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Chapter 28 Cars & the Consumer

Chapter 28 Cars & the Consumer. What should you look for?. Safety Insurance Institute for Highway Safety Price Edmunds, Kelly Blue Book, NADA, Carfax All cars have a VIN (Vehicle Identification Number) Quality Consumer Reports Warranty What does it cover? Bumper-to-bumper?

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Chapter 28 Cars & the Consumer

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  1. Chapter 28Cars &the Consumer

  2. What should you look for? • Safety • Insurance Institute for Highway Safety • Price • Edmunds, Kelly Blue Book, NADA, • Carfax • All cars have a VIN (Vehicle Identification Number) • Quality • Consumer Reports • Warranty • What does it cover? • Bumper-to-bumper? • Powertrain? • Sex appeal Fuel Economy • Fueleconomy.gov

  3. What to expect • Federal law requires that all dealerships provide a pamphlet with their cars to detail safety features of cars • No one pays (or should pay) the sticker price for a car • Rebates • Incentives • Cool stuff in the car • Discounts • Haggling • The Federal Trade Commission requires that all used car dealers place a “Buyer’s Guide” sticker in the car’s window • Does the car come with a warranty? • If not, it must be listed as “As-is. No warranty” • Before you buy a car, you should have a mechanic you trust to look at the car. • If the dealer is weary of allowing you to do this, DON’T BUY FROM THEM • Car warranties are important and you must keep up with scheduled maintenance to keep it valid

  4. Financing • Unless you have the money with you at the time of purchase, you must get your car financed • You do NOT have to purchase financing from the dealer you buy the car from • Car dealerships make a ton of money off of this • Go to a bank first to get your financing • The type of loan (i.e. how good is it) is determined by • The type of car you are loaning • Interest rates are usually lower on new cars • Your FICO score • You get loans from • Banks • Finance Companies (i.e. Quicken Loans Arena) • Credit Unions • Two important things to consider for a loan • APR • Duration of the loan • NEVER TELL A CAR SALESPERSON HOW MUCH YOU CAN AFFORD A MONTH • Your concern is a bottom-line price • What the cost of the car is

  5. Insurance is also a key • When you buy a car, how much your insurance is should play a huge role in the decision to buy • Everything from the color of the car, to the make and model year, to the safety/anti-theft features play a role in the price • Before you buy a car, call your insurance agent with the VIN to get a good estimate as to what you will pay

  6. Leasing • It’s like renting a car. . .for 2-4 years • You have monthly payments • You also have a yearly mileage requirement • Issues of wear and tear become key • Lease or buy? • Why lease? • Upfront costs are low • You get a new car every few years • Why NOT lease • If you drive a lot, it could be a problem • You always have a car payment

  7. Housing and the Consumer C 2H 9Apter

  8. Housing • A mortgage is a home loan • The bank owns the deed (legal receipt) of the house • Usually a 15-30 year mortgage • Tenants (renter) pays the landlord (owner)

  9. Leasing • Contract to rent • Specifies the amount to be paid • Specifies the term • You should inspect the property before you rent • You should also check the contract you are signing • A lease application must be filled out • Name, age, address, place of employment, source of income and previous residences • This is where they check your credit

  10. Types of leases • Month-to-month leases are for people who plan on living in a certain area for a short period of time • Almost always more expensive • Tenancy at will • Tenant moves in with the understanding that the lease is for an indefinite period of time • Tenant can leave at any time • Tenancy for years • Lease is 6 months to a year • In this way, the tenant and the landlord are protected

  11. Negotiations with landlords • Knowing the area you will be in really helps out • If there is a high supply of places to rent, but a low demand, the renter is in a good position • If there is a high demand and a low supply, the landlord has the advantage • When you sign a standard lease, the landlord is at an advantage • Pay your rent, or get evicted • Make sure you get the payment date in writing • Generally, landlords cannot raise rent during the term of the lease. . .however • Sometimes leasing contracts have provisions to raise the rent due to variable costs • i.e. utilities or other maintenance fees • Rent controlled apartments • Law limiting the amount of rent you put on a property

  12. Keep it up • Most states make laws requiring landlords to maintain properties to basic living standards • Warranty of habitability • Landlord promises to provide a place that is fit for human habitation • Housing codes are minimum standards needed to be upheld for living standards • Tenants must notify the landlord when repairs are due • A residence is a residence • You can’t use it as a business • “Zoned” for business purposes • Leases can specify the maximum number of tenants allowed • Leases can also specify what is to be done if there are damages to an apartment • If damages are committed, it is known as waste

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