Where are the Best Car Deals? – 2017-2018 Models

2015 best car dealsUntil the last few years, the best way to get a great car deal was … to work hard for it by haggling with stubborn dealer salespeople. With plenty of luck, careful preparation,  and a heap of negotiating skill, you might get a good deal.

You would increase your chances of getting a good deal if you knew the best time of day/month/year to buy, knew dealer invoice prices and holdbacks, and had good bargaining savvy— and possessed the stamina for long stressful haggling sessions with dealer salespeople who would try every trick in the book to wear you down — not a pleasant experience for many people. Most people hate it and don’t look forward to it.

It’s not that haggling still isn’t necessary. It is in many cases. But the best car deals don’t happen that way anymore. Things have changed. The best deals are actually given to you — without hagglingby major car companies in partnership with their dealers.

Car manufacturers, in these challenging economic times, are hungry for your business and are willing to offer ready-made deals that were offered much less frequently in the past. These are deals that buyers could not possibly negotiate for themselves — because dealers are not capable of making the kind of concessions that their deep-pockets parent car companies can make. You could haggle with a car dealer all day and all night and he still wouldn’t be able to give you large price discounts, rebates, bonuses, 0% APR loans, or give you special subsidized leases, if he didn’t have help from his parent car company.

Use Edmunds to find the best car purchase and lease deals currently being offered by dealers in your area.


Car Leases Less Than $300 – 2017-2018 Models

lease deals less than 400There are over a hundred special lease deals for less than $300 a month offered every month from different car companies. In fact, of all promotional leases being offered by car manufacturers, the majority fall into the range of $200 – $299 a month.

These no-haggle deals are put together by combining a discounted vehicle price with a higher-than-normal lease-end residual value, and a low finance rate (money factor). The deals are usually only offered for one month, although month-to-month extensions are not uncommon.

Since customers can only negotiate price, but not residual and money factor, these deals are always better than could be independently negotiated for a normal lease.

Special lease offers from car manufacturers are genuinely excellent (often, outstanding) deals that are “subvented” (subsidized) by car companies and offered nationally through dealers for those companies. Not all of a car company’s vehicle models and styles will be offered with special leases during a given month. If a particular model or style is not included, dealers are not authorized to extend the offers to other vehicles.


Cheapest Car Lease Deals – 2017-2018 Models

cheap car leaseSome of the cheapest car leases we’ve seen in a while are now being offered by car manufacturers with special limited-time lease deals.

These are deals in which car companies are creating the lowest possible monthly payments by temporarily adjusting a combination of factors, such as price and finance rate, that affect payment amount.  Although a low lease payment doesn’t necessarily make it a good deal, all the deals we discuss here are actually excellent deals and are well worth considering.

Nearly all cheap leases require a down payment (cap cost reduction) as well as the first month’s payment and official fees. These up-front costs, all together, are called “cash due at signing.”  Most of the deals are for 24, 36, or 39 month terms and allow 1000 miles per month, average over the life of the lease.

Here are some of the cheapest car leases that are currently being offered by car companies through their authorized dealers:


Best Car Leases Under $200 – 2017-2018 Models

best car leasesThere are currently a surprising number of good car lease deals for less than $200 a month being offered during February 2018 by car companies and their dealers.

The good news is that the number of cheap lease deals has remained generally the same over the last few months, and promises to remain so, or become greater.

These are special limited-time lease offers with low payments of $199 or less that are based on discounted prices (lease cap cost), low finance rates (lease money factor), and high lease-end residual values. Most require a down payment, first month’s payment, and any official fees at time of lease signing.

There is no other way to get a brand new car for less than two hundred dollars a month than through these special manufacturer-offered lease deals. 

All the leases we list below are for brand new 2017 and 2018 vehicles, although usually only for a few models and only one style of each model. The deals also are good only for a limited time. Nearly all are for 24, 36, or 39 month terms and typically allow 1000 miles per month, although a few allow more or less. In some cases, there are additional loyalty bonuses and/or competitive trade-in bonuses that could lower the listed monthly payment.

Where are the 0% APR Car Deals? – 2017-2018 Models

zero-loan-rateCars sales are still recovering from pre-recession levels and car makers are offering some very attractive incentives, including 0% APR no interest loans, to help get things moving again.

Some manufacturers are also offering cash-back rebates but, as you may already know, you generally must choose between the rebates and the special low-interest (or zero interest) loans. You can’t take both.

Often, rebates are a better deal, especially if you need down payment money (rebates can be used as down payment cash). However, in many cases, you don’t have a choice when only a rebate, or only a low-interest loan is being offered. See our article, 0% APR Car Deals – Good Deal or Not? for more details.

Here are some of the current car makes and models with 0% APR loan deals. Note that the 0% APR rate usually (but not always) only applies for shorter-term loans — 24, 36, or 48 month loans — and may not apply to all styles within a model line.  Terms and conditions can vary by car company.

Following are some of the current 0% APR loan deals for 2017 and 2018 vehicles.


$0 Zero Down Car Leases Are Back – 2017-2018 Models

zero down car leasesThis month there are just a few car makes and models with special car lease deals being offered with no money down. That’s $0 due at lease signing — not even the first month’s payment.

These are often called “sign and drive” leases. Lexus has the most no-money-down lease deals right now followed by Subaru. Check this page often because zero down leases come and go frequently.

Most zero-down lease deals allow 12,000 miles per year with the exception of those from Lexus which allow 10,000 per year.

Actually, almost any car lease can be had with or without a down payment, but you may not be able to get special promotional deals without money down unless the deal specifically makes that offer. All the promotional deals listed below do make the offer. Making no down payment doesn’t change the value of the deal. However, since you are not pre-paying some of your financed lease amount, your payments will be a bit higher.

All of the deals listed here will end February 28, 2018. Here are the current (February 2018) $0 down sign-and-drive lease deals, listed in alphabetical order:

How to Buy a New Car – 2018

More than one way to buy a new car

How to buy a carUntil relatively recently there was only one way to buy a new car — the old-fashioned way — the way it was done by our fathers and grandfathers.

But the Internet and new technology have changed things dramatically such that the old-fashioned way is not always the best way anymore.

In fact, the newer ways are almost certain to get your better deals with less work and hassle.

Let’s discuss each method now.


1. The Old-Fashioned Way

The conventional way to buy a new car was to visit a local new-car dealer or two, look over their inventory of vehicles, read the window sticker to learn about features and MSRP price, decide on a vehicle you like, maybe take a test drive, and then go discuss your possible purchase with a pushy sales person. You might try to negotiate a better price through a lengthy process of the sales person going to the back of the office to “discuss” it with his sales manager, returning later, and then repeating the process several times until you give in. Once an agreement has been made, you sign papers (another lengthy process), and drive away, having no idea of whether you got a good deal (Hint: You probably didn’t)

So what’s wrong with this method?


Best Lease Car Brands – 2017-2108 Models

best car lease brandsCar leasing has become popular again with automotive consumers after the near-meltdown in 2008-2010 when the car industry, and the economy, was suffering through the worst of a worldwide recession.

Nationally, leasing accounts for about 25% of car sales across all brands, and it’s growing as consumers continue to look for affordable ways to drive new cars. In fact, leasing is growing faster than sales.

As stated, the average rate at which cars are leased, not purchased, is about 25%. However, that rate is much higher for car brands and car companies that are “lease-friendly.” The average rate is dragged down by brands that aren’t as interested in leasing or who don’t have good leasing programs.

Generally speaking, American car companies such as Chrysler, Ford, and General Motors were the hardest hit during the recession and practically stopped leasing altogether. As a result, they’ve been the ones who were  slow to return but are now much stronger. On the other hand, Japanese and European brands continued to lease and are now the strongest in lease financing. Leasing numbers are highest with luxury brands, in the 50%-70% range.


Credit Scores Affect Your Car Deal

car deals - credit scoreYour credit score is a numerical representation of your credit history report, which includes details of all your credit accounts and loans, and how good you’ve been about paying them. It also reports any defaults, repossessions, or bankruptcies.

Credit scores, which for most people falls between 400 (poor) and 800 (excellent), are a major factor in determining the cost of buying or leasing an automobile.  It determines what interest rate you’ll pay, or even if you can get approved at all. It also determines if you will be allowed to take advantage of special new-car incentives, such as 0% APR loan and lease offers.

You have three credit reports and credit scores, one set from each of the three major credit agencies in the U.S. — Equifax, Experian, and TransUnion. When you buy a car with a loan, or lease a car, the dealer and finance company checks your credit score with one or more of the three agencies. Scores can be slightly different (sometimes, more than slightly) from each agency and you can’t control which agency a dealer or finance company uses.


How to Evaluate a Car Lease Deal

2017 car lease dealIs this a good deal on a car lease?

As you may already know from visiting this web site, many automakers regularly offer special limited-time car lease deals.

Or dealers may advertise “special” lease deals during promotional sales events.

Are these good deals, or just some dealer trick to get you into the store?

Lease deals are more difficult to evaluate than simple purchase deals. When you purchase a car, price is the only factor that makes it a good deal or not — unless you finance the purchase with a loan, in which case loan interest rate is also important.

Lease deals are different

When you lease, price is also important but so are lease money factor (finance rate), lease-end residual value, and fees. Many car lease ads and TV commercials don’t reveal all these important numbers.  With the combination of these factors and the fact that you don’t even know what some of the factors are, it’s difficult to evaluate such deals — but not impossible.

How to find out if a lease deal is good or bad

We have created a unique new calculator, the Lease Deal Calculator, that allows you to simply plug in a car’s MSRP (sticker price), the lease term (months), any down payment, and monthly payment amount to get a RLV Score that tells you immediately if a lease deal is Outstanding, Excellent, Good, Average, or Poor.

With this unique tool, you can compare different leases to find the best deals, or simply evaluate a deal that you’ve seen or that has been offered to you.

car lease deal calculatorFor example at the time of this writing, Toyota is advertising a special lease for the  Toyota Camry LE Sedan for $23,316 MSRP, $189/month, 39 months, and $2188 due at signing.  Of the $2188, $1999 is down payment and $189 is first month’s payment.

Is this a good deal? How does the deal compare to a similar Honda Accord SE sedan advertised lease deal of $25,450 MSRP, $270/month, 35 months, $0 due at signing ($0 down and $0 first month’s payment)?

We plugged in the numbers for the Toyota deal into the Lease Deal Calculator and the deals scores at 90, which rates as “Excellent,” just short of  “Outstanding.”

We then plugged in the numbers for the Honda deal and get a RLV Score of 97, which rates as a solid “Outstanding” which, with the higher score,  makes the Honda lease the better deal of the two.

It is fairly common for limited-time promotional lease deals from car manufacturers to be rated “Excellent” or “Outstanding”, especially from such companies as Honda and Toyota. Leases from other companies, particularly American car makers, may not rate as high.

This means that all such deals are worthy of consideration and are not a ruse by dealers to simply get you into the showroom. However, be aware that not all models and styles are included in these deals. If you don’t like the particular vehicle being promoted you may have to settle for a normal lease deal, which will not rate as high in the Lease Deal Calculator .


$0 Zero Down Car Leases Explained

zero down lease dealsIs it possible to lease a car with no down payment?  $0 down?


In fact most car leases, even those advertised with a “required” down payment, are also available with $0 due at signing.

Of course, the monthly payment will be higher since you are not pre-paying some of the lease obligation.

In general, for a modestly priced vehicle, you can expect your lease payment to be higher by about $40 a month for every $1000 you don’t make as a down payment.

Although all leases are structured so that a down payment is optional, some special lease deals offered by car manufacturers in monthly promotions may require a down payment in order to get the deal. You could do the lease without a down payment but the actual deal might not be as good (see LeaseGuide.com for details about how to evaluate a lease deal).

On the other hand, some manufacturers such as Honda often offer their special promotional lease deals both ways — with a down payment and without. Even though you pay a higher monthly payment with nothing down, the deal is still a good deal. See Special Honda Leases for recent examples.


How Much Do You Know About Car Buying?

Simple Test to Check Your Car Buying Knowledge

The process of buying a car has dramatically increased in complexity since our grandfathers’ days.

This means there are more opportunities to make mistakes. And it lets dealers take advantage of our lack of knowledge. Those of us who think we know how to be smart about car buying and financing may discover that we know less than is required.

You can find out just how much you know by trying our new Car Buying IQ Test. Answer a few questions and get your score. Also see the real answers when you’re done.

It’s Easy to Get What You Need to Know

The key to being a smart car buying consumer is research and preparation — before you ever visit a dealer. We are fortunate these days to have the Internet, which makes it easy to get the information we need.

Every car manufacturer has a web site from which you can learn about and compare models and options, as well as find special limited-time offers available through local dealers. Then there are sites such as Edmunds.com where you can get reviews, safety and reliability ratings, test results, discounted prices, and much more.

Consumer Reports magazine (and web site) provide a wealth of information, vehicle evaluations, reliability predictions, and owner survey ratings — for both new and used vehicles. Many savvy consumers consider this magazine as their car buying “bible.”

Insurance company sites provide quick online rate quotes on any vehicle you are thinking of buying. We like Esurance.com. It’s an Allstate company but is completely online without the costs of agent offices, which means lower insurance cost to consumers.

Finally, this web site, Best Car Deals, provides a wide variety of information and advice that is helpful to anyone thinking of buying a car.

Lowest Cost Car Leases. How?

new carsTo many people, all car leases seem inexpensive because the monthly payment is always 40%-60% lower than comparable loan payments for the same car, same term. But that doesn’t mean all leases are good or smart deals.

Let’s take a closer look.

If you are not familiar with leasing, you may not realize that PRICE is negotiable, just like when you buy. In fact, a lower price results in a lower monthly payment and the effect is more significant than then buying. In other words, even a small decrease in price creates a much greater lease payment decrease than the same price reduction when buying with a loan.

If you fail to negotiate a better price for your lease, or don’t know that you can, a dealer will simply base your lease payment on full MSRP sticker price.

The only time you won’t need o negotiate price is if the dealer or manufacturer is already offering discounts or rebates, or special lease deals in which price and other factors have already been set to make for an attractive monthly payment.

If you get price quotes from dealers in your area through car buying services such as Edmunds.com, those quotes will already include any available discounts and manufacturer incentives being offered at that time.


Negotiating Car Deals – Explained

negotiating a car dealMost of the kinds of car deals that we discuss on this web site don’t require negotiation because they are pre-packaged deals offered by car manufacturers, not dealers. They are usually genuinely good deals and better than any deal customers could negotiate on their own with a dealer.

However, these promotional incentive offers are limited to specific makes, models, and styles and are only good for a specific period of time, usually a month. Some manufacturers regularly offer such incentive deals; others do not.

So, what is the best way to negotiate great new-car deals when there are no incentives being offered?

1. Know your car and know your prices – do your homework first

Before you ever contact a car dealer, you should have already done your homework. Use the Internet to research the car you want, its options, color choices, features, and prices. Go to a dealer and test drive the car you like, but leave your checkbook at home. Use web sites such as Edmunds.com  to find special dealer prices and incentives. If you will be trading a car, use Edmunds or Kelley Blue Book web sites to get trade-in values. In order to intelligently negotiate prices, you have to know what you’re negotiating for. You have to know what are reasonable negotiation targets, not blindly “shooting in the dark.”


Best Car Deals with Poor Credit

bad credit car loanAutomotive customers who have poor credit are able to get car loans much easier now than in the last couple of years.

Many car companies and their associated finance companies are opening up and approving “subprime” borrowers at a pace not seen since before the recent recession.

Car buyers with credit scores below 680 are considered “subprime” and nearly always pay a higher interest rate than “prime” borrowers. However this is an improvement over the last three years when this class of borrowers were essentially shut out altogether.

Which car companies are most likely to approve customers with bad credit?

Hyundai/Kia leads the way in lending to customers with credit scores below 680. In fact, about a third of current Hyundai/Kia loans are made for such customers.

Fiat Chrysler Group (Chrysler, Dodge, Jeep, Fiat, Ram) is next. Then General Motors (Buick, Chevrolet, Cadillac, GMC) and Ford (Ford, Lincoln) follow closely behind. The conclusion to be made here is that people with less-than-perfect credit scores would have a better chance of getting approved for a loan with an American car maker than with most foreign brands. However, Toyota and Honda are showing signs of easing credit restrictions as well. (Source: Automotive News)

The best online source of car prices, deals, features and specs, safety and reliability ratings, professional reviews, and actual owner reviews is the highly respected Edmunds.com. And it’s all FREE.


Five Things to Know About Car Deals

best deals on carsFive important things to know about car deals

1. Dealers must make a profit and therefore can’t sell cars below their wholesale cost (invoice price) — except when the dealers’ car companies (manufacturers) sweeten deals on particular vehicles, with incentives such as rebates and bonuses. Since the incentive money doesn’t come from dealers’ pockets, dealers can sell cars for less than invoice price and still make a profit. Therefore, automotive consumers get the best car deals when there are manufacturer incentives on the vehicle they want to buy or lease. Without incentives, however, dealers shouldn’t be expected to sell at or below their cost.

2. Dealers make money many different ways other than straight profit on vehicle selling price. Customers often think they’ve gotten a great deal when, in fact, they haven’t. A dealer can get cash from his manufacturer in the form of hidden factory-to-dealer rebates, holdbacks, and bonuses for making sales goals — all of which adds to profit. Dealers also make profit from boosted loan interest rates (“reserve”) and unofficial fees, such as “documentation”fees. Most of these items are not negotiable since they are not listed on sales contracts. Dealers do not make profit on official fees such as environmental protection, tax, tag, and title charges. One of the sources of much dealer profit comes from the Finance Manager’s office when he sells extended warranties, service contracts, credit insurance, life insurance, security services, and paint/fabric protection. These items are high-profit sales for dealers but overpriced and often not needed by customers.


When a Good Car Deal is Not a Good Deal

good car dealsYou just got this great deal on a new Ford Explorer XLT for which you paid only $29,217!

The MSRP sticker price was $33,795, which means you got a savings of $4578.

Wow !!!

That’s 13.55% below MSRP! A great deal.

It’s even below dealer invoice price of $32,183.

However, when you went into the F&I (Finance and Insurance) Manager’s office to apply for your loan and sign the papers to conclude the deal, the deal began to fall apart.

Here’s how.

Not knowing that it’s the Finance Manager’s job to make additional profit for his car dealership, you fell for most of his attempts to sell you additional services and products, all of which erode your deal, make a lot of profit for the dealer, and don’t provide you good value in return.

Let’s take a look at what you bought and why you probably shouldn’t have.


0% APR Loan Deals – Good Deal or Not?

0-apr-dealsCar makers are offering 0% APR loans (zero percent interest) as incentives on many makes and models during these times of slow car sales. Sounds great. But is it really? Is it better to take cash back, if offered?

Let’s take an example in which you agree to buy a car and finance $15,000 for 48 months at 6.70% APR interest rate.  Your monthly payments will be $357.11 per month. The total of all your payments for the life of the loan will be $17, 141. This means you are paying $17,141 – $15,000 = $2141 in interest, or finance charges.

Now, if you find a 0% APR interest loan deal for the same car, same price, you would pay only $312.50 a month and save $2141 in total cost over the life of the loan. You would be paying no interest and every cent of your monthly payment would be applied to reducing your loan amount.

Not a bad deal, right? Right. But maybe not the best deal.

Most 0% APR deals also come with an alternative cash back rebate deal. Typically, you can take one or the other but not both. If you take the cash back rebate, you must finance your loan at normal interest rates.

But, remember, the amount of your loan is less if you accept the rebate, even though you pay a highr interest rate.

Is it better to take the 0% loan, or the cash rebate?

To find out, compare the savings of a 0% loan to a loan at normal interest rate that includes the rebate amount.

First, simply divide your loan amount by the number of months in your loan. This produces your 0% APR no-interest monthly payment.

Second, use an online auto loan calculator (http://leaseguide.com/car-loan-calculator) to calculate your monthly payment at the normal interest rate, after you subtract the amount of the rebate from your loan amount.

What is the difference in monthly payment amount?

In our example above for a $15,000 car, our payment with the 0% APR loan was $312.50.

Assuming the car maker is offering an alternative $2000 rebate, that would reduce the loan amount to $13,000. Calculating our monthly payment, we find that the payment would only be $309.49, which is less than the 0% APR deal.

In other words, accepting the rebate gives you a lower monthly payment than the 0% loan.

If the car manufacturer is offering more than $2000 rebate for this deal, it becomes even sweeter.

Generally speaking, it is nearly always better to accept a rebate than a 0% loan deal if you have that choice, and if the rebate is more than $2000. This is especially true if you are short on down payment money because the rebate acts as a down payment.

See the following article, Best Car Rebates, to find out which car brands and models have current rebate deals.

Credit is important

To get a 0% financing deal, a customer must have good credit, where there is no such requirement for a rebate. So, if you think you want to go with the 0% rate option be sure to check your current credit scores first.

What’s your FICO® Score? Find out now with a purchase of your Experian Credit Report for $1 with enrollment in Experian CreditWorksSM!

In summary, don’t automatically assume that a 0% APR deal is better than a rebate. In many cases it is not. Do your math before you decide and you may be surprised at the results.


How to Lower Your Car Insurance Cost

cheap auto insuranceAuto insurance is one of those necessary evils of owning and driving cars. Most states require at least some liability  insurance to protect other people in case you cause an accident. Although the laws don’t require you have collision or comprehensive coverage, most auto loan companies and banks do.

Keep in mind that car insurance costs can vary widely between insurance companies for the same car and same individual. And rates change frequently. The cheapest insurance company this year might not be the cheapest next year. The company that has the best rates for a young driver may not have the best rates for an older driver. The company that has the lowest rates in one city and state may not have the lowest rates in another city and state.

So how do find the cheapest auto insurance rates?

Simple. You ask for rates from a number of different companies, compare them, and go with the most affordable. Insurance quotes are free and there’s no obligation to accept any of them.  Then, in about a year, you do it again because rates can change in that timeframe.

Understand that auto insurance companies have a complicated risk-based system that determines rates. Rates are based on the age of the insured, his driving record, where he lives, where he drives, how much he drives, for what purpose he drives, the make/model/age of his vehicle, if he has other insurance with the same company, and his credit score. Yes, many insurance companies have determined that people with poor credit scores are more likely to submit car insurance claims, and therefore should pay higher insurance rates.

How much insurance should you buy?

Best Rates on Car Insurance – Explained

auto insurance ratesMost automotive consumers do at least some research before buying a new car — checking prices and incentives, looking at styles and options, comparing mileage and safety ratings, noting reliability scores and reading reviews.

But many fail to consider the cost of auto insurance as part of their buying decision when, in fact, the cost of insurance will often exceed the cost of gasoline and, in some cases actually be greater than car payments. Insurance is a major cost of car ownership, yet it’s often overlooked.

One of the major contributors to car insurance cost is the make and model of vehicle. Different vehicles have different insurance rates.

We know that more expensive vehicles have higher insurance rates simply because those vehicles cost more to replace and repair after accidents.  But rates can also be high for less expensive cars — because they are wrecked more often and have higher claim incidents — or are stolen more often.

Therefore, it makes good sense to research auto insurance rates before making a new-car buying decision. A great car deal can actually be not such a great deal when insurance is considered. Insurance can easily double the monthly cost of car ownership fors some car makes and models.

So, what are the vehicles with the cheapest insurance?

Industry sources recently published results of a study of average auto insurance rates for more than 750 vehicles. Following are some of the models with the lowest rates:


Lowest Insurance Rates Make Best Car Deals

auto insurance car dealsMany people buy new cars and only look at the price or monthly payment. However, overall cost of ownership also depends on other factors such as fuel economy, reliability (how frequently repairs are needed), cost of repairs, cost of scheduled maintenance, annual taxes — and auto insurance cost.

After monthly payments, auto insurance is the most costly ongoing expense of driving a car.

We all know that we are required to have auto insurance on our cars to comply with state financial responsibility laws and, if we have a loan or lease, to meet finance company requirements.

Insurance laws are in place to make sure we are financially able to pay for damages and injuries that we might cause in accidents for which we are at fault. Banks and finance companies want to make sure they get paid if you damage or destroy a car for which you have a loan or lease. Insurance protects us from financial disaster, even if we think we’ll never need it.

Since insurance is such a large part of the expense of driving a car, insurance rates can make the difference between a good car deal and not-so-good deal. Insurance rates on different automobile makes and models can vary by thousands of dollars. Ideally, we want to choose a car with not only a good price and monthly payment, but also a good low insurance rate.

So, what are the cars with the lowest auto insurance rates?


Auto Insurance Can Affect Your Car Deal

auto-insuranceMost new car buyers don’t think about the cost of auto insurance until after the purchase, which can often be a mistake.

As you may already know, the cost of car insurance can vary greatly between different car makes and models.  If you buy a car that has high insurance premiums, the total of your car payments and insurance payments may be much higher than you expected — maybe even more than you can afford.

Let’s say you got a great price on a brand new Subaru Impreza WRX and also got a nice low-interest loan to create low monthly payments. You then go to your auto insurance company and are startled to find out that insurance coverage on that particular vehicle is higher than just about any other vehicle you could have bought — particularly if you are a teen or young adult.

It’s true that the Subaru WRX is one of the most expensive vehicles to insure, along with other vehicles such as the Scion tC, Hyundai Tiburon, Honda Civic Si, Dodge Charger, and Nissan 350Z/370Z.

Do you see the similarity in the vehicles in this list of expensive-to-insure vehicles?

They are all small, high-performance coupes that are popular with young male drivers — who wreck them frequently. In fact, young male drivers who buy these vehicles can expect to pay outrageous insurance rates — because the risk of having an accident and filing an insurance claim is very high.

But what does that have to do with the cost of auto insurance for drivers who are older, and maybe not even the same gender, who buy these vehicles? Do we also have to pay higher rates?




Car Incentives Explained

new-car-incentivesSelling new cars is a very competitive business.

There are thousands of new-car dealers and there are a couple of dozen car companies who make thousands of makes/models/styles of cars. These companies are constantly competing for the business of car-buying customers.

One way they compete is by offering attractively designed vehicles that have the features, comfort, safety, performance, fuel-economy — and prices — that customers want. In many cases, price is the most important factor.

Although all new cars have a MSRP (Manufacturer’s Suggested Retail Price) on the legally-mandated window sticker, very few new cars actually sell for the window-sticker price. Most customers pay less.

How much less? See Edmunds for detailed pricing, including incentives, for all car makes and models. Get dealer price quotes so that  you how much less than sticker price you should expect to pay. In many cases, the price is less than a dealer’s factory invoice price.

How can a dealer stay in business by selling cars for less than sticker price?

First, the dealer typically has a potential profit margin of about 6%-8%. This is the difference between sticker price and invoice price, the price he pays when he buys the car from the manufacturer. Although a dealer must make some profit and pay for his own cost of doing business, he has some flexibility to reduce his profit margin and give customers a price discount. Often, the amount of the discount depends on the customer’s negotiating skills and price knowledge.


How to Get the Best Car Deals

Best car dealsOn this web site we write about promotional car deals and incentives being offered month to month by car companies and their dealers. The deals are usually well worth customers’ consideration and better than deals they could negotiate for themselves.

These deals come in the form of cash-back rebates, bonuses, low-interest loans, factory-to-dealer cash, and special lease deals and usually change from one month to the next. A particular vehicle may be a good deal one month and no deal the next.

The downside of this method of finding good car deals is that if you are looking for a certain vehicle make, model, and style (trimline), there might not be any incentives on it in the month that you would like to buy or lease. And there’s no way for you know to if there will be incentives offered if you wait a month or two, or ever.  Car companies rarely offer special deals on every model and trimline. Some hot selling vehicles may never get incentives.

So, how is it possible to get the best car deals when there are no manufacturer’s deals are being offered on the car you want at the time you want it?


Cheapest Cars – Best Deals

cheapest carsMany people who are looking for affordable new cars will find the lowest prices on smaller vehicles.

These are vehicles that offer a lot of value for the money, provide excellent gas mileage, and are cheap to insure. The lowest priced models are often base models and sacrifice engine size and expensive features. For a little more money, within the same model line, other styles are usually available with extra features and larger engines.

We list the 10 lowest priced cars below, along with the MSRP sticker price. However, we all know that buyers don’t pay full sticker price for most new cars. Therefore expect to pay less than the prices shown. How much less? Use Edmunds.com to see what dealers are offering and get lowest-price quotes from your area.

Furthermore, most of the cars listed below have incentives in the form of low-interest loans (some 0% APR), special lease deals, and rebates which further reduces the price you pay.

Let’s take a look at the 10 cheapest new cars:

2012 Nissan Versa 1.6 S – MSRP: $11,770 (currently has 0% APR loan rate for up to 60 months)

2012 Smart ForTwo Pure – MSRP: $13,240 (currently has $99/month lease deal, 36 months)

2012 Hyundai Accent GLS – MSRP: $13,320 (currently has 1.9% APR loan rate for up to 60 months or $169/month lease deal, 36 months)