( continues...) to drop the purchase price of the vehicle by the same amount. There are calculators out there that can tell you what your monthly payment will be based on the purchase price and interest rate. I believe Capital One's calculator will also calculate tax and typical reg and title fees as well. This will help you to figure out what you can afford for the loan length you desire.

Dealerships love to sell you on a monthly payment, but what they fail to highlight is that the lower monthly payment comes at the cost of a longer loan term, which means you pay more in interest. A longer term also puts you at greater risk that you'll be upside down on the car, which means the car is worth less than you owe. If something happens, you'll be responsible for the difference (can be thousands of dollars). If you're going for pre-approval, ask your financial institution if they include gap insurance which will cover you in that situation. If they don't, ask your auto insurer. Gap insurance from the dealership is usually overpriced.

Also ask to see any invoices from the work the did to get the car in saleable condition. If they put 4 new tires and both sets of brakes on the vehicle, the higher price they're asking may be justified. Also ask to see the safety inspection results. This will tell you how soon you may need to repair components in order to pass inspection in the future.

Once you've negotiated a price and you're ready to close the deal, you'll be taken to the finance manager who will try to convince you to buy all kinds of unnecessary goodies. Most of this is pure profit. Don't buy any kind of fabric protection, tire insurance or the like. Just say no. The extended warranty *may* be worthwhile, but ask to see the specifics before you agree. Many extended warranties only cover limited components and aren't worth squat. If it's comprehensive, then it's worth discussing. Always ask for a discount off of the price they quote. If they don't give you one, don't buy it. You can find aftermarket warranties on your own, but note you'll have to pay for those upfront instead of rolling them into your car loan. Even at the no-haggle dealerships, the cost of the extras can often be negotiated.

Will car dealerships take a big chunk of cash and then finance the rest? Or is it a situation of, if it's legal tender they'll do whatever it takes to get it?

Connie, the dealerships will take whatever downpayment you have and finance the rest. Often, if you have a large downpayment, the interest rate will be lower because you have more skin in the game. A larger downpayment can also avoid the upside down issue.

Dealerships will do just about anything to make a sale, but don't expect them to lose money on the deal. If they're selling the car for $10,000, and it's worth $9500, don't offer them $8000 just because you have it in cash. They won't bite. They're entitled to make money--expenses were incurred in prepping the vehicle for sale, there's overhead, they have to pay the salesperson commission,and it's not unreasonable to try and make a small profit.

If you're uncomfortable at any point, walk away. Once you sign the contract, it's done. There's no reconsideration period. There will be another car that meets your needs.

I'm happy to help once you get to the point of actually buying. Email addy in profile is good.

And get or ask for a carfax. That will tell you if the car has been in any major accidents, and how many owners it had. Stay away from cars that have major accident damage. They're never the same after being repaired.

One of my friends bought her smartcar while home for Christmas in Cleveland because it was so much cheaper there than here that it was worth paying for it to be shipped out here. Because no one in Cleveland wanted a used smartcar, but here they're popular.

That was amazing, Maria, and I don't ever intend to own a car!

My feeling is buy Hondas and Toyotas new, buy domestic cars used, and don't buy European cars. IME, at least in the Midwest, there is a massive premium on used Hondas and Toyotas while Fords and GM fleets get sold off here and are pretty cheap. That may be different on the coasts.

there is a massive premium on used Hondas and Toyotas

There is a v good reason for that, me thinks.

meara,exactly. It's why msbelle will probably get a great deal on a hybrid car in Texas, but would pay out the ass for it in Seattle.

Thanks, Jesse!

My feeling is buy Hondas and Toyotas new, buy domestic cars used, and don't buy European cars. IME, at least in the Midwest, there is a massive premium on used Hondas and Toyotas while Fords and GM fleets get sold off here and are pretty cheap. That may be different on the coasts.

I'd flip the new and used portion, depending on where you are. Domestic manufacturers have better incentives than Honda and Toyota, which makes the acquisition costs of a new vehicle cheaper. Honda does not play in the fleet market at all, while Toyota has a fairly robust fleet department. Fleet/rental sales depress the residual values, which makes for a cheaper used car. It's a very delicate balancing act for the OEMs when allocating cars to fleet vs. retail.

Imports tend to do better on the coasts. Pickup trucks are king in Texas and Oklahoma. I wouldn't put a blanket ban on European cars--late-model Audis are holding up very well, and BMW is a lot better than they used to be. Mercedes is still a money pit. VW could be a great bargain in light of the emissions scandal, but perception matters to a lot of people.

Sedans are fairly cheap in Utah because of the big families. Once you get past two small kids, you're going to need something bigger, and wrangling youngsters needs better space than even a four-door. There are several 2-3 year old Imprezas on lots around my town currently.

We chose a 2014 Toyota Rav4 over a 2015 Subaru Crosstrek purely because of M's size, but both were pretty awesome & comfortable. Compact enough for me to feel comfortable driving in SF, but big enough that we can go up to Tahoe & not feel cramped.

I pine for an earlier CRV or RAV4 sometimes, because dogs (or one of the pre-enormous Outbacks), but we're in no position to replace our dog car (a 1988 Volvo on a rebuilt title with over 300k on it that we got for $800 cash) at the moment.

We've had good luck with Hondas, for the most part. Our Civic (bought new w/Previous Employer discount stuff--we shopped around for months getting that) is a decade old now and has been very reliable.

My Mini gets driven rarely but seems to be holding up okay at almost five. (It's one I'd strongly recommend buying new for anyone looking into a Mini because the used ones still sell for more than you'd think.) When I'm working again and we have any sort of financial stability, it'll probably get sold or traded in.

But Hondas are great. I find them nicer to drive than Toyotas at about the same price point with better fit and finish.