Buying a car in the murky atmosphere of today

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The media has reported it repeatedly: in today's economic climate people are passing on big-ticket purchases.

Well, not everyone. Some are feeling that now may be a great time to purchase a car.

That's because those in the business of selling cars also are feeling the pinch in terms of slow sales, and more are willing to work with buyers on price incentives or very low interest rate finance packages.

The signs are out there. General Motors recently ended its "Employee Pricing" incentive program - then replaced it with zero-percent financing and incentives on many models.

Toyota, one automaker faring decently during these crunch times, began its own zero-percent financing incentive and made it effective nationwide on many popular brands, including the Camry, Corolla, RAV 4, Highlander, 4Runner, Tacoma and Tundra.

Searching Pays off in Buying a Car

Take another view of the seller's dilemma and you might find a golden nugget of a sale.

For example, big trucks and sport utility vehicles aren't selling well for the obvious high-gas-prices reason.

So Chrysler is offering zero-percent financing for 72 months on those types of vehicles. This program features lease-like monthly payments in anticipation of closing down its leasing business entirely.

Low monthly payments sound nice when the job market and economy is so uncertain. But beware of the monthly cost of gas, and be careful with loan arrangements that go beyond 72 months.

Long loans expand the amount of time it takes to own the car outright - and by that time you may end up owing more than the car is worth with depreciation.

That can impact your ability to get financing for a replacement car.

The Internet presents new tools to figure out exactly how much you can afford. Sites such as Edmunds.com and Cars.com have calculators that indicate how much you can spend yet still keep monthly payments affordable, and maybe not have to extend the loan period beyond 48 months.

Secure a Loan First, Then Go Buy a Car

Too often, car buyers stick with financing packages offered by dealerships.

You might be amazed what you can get out of your own bank or a local credit union first, especially if your credit rating is good.

There also are sites such as CapltalOne.com that can pre-approve a car loan for you, up to a certain amount. Then they send you a check to take to the dealership - and the loan doesn't take effect until the check is used.

Securing such loans before entering a dealership presents advantages. They instantly know that you have a good enough credit score to get financing.

And they understand that it won't be as easy to get the auto financing business from you. That could provide opportunity to negotiate on price or further incentives.

Ultimately lowering the price helps in the long run by reducing principle and possibly shortening the term of your ready.

Car sellers often work with you today, and make sales. Ultimately, you need to know how many cars your budget and consider other cost factors, such as fuel, insurance, etc.