New vehicle prices remain high, causing many shoppers to seek ways to stretch their car-buying dollars. The experts at Edmunds offer strategies to reduce your next vehicle purchase’s cost.
Consider a Used Vehicle
Opting for a used vehicle is a simple method to extend your budget. While new cars provide the latest features and warranties, their prices are significantly higher. You can find greater value in the used market. Vehicles only a few years old can offer similar features as new models without the steep depreciation. In June 2026, Edmunds data showed the average price of a 3-year-old used vehicle was $32,553 compared to $48,899 for a new one.
Expand Your Search Area and Loan Options
Don’t limit your search to nearby dealerships. Traveling further from home may reveal a wider selection and better prices due to varying local demand and supply. Loan options are equally important. Waiting for dealership offers might not yield the best rates. A credit union often offers better rates than dealership partner banks. Secure a preapproval from your bank, credit union, or online lender. Compare against dealer offers. According to the Consumer Financial Protection Bureau, comparison shopping can save thousands on loan costs.
Maximize Your Current Car’s Trade-In Value
Your current vehicle might be worth more than expected. Boosting its value reduces financing needs. Obtain multiple trade-in offers before visiting a dealership. Use online appraisal tools and used vehicle retailers for baseline estimates. Several offers enhance negotiation power and help avoid low values. Consider private-party sales; though more effort is needed, returns are higher than trade-ins. Buyers should prepare by gathering maintenance records, cleaning thoroughly, and fixing minor cosmetic issues.
Focus on Total Cost, Not Monthly Payment
Salespeople may ask about comfortable monthly payments, causing distractions. While lowering monthly payments is tempting, it can lead to longer loans with higher overall costs due to interest. Evaluate the full financing package, including down payment, trade-in, interest rate, loan term, and total cost. Shorter loans with slightly higher monthly payments save money in interest. Compare offers based on this overall cost for a clear understanding.
Protect Against Negative Equity
Due to pandemic-inflated prices and longer loan terms, negative equity risk has risen. Edmunds data indicates 30.9% of trade-ins for new purchases had negative equity early in 2026. Transferring negative equity to new loans raises amounts and complicates building equity in replacement vehicles. Wait to make 10% to 15% down payments. If you owe more than your car’s value, keep it longer and pay down the balance before trading. This strategy prevents continuous debt cycles.
Edmunds advises examining more than the sticker price. Request detailed fee breakdowns before signing. If unfamiliar fees or services appear, ask the salesperson to avoid costly surprises.
Josh Jacquot is a contributor at Edmunds. This story was provided to The Associated Press by the automotive website Edmunds.
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