Car Shopping and Coronavirus
On March 13, President Trump declared a state of emergency due to the coronavirus. Now, self-quarantines have been extended to the end of April. Schools are closed and offices are shut down. In most areas of the country, it’s ill-advised to grocery shop more often than once a week. It’s also recommended that you practice social distancing, which means keeping six feet away from others at all times, at the very least. Avoid socializing if you can, they say.
Yes, this is really happening, but what about your car?
It doesn’t seem like the best time to go car shopping, but car troubles don’t make appointments to take place when it’s a convenient time. So, what should you expect if you’re forced to buy a car right now? And for those of you who were considering buying a new car before the COVID-19 pandemic struck, is it a bad idea to keep looking?
There are some silver linings to the coronavirus pandemic. For instance, many carmakers are offering zero or low interest rates after announcing plans to close plants if they have not already done so. You should expect some shortages now that some car manufacturers are looking for ways to help produce essential medical equipment, like respirators. But if you find a car you want, you may be able to buy it cheap.
Carmakers Want You to Buy Now
Car manufacturers are busy creating programs designed to encourage car buying. Not only are carmakers trying to make sales, they are also helping support the buyers who are having trouble making car payments during this uncertain time.
With that said, they are also beginning to close down plants to protect employees. Also, demand has dropped dramatically ever since everyone hunkered down in their homes. Fewer cars are being made for these reasons and because manufacturers are trying to put their efforts into making respirators for coronavirus patients.
The list of jurisdictions calling for the stay-in-place order is also rapidly growing, so it’s important to begin by seeing what the ruling is in your area if you’re looking to buy a car right now. In one jurisdiction, car dealerships are open but in another, they are forbidden to close sales. In some states, car dealerships are closed entirely because they are declared non-essential businesses. The dealerships that open may be limiting their hours and interactions due to the shelter-in-place orders. Some will only show you around if you make an appointment. It really varies by city and state, so make some calls before you go. You can also consider buying a car online.
Is it a Bad Idea to Buy a Car During the Coronavirus Pandemic?
You should not avoid buying a car because of the coronavirus. However, you should buy a car that you can afford. If you’ve just lost your job and can wait it out, that may be a wise consideration. If you’re lucky enough to still have a job that feels secure, you may find some great deals.
How Can I Shop for a Car During Coronavirus?
When shopping for a vehicle, you should be practicing what medical authorities suggest you do during and after a person-to-person meeting: Keep at least 6 feet away from the car dealer (or private owner), avoid shaking hands/touching, wash your hands for at least 20 seconds afterwards or use a high-alcohol-content hand sanitizer. It’s also a good idea to change your clothing after test-driving a car and wash those clothes before wearing them again.
If you are immunocompromised or in a high-risk category, you may want to consider whether or not it’s a good idea to be car shopping right now.
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When’s the Best Time to Buy a Car?
Most car deals are announced at the beginning of each month. By April 1, you will know what carmakers are offering as financing and lease incentives. Many of them are sure to offer zero percent financing. Some automakers are offering payment deferral programs so that you do not have to start making payments until a few months after you buy. Even then, you should compare different dealerships’ pricing to make sure you’re getting the best deal available.
If you’re healthy, still have a job and you need a car, it’s a good time because automakers will be offering especially good deals to bolster sales during the coronavirus pandemic. However, if you just lost your job and have no other choice than to buy a car, it’s a better idea to finance a car with delayed payments rather than lease a car. If you do not make payments on a leased vehicle, you’ll be penalized but if you finance a car while you’re unemployed and still don’t have a job by the time payments kick in, you can at least sell the car! You can’t sell a leased vehicle. You may be able to find someone to take over the lease. However, for more on leasing versus financing a car check out our page.
Is Buying a Used Car During the Coronavirus Pandemic a Bad Idea?
If you’re looking to buy a used car, you may save some money. If you absolutely need a car and you’re out of a job, it may be the best option for you. With fewer willing shoppers, you may be able to haggle for a lower price too. Used cars sold by private sellers are often less expensive than used cars in a dealership but you won’t get a warranty.
Just as you would when visiting a dealership, take precautionary steps if you buy from an owner, such as not shaking hands, keeping a distance (or wear a mask if you’re test driving with the owner) wearing gloves when test driving and avoiding touching your face until after you’ve washed your hands.
Will There Be a Shortage of Cars Because of Coronavirus?
There will likely be a shortage of some cars and some excellent deals on others. It’ll be a mixed bag and it’ll vary from one dealer to another and one carmaker to another. If dealerships remain open in your area, traffic will likely be light due to the COVID-19 pandemic. Some of the carmakers offering big incentives include Ford, General Motors, Fiat Chrysler and Hyundai. You may, however, not be able to find the car you were looking to purchase before the pandemic due to plant closures and carmaker’s anticipation of a halt in sales.
How Should I Shop for a Car?
Shopping for a car now is no different from shopping for a car before the pandemic. You’ll want to search and compare widely and get prices from several dealerships and private owners. You’ll also want to negotiate the price, avoid options that may break your budget and consider the incentives that are available to you.
What You Should Know About Coronavirus and Car Loan Interest Rates
The U.S. Federal Reserve has reduced a key benchmark interest rate to zero in order to support our crippled economy. This move is intended to encourage lending and get consumers to spend so that the economy stabilizes.
Different lenders will offer you different interest rates so it’s important to shop around to see what different car loan lenders are offering versus what the manufacturer is offering before you choose your car loan.
What You Should Know About Insuring a Car
Shopping intelligently for car insurance can mean a savings of hundreds, sometimes thousands, of dollars a year. Just as you would when you shop for a car, you should shop around for the best car insurance rate.
However, it takes hours to call dozens of car insurers for auto quotes. SmartFinancial will compare car insurance rates for you, after you fill out some questions about your car. They will then put you in touch with an agent who most closely matches your needs. Just fill out your zipcode below.
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