highway tests are done in a controlled temperature setting (between 68 to 86 degrees F) without the car's air conditioning on. Also, for drivers in colder climates, expect gas mileage to decrease.  Fuel economy tests show that a conventional gasoline car's gas mileage is about 12% lower in 20-degree (F) weather than it would be in 77-degree weather, and it can drop as much as 22% for very short trips (three to four miles)

      Price Fluctuations

      Q:I just noticed a pre-owned Camaro's price increase. Why is that?

      A:Pre-owned vehicle prices are volatile. Just like in the clothing industry, where summer gear prices drop in the Winter and rise in the Summer, cars built for dry roads will be more expensive in the Summer than they will be in the Winter since demand is higher when the weather is warmer. If you're going to purchase a sports car in the near future, get it done in the winter. 

        Certified Pre-Owned (Used) Cars

        Q:What is a certified pre-owned car?

        A:Certified pre-owned cars have been through a thorough inspection by a qualified technician. After the inspection, the vehicle is issued an extended warranty that is backed by the manufacturer (GM's is a 1-year/12,000-mile warranty). Most certified pre-owned vehicles have low mileage, are within three to four years old and have no major damage. Certified vehicles will generally cost more than a comparable pre-owned car since it comes with an extended warranty that is backed by the manufacturer.

          Trade In Valuation

          Q:I am looking to sell my car and want to find out how much it is worth. What are good resources to use to help me appraise my car?

          A:We recommend using Kelley Blue Book or Edmunds. These websites can be used to estimate the value of your vehicle and help you look for a new one. To get the most accurate estimate with online calculators, be realistic when identifying the condition of your vehicle, as none of these calculators are as discerning as a human, dealership appraiser. Often car shoppers are disappointed when they bring in their vehicle for an in-person appraisals because they entered their vehicle's conditions as "good" on Kelley Blue Book (or Edmunds) when in reality it was actually in "fair" condition. 

            Exchange a New Car

            Q:Is there a three day exchange or cancellation policy mandated by law when buying a new automobile?

            A:The three-day cancellation policy (sometimes called the three-day cooling off rule) generally applies to door-to-door sales or sales made away from the normal business location. When buying a new vehicle, unless it is written into the contract or mandated by local law, you cannot return it after you have signed the paperwork and taken possession of it. However, with pre-owned certified vehicles, even if purchased on store premises, owners have a 3-day/150-mile grace period to return the vehicle. Regardless, it is important to read the fine print before making your final decision. Check with your local consumer protection agency to find out what is applicable in your area. For more information, go to www.consumeraction.gov

              Flooded Cars

              Q:When buying a used vehicle, how do I tell if it has been in a flood?

              A:Especially after hurricanes, thousands of flooded cars are transported to various locations around the country for sale. Cars that have been submerged can have a variety of problems. The seller should disclose this information, but some will try and cover it up. Inspect the trunk area for musty smells or debris. Inspect the instrument gauges for moisture and make sure they work. Test all the electrical components (e.g., power window, power seats, headlights, radio, heater, AC, etc.). Look into the heater vents for mud or moisture. It is also a good idea to run a vehicle history report through a company like CarFax. (Newman Chevrolet offers CarFax reports on all of our pre-owned vehicle's information pages). Finally, check with the Better Business Bureau to see if the company you are dealing with is reputable. 

              Q:Can I trust Carfax?

              A:There's a reason why Carfax is so widely used - it has the capacity to provide an extremely comprehensive report on a pre-owned vehicle's history. That being said, it doesn't always provide every bit of information. Unfortunately, Carfax is only as good as the information reported to it - and not everybody reports everything. It's always good to dig a bit deeper by asking the dealership for more information. They might be trying to hide something. 

                Miles Per Year

                Q:I am looking at purchasing a pre-owned vehicle. What is a reasonable amount of miles a vehicle should accumulate per year?

                A:The average driver puts on around 12,000 miles per year. When looking at used cars, try to determine the driving habits of the previous owner. Highway miles generally provide less wear on the vehicles engine and transmission than large amounts of stop and go city driving. Also, inspect the vehicle's maintenance records (CarFax) to confirm that periodic maintenance has been performed.

                  Free Credit Report

                  Q:I have had some financial problems in the past and want to know what my credit score is before I go into a dealership to buy a new car. Where can I get this information?

                  A:The consumer reporting companies (TransUnion, Equifax and Experian) are required under the Fair Credit Reporting Act to supply you with a free annual credit report. You can request a credit report every 12 months. To obtain your report, go to the collaborative website set up by these companies at www.annualcreditreport.com or call 1-877-322-8228. Be careful to only use this site. According to the Federal Trade Commission, there are impostor sites that advertise free credit reports. For more information about the Fair Credit Reporting Act, go to www.ftc.gov.

                    Gasoline vs. Diesel

                    Q:I am considering buying a new car but don't know if I should get one with a diesel engine or a gasoline engine. What are the main differences between the two types of engines?

                    A: A diesel engine is a compression ignition engine while a gasoline engine is a spark ignition engine. Diesels do not have spark plugs to ignite the fuel, resulting in lower maintenance costs. Even though gasoline engines usually produce higher horsepower, diesels turn out more torque. Torque is crucial for pulling. For trucks used to tow or haul heavy loads, a diesel may be the better choice. Diesel engines are more fuel efficient and have a longer life, but tend to initially cost significantly more than gas engines. Gasoline engines start better in cold weather. Even though both types of engines produce pollutants, diesel engines emit more particulate matter (i.e., small airborne particles) that can damage the lungs. 

                      Hybrid Vehicle Tax Incentives

                      Q:How much of a tax incentive can I get for buying a new hybrid vehicle? What hybrid vehicles are eligible?

                      A:According to the website, www.fueleconomy.gov, both electric vehicles and plug-in hybrids are eligible for federal tax credits up to $7,500. The credit amount will vary based on the capacity of the battery used to fuel the vehicle. Small neighborhood electric vehicles do not qualify for this credit. Click here to learn more.

                        Payload Capacity

                        Q:What does "payload capacity" mean exactly?

                        A:The technical term, payload, is the weight of the passengers and cargo. The payload capacity varies depending on the engine, wheelbase, body type and suspension system. Automotive manufacturers offer many options including "Heavy Duty Payload Packages." Adding this option can increase the payload capacity 1,000 pounds on some models.