Blog - Russo Auto Sales

How Much Can You Afford to Spend on a Car? 2017-08-16

Originally posted by Consumer Reports from www.consumerreports.org

Know your financial health before setting sights on a new car you can't afford

If you don't have a clear picture of how much you can actually afford, it's all too easy to bite off more than you can chew getting behind the wheel of a new car. Many people fall in love with a dream car and enter a state of denial when it comes to the math. Or they let themselves be lulled by a friendly salesperson into buying more options than they need or extra-cost items they can do without, like an extended warranty service contract.

Affordability, of course, means different things to different people, and usually hinges on both household income and existing obligations.

At the same time, this is a good opportunity to shop around for money. Interest rates are still lower than they were 10 years ago, and lenders have loosened up their credit requirements in the past two or three years.

Below, we provide insights and strategies for getting the most car for your money. We'll tell you how to estimate what you can afford, and how and where to shop for the most favorable loan rates.

What's Your Budget?

Take an honest look at your current finances. The fancy word for this is doing a "cash flow analysis," but it's really just a monthly budget. See how much you currently spend on essentials like mortgage or rent, utilities, food, and clothing. Add other monthly payments, such as student loans, homeowners insurance, cell phone, internet, and cable TV. Don't forget to include local taxes, if any, not deducted from your paycheck. It's important to leave yourself a decent cushion for entertainment, vacations, emergencies, and retirement savings.

Now look over your bank and credit card statements for the last two years. This should give you a solid idea of where all the money goes. You may find places where you can cut back, or you may already be running pretty lean.

Years ago there was a common rule of thumb called the 20/4/10 rule that was used to estimate auto-ownership affordability. That means making a 20 percent down payment, taking out a four-year loan, and devoting no more than 10 percent of your gross income each year to the loan, including car insurance.

In current times that guidance just doesn't work for people. New-car prices are too high for a three- or four-year loan, and incomes are stretched too thin. As a result, car buyers are taking out longer and longer loans to keep the monthly payment bearable. The average term is now 68 months (5 1?2 years), according to Experian Automotive, the market-analysis arm of the Experian credit-reporting agency. Scary fact: 28 percent of all new loans run from about six to seven years.

Super-long loans are not a great idea, even if it seems a lot of people are doing it. Unless you can come up with a really large down payment, you will owe more than the car is worth for many years to come. Lenders call the period where you owe more than the car's value "being upside down."

If you have to sell the car or if it gets totaled before you reach the break-even point, you'll wind up making continuing payments on a car you no longer own. The extra years of payments also mean extra years of interest, and that can really add up.

Many people trade in a car they still owe money on. A dealer who arranges financing then rolls whatever is due on the old loan into the new loan. This may look like an attractive proposition if you can't pay off your old car before selling it.

But beware. In essence you'll be paying off the balance due on the old car for the entire term of the new loan. And that balance due will be affected by whatever the dealer offers as a trade-in allowance. If the dealer gives you a lowball trade-in allowance, you could be upside down for a long time.

Price Your New Car Insurance

Your cash-flow analysis will tell you how much you have left over to devote to car ownership each month. Your monthly loan payment has to be considerably less than that so that you can also cover costs such as fuel, maintenance, and insurance.

Once you have a candidate car in mind and know its approximate price, call your insurance agent to ask what it would cost to add it to your policy.

If you've been driving an old car up to now, you might be surprised at how much your rates may rise. Obviously it costs more to insure a car valued at $30,000 than one valued at $10,000. Though you might have dropped collision coverage on your old car to save money, you'll want that coverage on the new one. Plus, it's also required by the financing company if you have a loan or a lease on the vehicle.

Your Monthly Payment

As far as car selection is concerned, the point of the budgeting exercise is to determine the highest monthly payment you are comfortable with. That is information you keep to yourself when negotiating with a car salesman, however.

Why keep that information close to the vest? Because the moment a car salesman discovers the highest monthly payment you can bear is the moment he can structure a deal that will use every bit of it, and possibly put you into the most expensive car he can. The easiest way for him to do that is to stretch out the loan. That also gives a dealer who arranges financing the ability to build in a higher than necessary interest rate without you realizing it.

Making a sober assessment of what you can comfortably afford might tell you that you shouldn't buy the car you had your heart set on right now. Then you might either consider a cheaper car (perhaps even a comparable used car) or postpone the purchase until you can save up a larger down payment. Another option is leasing.

Test-Driving Monthly Payments

How much car will a given monthly payment buy? Numerous online loan calculators can help you do the math. One that's especially easy to use is the affordability calculator at Cars.com, but there are many others. Among other things, they let you plug in a monthly payment of your choice, along with other assumptions, and see the total price of the car that payment will finance. 

How Much Car for a Monthly Payment?

When you're buying a car, the dealer will often try to get you to fixate on how much you can afford in monthly payments. He'll then structure the deal to give you the most car for the lowest monthly payment. Sounds great, right? It isn't. Sure, the longer the loan, the less you'll pay each month. But you'll actually end up paying more for the car in the long run, because you'll be paying more in interest payments. This table calculates how much you will have to pay each month for a vehicle, assuming an annual interest rate of 3.5 percent. Buyers paying off their vehicle in four years pay 6.8 percent of payments in interest. Those taking five years have 8.4 percent of their payments going to interest. 

And those taking six years have a whopping 10 percent of payments going to interest.

Auto Loan Amount
     48 Months
     60 Months
     72 Months
$15,000
     $335
     $273
     $231
$25,000
     $558
     $455
     $385
$35,000
     $782
     $637
     $540
$45,000
     $1,006
     $819
     $694


How Much Can You Afford to Spend on a Car? - Link to original story





Tire Safety and Maintenance 2017-08-10

Originally posted on www.exchange.aaa.com

Tire Safety and Maintenance

Understanding Your Vehicle's Tires

Your tires are the only part of the car that has direct contact with the road. Tires affect your vehicle handling, ride, braking, and safety. For optimum performance, tires must have the correct air pressure, tread depth, balance and the wheels of the vehicle must be properly aligned.

Checking your tires on a regular basis is an important step in protecting your safety and your automotive investment. Ideally, tire inspections should be performed monthly. If you drive over potholes and debris in the road, live in a cold climate, or drive long distances regularly, then you should inspect your tires more often.

Always inspect your tires before a long trip. The more often these inspections are performed, the easier it will be to find a small problem, such as a nail in your tire, and fix it before it becomes a more expensive and time-consuming issue.

Signs of Tire Wear

Poor tire maintenance can lead to premature tire wear, a flat tire or even a blowout. Factors other than tires themselves also can affect tire wear. Worn suspension parts and wheel alignment both play a direct role in tire wear and performance.

Tire Problems to Look For During a Visual Inspection

  • Over inflation: Too much air pressure causes mostly the tire's middle section to contact the road. This creates wear primarily in the center of the tread, with less wear at the tire's edges.
  • Under inflation: Too little air pressure causes mostly the tire's outer edges to contact the road. This creates wear primarily on both edges of the tire tread, with less wear in the center.
  • Tread wear on one edge of the tire: This typically occurs when the wheels are out of alignment.
  • Erratic tread wear: This is often called cupping, and may mean the wheel is out of balance, or that the shock absorbers or other suspension components need to be replaced.
  • Raised portion of the tread or sidewall: May indicate that one of the belts in the tire carcass has separated from those next to it.

Tire Problems to Look for While Driving

  • Unusual vibration or thumping noise: Vibration or thumping noises can indicate an out-of-balance tire, one with tread that has a flat spot due to locking the wheels in a panic stop, or a tire with a separated belt.
  • A pull to one side: While driving at a steady speed, pulling to one side may indicate an underinflated or damaged tire on the side of the car to which the vehicle pulls. If this is not the case, a brake problem or poor wheel alignment may be causing the pull.

Tire Tread Inspection

Tires depend on good tread condition depth to maintain traction and to shed water on wet roads. The tread should be checked at least once a month for excessive and uneven wear. The most accurate tread depth measurements are made with a simple tread depth gauge available at any parts store. Or you can use the traditional quarter and penny tests.

Insert a quarter into a tread groove with the top of Washington's head facing down. If the top of his head is not visible, your tires have at least 4/32" of tread and are fine for continued use. If you can see above the top of Washington's head, it is time to start shopping for new tires. Take measurements in three locations across the tire's tread: (1)outer edge, (2) center, and (3) inside edge.

The penny test is done in the same way, except that if you can see above the top of Lincoln's head your tires have less than 2/32" of tread, which is below the legal minimum and cause for immediate replacement. Tires worn to this level will also have visible wear indicators (thin bald strips) running from side to side across two or more tread segments.

The difference between 4/32" and 2/32" of tread depth might not seem like much, but based on research by the Tire Rack, America's largest independent tire tester the difference is significant. For example, a pickup truck traveling at 70 miles per hour that passes the penny test can take up to 499.5 feet to stop on wet pavement . However, the same truck has a stopping distance 122 feet shorter if it passes the quarter test instead. This is a 24 percent difference in stopping distance, and the equivalent of six or more car lengths.

The Tire Rack also reported that tires passing the quarter test exhibited better grip on the road under other driving conditions as well. Given these facts, AAA suggests you put that penny back in your piggy bank and instead use a quarter to check tire wear and determine when it is time for replacement. 

Tire Inflation Inspection

Keeping your tires properly inflated is one of the easiest ways to help maintain good gas mileage and extend the life of your tires. Check your car's tire pressure at least once a month with a quality gauge, that measures pressure in pounds-per square inch (psi). Three types of tire pressure gauges are available at most auto parts stores: digital, dial and pen/stick types. The digital and dial designs tend to be more accurate and easier to read, although a good pen/stick gauge will do the job as well. Pressure gauges built into air hoses at gas stations are often abused and frequently inaccurate.

Recommended tire pressures are for cold tires. Therefore, tire pressure should be checked at ambient temperature before the vehicle has been driven. Checking tire pressure on a car that has warm tires can result in a pressure reading of up to 5 psi higher than the recommended pressure. The recommended inflation pressures for your car's tires can be found in the vehicle's owner's manual or on the tire information decal attached to the driver's door jamb. On older cars the decal may be in the glove box or inside the fuel filler door.

Checking Air Pressure

1. Remove the tire's valve cap.

2. Place the gauge over the tire's valve stem and press firmly so that no escaping air is heard. The tire gauge will indicate how much pressure is in the tire.

3. Adjust the tire's air pressure as needed. When adding air, push the air hose into the valve firmly, until the air stops escaping. Check the pressure every few seconds to help judge the amount of air going into the tire, until you reach the recommended air pressure. If the tire's pressure is greater than it should be, use the nipple on the tire gauge to press the center of the tire valve stem and release air.

4. Replace the valve cap.

5. Repeat the process for the other tires. Don't forget the spare tire.

Tire Maintenance

There are several tire maintenance procedures that automotive repair professionals should do because they require special tools and knowledge. However, understanding these procedures will help you feel more confident in dealing with a repair provider.

Tire Rotation

Tires on the front and the rear of vehicles operate at different loads and perform different steering and braking functions, resulting in unequal wear patterns. To gain maximum life and performance from your tires, it is essential to rotate your vehicle's tires. Refer to your vehicle's owner's manual for mileage recommendations. Usually tire rotation is performed between 5,000 and 7,000 miles. Common on performance cars are tires designed to rotate in a specific direction; these can only be rotated front-to-rear, and if different tire sizes are used on the front and rear axles rotation is not possible.

Tire Balancing

Properly balanced tires help minimize uneven wear and extend their life. When tires are balanced, small weights are attached to the wheels to limit vibration of the tire and wheels as they turn. Newly installed tires should be balanced, and thereafter whenever a vibration is noticed. Balancing is also called for whenever a tire is removed from the wheel, for example to repair a puncture.

Wheel Alignment

Wheel alignment is the measurement of the position of the wheels compared to specifications that the vehicle manufacturers recommend. Each vehicle has specific wheel alignment settings. If any alignment measurement falls outside the specified range, uneven tire wear can result, vehicle handling may be affected and fuel economy can be diminished.

You should have the wheel alignment checked and adjusted when new tires are installed, and thereafter any time when unusual steering characteristics are observed. A vehicle's wheels are properly aligned when the car will drive down the road in a straight line without drifting or pulling to either side. A drift or pull can be caused by problems other than just alignment, so a thorough inspection should be performed by a qualified shop to determine the exact nature of the problem before an alignment is performed.

Spending a few minutes with your tires every month can help protect your family, improve your vehicle's performance, and lengthen the life of your tires.

Tire Safety and Maintenance - Link to original story

High number of motorcycle and vehicle collisions in Southern Interior leads to safety talks 2017-08-03

Originally posted by Liz Brown from www.kelownanow.com

With the recent motorcycle accidents and fatalities in the B.C. Interior, ICBC is reminding motorists and motorcyclists to be cognizant of your distance between other vehicles on the road.

In British Columbia, 60% of motorcycle crashes involve other vehicles, often when a vehicle is turning left in front of an oncoming motorcycle.

In 2016 in B.C., there were 2,600 motorcycle crashes, leaving 1,600 injured and many more killed.

Last year in the Southern Interior, 330 motorcyclists were injured in 440 crashes. On average, 11 motorcyclists are killed in crashes each year in the region.

ICBC says the main factor for motorists who hit motorcycles is distraction and inattention, as well as failing to yield right-of-way and improper turning.

In order to reduce the number of crashes and collisions, practice safe driving by applying the following four tips:

  • Give more than enough space between your vehicle and a motorcycle when passing: It's harder to gauge the distance between your vehicle and a motorcycle. Give at least three seconds following distance when you're behind a motorcycle.

  • Scan intersections: Be a defensive driver and preemptively watch for other vulnerable road users. The majority of car and motorcycle crashes occur at intersections. Drivers need to watch for motorcycles when turning left, as it can be harder to gauge how fast a motorcycle is traveling. If in doubt, wait for the motorcycle to pass.

  • Leave your phone alone: Distracted driving is one of the main factors in collisions. Avoid anything takes your eyes off the road. Instead, give your passenger a task or pull over to complete a task.

  • Share the road with motorcycles: If in doubt about who has the right-of-way, yield to the motorcycle and avoid a crash that could result in a fatality.

 In the same way, motorcyclists have a responsibility to practice defensive riding and control their speed.

Tips for motorcycle riders:

  • Wear all the right gear, all the time: This includes helmets that meet the DOT, Snell or ECE safety standards and safety gear for riding. It might be hot, but that's no excuse to make poor decisions regarding safety gear. 

  • Scan intersections: Motorcycle riding is all about planning ahead and anticipating road scenarios. 

  • Be bright and visible: Protect yourself and your passengers from serious injury by choosing gear with bright and reflective colours

  • Maneuver intersections safely: Especially where oncoming traffic is waiting to turn left, adjust your lane position and reduce your speed well in advance, giving yourself time to stop or an escape path if needed.

  • Share the road with vehicles: Never assume a driver has seen you. They may not accurately judge your distance or speed of approach. Stay out of drivers' blind spots. Practice appropriate signaling and lane changing.

High number of motorcycle and vehicle collisions in Southern Interior leads to safety talks - Link to original story

ICBC Practice knowledge test for new drivers 2017-07-19

Parents: help your teen pass their driver's licence written test with ICBC's online practice app and then find their new vehicle at Russo Auto Sales

ICBC Practice Test - Link to original story

Top Summer Car Care Tips 2017-07-14

While cheap loans can make buying a new car seem attractive, opting instead for a used vehicle is sometimes be a better choice.

Let's be honest, the new car smell is great but it's not always worth the thousands of dollars a hunk of metal depreciates the minute it's driven off the lot.

There are a few things to consider when shopping for a used car so that the savings don't shift gears into pricey repairs and headaches down the road.

Here are four tips to help you when shopping for a used car so that you can find the right vehicle as smoothly as possible. 

Take it for a spin 

This is your first chance to see if the car drives the way you like and whether there are signs of trouble with how it hums along. 

When starting up the car for the first time, it should fire up easily. Look at the dashboard and keep an eye out for warning symbols like a check engine light. If the instrument panel lights up like a Christmas tree, it's not worth shifting it out of park. 

Automotive Retailers Association president and CEO Ken McCormack says shoppers should look for other problem signs in the car as they're driving along.

"It shouldn't pull in any direction or vibrate and shouldn't give any excessive road noise," he says. "When applying the brakes, the pedal should be firm without any pulsation or noticeable feedback." 

Shifts should also be smooth and the engine shouldn't hesitate or stutter, he says. And don't forget to look at what's going on behind you as you drive away. 

"Any blue or black smoke from the exhaust as well as any burning smells or unpleasant odours from the car should be a red flag." 

Get the history 

While a seller might claim that a vehicle is "accident free" and only ever had one owner, a bit of research can easily tell you whether that's true. 

McCormack suggests buyers get a vehicle history report for the specific car they're interested in."Vehicle history reports have come a long way in the last ten years," he says. "Currently the best option for Canadian car shoppers is Carproof."

Such a report can be provided by the seller, or it's something the buyer can get on their own online.

Carproof's vice president of marketing Joe Varkey says they can also tell buyers if a body shop provided an estimate to repair damage - even if an insurance claim wasn't actually made.

"The difference is that if you saw a $1,000 estimate but no insurance claims, you know something happened. It may not be anything significant, but you know something."

This additional information can help buyers negotiate a better deal on the car if they don't mind that there's been minor damage, as long as it was repaired properly.

"And if the seller is telling you a car is perfect, you run a Carproof, and you see a $15,000 claim on it, then you know something about the seller," Varkey says.

In addition to the ownership, odometer and claims history of a vehicle, a Carproof report can also tell buyers where a vehicle has been registered over the course of its lifetime.

"Let's say you're in B.C..is the car you're looking at from B.C., Alberta or Quebec?

You may want a car that has never seen salt," he says.

A vehicle with a lien against it, or if it's branded (a classification attached to severely damaged vehicles), should be avoided.

Inspect, inspect, inspect

After going on a test drive and looking over a history report, there could still be problems lurking under the hood.

But wait, shouldn't it be OK if a vehicle passed its provincial Private Vehicle Inspection (PVI)?

The PVI "really only skims the surface and covers mostly safety related issues," McCormack says.

While a PVI might tell you that there's enough tread on the tires and the brake lights work, it could miss other mechanical issues like a serious oil leak.

Some shops may offer a report based on their own mechanical inspection, in addition to the PVI. If a dealership does offer you its own in-depth mechanical inspection report, has a good online reputation, offers a warranty and includes a return policy, McCormack says their inspection may be enough.

But you should also consider taking the car to your own mechanic, to get it inspected, especially if you're buying in a private sale.

"A secondary inspection is like insurance, so if it makes you feel better and you determine that it's good value, then I would recommend it for peace of mind," McCormack says.

Get a deal that's true

If you're happy with the vehicle and its mechanics check out, it's time to close the deal. But before you commit, make sure the price is right. And yes, there's such a problem as a car being too cheap.

"Nothing, absolutely nothing should scare a purchaser more than if a vehicle is dramatically lower priced than comparable (models)," McCormack says.

Just as you do research to find the right car, it's also important to research the seller.

McCormack says buyers should run a check on the Vehicle Safety Authority's website to make sure a shop or sales representative is in good standing.

If you're purchasing privately you have to be more careful. McCormack suggests shoppers avoid curbers, because the buyer would have nearly no recourse if something were to go wrong as opposed to dealing with a licensed dealer.

Buying a used car? Tips to find the right ride - Link to original story

Buying a used car? Tips to find the right ride 2017-07-04

While cheap loans can make buying a new car seem attractive, opting instead for a used vehicle is sometimes be a better choice.

Let's be honest, the new car smell is great but it's not always worth the thousands of dollars a hunk of metal depreciates the minute it's driven off the lot.

There are a few things to consider when shopping for a used car so that the savings don't shift gears into pricey repairs and headaches down the road.

Here are four tips to help you when shopping for a used car so that you can find the right vehicle as smoothly as possible.

Take it for a spin

This is your first chance to see if the car drives the way you like and whether there are signs of trouble with how it hums along.

When starting up the car for the first time, it should fire up easily. Look at the dashboard and keep an eye out for warning symbols like a check engine light. If the instrument panel lights up like a Christmas tree, it's not worth shifting it out of park.

Automotive Retailers Association president and CEO Ken McCormack says shoppers should look for other problem signs in the car as they're driving along.

"It shouldn't pull in any direction or vibrate and shouldn't give any excessive road noise," he says. "When applying the brakes, the pedal should be firm without any pulsation or noticeable feedback."

Shifts should also be smooth and the engine shouldn't hesitate or stutter, he says. And don't forget to look at what's going on behind you as you drive away.

"Any blue or black smoke from the exhaust as well as any burning smells or unpleasant odours from the car should be a red flag."

Get the history

While a seller might claim that a vehicle is "accident free" and only ever had one owner, a bit of research can easily tell you whether that's true.

McCormack suggests buyers get a vehicle history report for the specific car they're interested in.

"Vehicle history reports have come a long way in the last ten years," he says. "Currently the best option for Canadian car shoppers is Carproof."

Such a report can be provided by the seller, or it's something the buyer can get on their own online.

Carproof's vice president of marketing Joe Varkey says they can also tell buyers if a body shop provided an estimate to repair damage - even if an insurance claim wasn't actually made.

"The difference is that if you saw a $1,000 estimate but no insurance claims, you know something happened. It may not be anything significant, but you know something."

This additional information can help buyers negotiate a better deal on the car if they don't mind that there's been minor damage, as long as it was repaired properly.

"And if the seller is telling you a car is perfect, you run a Carproof, and you see a $15,000 claim on it, then you know something about the seller," Varkey says.

In addition to the ownership, odometer and claims history of a vehicle, a Carproof report can also tell buyers where a vehicle has been registered over the course of its lifetime.

"Let's say you're in B.C..is the car you're looking at from B.C., Alberta or Quebec?

You may want a car that has never seen salt," he says.

A vehicle with a lien against it, or if it's branded (a classification attached to severely damaged vehicles), should be avoided.

Inspect, inspect, inspect

After going on a test drive and looking over a history report, there could still be problems lurking under the hood.

But wait, shouldn't it be OK if a vehicle passed its provincial Private Vehicle Inspection (PVI)?

The PVI "really only skims the surface and covers mostly safety related issues," McCormack says.

While a PVI might tell you that there's enough tread on the tires and the brake lights work, it could miss other mechanical issues like a serious oil leak.

Some shops may offer a report based on their own mechanical inspection, in addition to the PVI. If a dealership does offer you its own in-depth mechanical inspection report, has a good online reputation, offers a warranty and includes a return policy, McCormack says their inspection may be enough.

But you should also consider taking the car to your own mechanic, to get it inspected, especially if you're buying in a private sale.

"A secondary inspection is like insurance, so if it makes you feel better and you determine that it's good value, then I would recommend it for peace of mind," McCormack says.

Get a deal that's true

If you're happy with the vehicle and its mechanics check out, it's time to close the deal. But before you commit, make sure the price is right. And yes, there's such a problem as a car being too cheap.

"Nothing, absolutely nothing should scare a purchaser more than if a vehicle is dramatically lower priced than comparable (models)," McCormack says.

Just as you do research to find the right car, it's also important to research the seller.

McCormack says buyers should run a check on the Vehicle Safety Authority's website to make sure a shop or sales representative is in good standing.

If you're purchasing privately you have to be more careful. McCormack suggests shoppers avoid curbers, because the buyer would have nearly no recourse if something were to go wrong as opposed to dealing with a licensed dealer.

Buying a used car? Tips to find the right ride - Link to original story