A Car Purchasing Guide for U.S. Immigrants

In the market to buy a car but unsure how to start? 

You came to the right place!

In this complete guide, we’re going to quickly cover the fundamentals of car buying from beginning to end. 

Read on to start shopping with confidence. 

Key Terms to Know

Before we get started, let’s review the five key terms typically encountered in the car-buying process:

• Annual Percentage Rate (APR): The total cost paid each year to borrow money (including all associated fees and costs).
  
• Amount Financed: The total amount of money borrowed.
  
• Down Payment: The lump sum of money applied to the purchase of a car. The more money down, the less money the buyer needs to borrow. The average down payment on a new car loan is about 12%.
  
• Certified Pre-Owned (CPO): A comprehensive program offered by automakers that guarantees a used car has been carefully inspected, refurbished, and certified. CPOs typically include extended warranties for used vehicles.
  
• Warranty: A contract stating the manufacturer’s promise to cover the costs of any repairs needed on your vehicle. 

If you encounter confusing jargon along the way, be sure to check this glossary of car-buying terms.

Set a Budget

How much should you pay for a car? 

That all depends on your budget and preferred method of payment (i.e. if you’re planning on paying in cash or taking out a loan to either lease or finance your vehicle).

By setting a clear budget, you’ll quickly narrow down what kind of car you’re looking for, what you can afford to spend, and how you’ll pay for it. 

A car is a recurring expense, so don’t forget to include regular maintenance and gas costs in your budget. You should also be aware that the age, make, model, and mileage of your vehicle can also influence your car insurance premiums. 

If setting a budget sounds like you’re limiting your options, don’t worry. There are tens of thousands of great cars at even better prices that you can easily find online, as we’ll discuss below. 

2. New or Used?

There are numerous factors to consider when choosing whether to buy a new or a used car. If your budget alone doesn’t help clarify your decision, consider these other elements:

• • • History: Whereas a new car has no adverse history to investigate, a used car certainly does. While that’s not necessarily a bad thing, you will want to ensure the car is safe, reliable, and has no hidden flaws.
      
      Companies like Carfax can easily help consumers identify the true value (and reliability) of a used car.
    • Depreciation: While used cars are obviously older than the latest models, they don’t depreciate in value as rapidly as a new car. After all, as soon as you drive a new car off the lot, its value instantly drops about 10%. 

According to Edmunds, for example, a brand new Ford F-150 sells for $50,000 but loses $14,349 (28.6%) in value within a calendar year.  

Conversely, a one-year-old Ford F-150 costs roughly $35,805 and experiences relatively insignificant depreciation over subsequent years.

Therefore, if you sold your one-year-old pickup truck after three years of ownership, you could expect to earn about $32,000 on the sale, only slightly less than the value of a new F-150 just one year after purchase.

Depreciation is a natural phenomenon, but in light of its effects, used cars can seem especially appealing.

• • • Warranty: New cars typically include a warranty in the final sale price (which can and should be negotiated). The typical warranty covers 3 years/36,000 miles. In other words, the manufacturer will handle all repairs for the next three years or the first 36,000 miles of driving (whichever comes first).

Though used cars are typically more affordable, they may not necessarily include a warranty. If they do, double check to see what it covers and whether it’s backed by the manufacturer or the dealer. 

Generally speaking, be wary of purchasing any “as is” used cars, as you will be responsible for any and all repairs out-of-pocket (even if the car breaks down right outside the lot!). 

3. Where to Shop

It’s a great time to shop for cars. Not only are there many holiday sales events going on through the Summer and Fall months, but overall demand for cars has increased in 2021, driven by the pandemic. Never before have there been so many avenues available for consumers to compare vehicles and prices.

If you’re in the market for a new car, you can always head straight to the dealership, test drive to your heart’s content, and then place your order. 

Or, if you’re more interested in a used car, most franchised dealerships carry late-model vehicles with their original warranty (or CPOs with an extended warranty). 

If you’d prefer to stay at home while you search or your next used car, be sure to check out these great websites:

• • • Carvana: This seamless online service will deliver cars straight to your front door and give you seven days to test it out. If you don’t like the car, you can return it hassle free.
      Click here to check it out.
    • CarMax: This large chain features countless cars from used-car dealerships across the country.
      When shoppers find a car they like, they can request to have it transferred nearby (no matter where the car is located). From there, you’ll have 24 hours to test drive it and 30 days to return it.
      Click here to learn more.
    • Autolist: This website aggregates dozens of used car apps and websites on the internet. That makes it a highly efficient way to find the absolute best deals available.
      Click here to start your search!

Getting Started

Car buying can be complicated, but at uLink, we put simplicity first. 

Thanks to our uLink Money Transfer app, you can skip the long wait times and hidden fees and send money home fast. With our increasingly global network, you can send money to over 143,000 locations in 51 countries. 

And with our great exchange rates and fees starting as low as $0, you can send more money home than ever before. 

Plus, after your 1st, 2nd, and 5th transactions, we’ll send you a $10 gift card to use at your favorite retailers. That’s $30 in gift cards after your first five transactions with uLink. 

Miles from home — just moments away with uLink. 

Send Money Now!

 

Certified Pre-Owned (CPO): A comprehensive program offered by automakers that guarantees a used car has been carefully inspected, refurbished, and certified. CPOs typically include extended warranties for used vehicles.