Okay, so it's fun to have a new car.  Showing off a flashy new automobile or simply having a more reliable vehicle to get you to and from work can make a big difference in life.  After all, driving is fun when you don't have to be concerned about car repairs every few miles.  But buying a car is major purchase and there are several pitfalls that you will want to avoid.

Most of us don't have several thousand dollars lying around for the purchase of a car, new or used.  That means that most of the time people will be looking for some type of loan in order to drive off in their newest possession.  This where things can get a little complicated.  While there are plenty of good car salespeople who have integrity, there are also those that see an opportunity to scam people who are looking for a way to purchase their new car.

As a general rule, to protect yourself from financing scams, if you have bad credit you should not plan to finance your car at the dealership.  If your credit score is below 680 you are better off going to a bank, rather than trying to get financed through the dealership.  Many car dealers will promise to finance you no matter what your credit is, but they aren't a lending institution. What's more, some car dealers will look for ways to increase your payments by readjusting your interest rate.  Remember that you never want to sign on the dotted line for a loan that is based on monthly payments.  You should always finance based on the actual price of the car.  And never take the car until the loan has been approved in writing, no matter what the dealership says.  Until the loan is finalized by the actual lending institution the car dealership can make changes to it based on the fine print.