With new vehicle prices at near record highs, many shoppers are seeking ways to maximize their car-buying dollars. Edmunds’ car experts offer five strategies to reduce overall costs in your next vehicle purchase.
Consider a Used Vehicle
Expanding your search to include used vehicles can significantly stretch your budget. While new cars offer the latest features and warranties, they come with higher prices. Used cars, particularly those a few years old, often provide excellent value and many contemporary features. Edmunds transaction data indicates that the average price for 3-year-old used vehicles was $32,553 in June 2026, compared to $48,899 for new vehicles.
Expand Your Search Area and Loan Options
Restricting your search to nearby dealerships limits your options. Traveling further might reveal a broader inventory and competitive pricing due to fluctuating local demand and supply. Similarly, do not wait to consider your loan options until you are in the dealership finance office. Unless the dealership offers promotional interest rates, credit unions often provide better rates than banks partnered with dealerships. Preapproval from a bank, credit union, or online lender can usually beat dealer offers. The Consumer Financial Protection Bureau suggests that loan comparison shopping might save thousands over a loan’s life.
Maximize Trade-In Value from Your Current Car
Your vehicle might be worth more than you realize. Securing multiple trade-in offers before visiting a dealership can aid negotiations. Online appraisal tools and used vehicle retailers can estimate market value. Private-party sales, while time-consuming, often result in higher returns than trade-ins. Preparing your vehicle with thorough cleaning and minor repairs can enhance its value perception.
Focus on Total Cost, Not Monthly Payment
Don’t let monthly payment discussions distract you from understanding the total financing package. While smaller monthly payments may be attractive, they often mean longer loans, higher interest, and increased total costs. Consider the complete financing offer, including down payments, trade-ins, interest rates, loan terms, and overall costs. Shorter loans with slightly higher monthly payments can save substantial interest in the long run.
Protect Yourself from Negative Equity
Pandemic-based inflated car prices and longer loan terms have increased negative equity risks, where borrowers owe more than the vehicle’s worth. Edmunds data shows 30.9% of trade-ins toward new vehicle purchases had negative equity early in 2026. Rolling negative equity into new loans increases the loan amount and makes equity building harder. Edmunds recommends waiting to make a 10% to 15% down payment. Keeping your current car longer and paying down the balance avoids a debt-carrying cycle.
Edmunds Advice
Savings in 2026 require looking beyond the sticker price. Before completing any paperwork, request a breakdown of all fees. Ask the salesperson about unfamiliar fees or services to avoid costly oversights.
This article is provided to The Associated Press by Edmunds. Josh Jacquot is an Edmunds contributor.