Financial Checklists Before Buying a Vehicle: here's what actually helps. Before you buy a car, take the time to do a little research. There are some things you should always check before signing a contract.
What You Need to Know Before Buying a Vehicle
Buying a car can be a stressful process, especially if you’re not familiar with the steps you need to take. Here are some things to consider when purchasing a new or used car.
Check the VIN for Recall Information
The U.S. Department of Transportation’s Vehicle Safety Hotline at 1-888-327-4236 provides information on recalls and safety issues for motor vehicles. They also have a website called www-odi.nhtsa.dot.gov which provides additional information on recalls.
Look Up the Vehicle’s Title History
There are several websites that provide information on a vehicle’s title history, including the National Motor Vehicle Title Information System (NMVTIS) at vehiclehistory.bja.ojp.gov. These sites offer accurate information about a vehicle’s title, odometer data - and certain damage history.
If you want to look up a vehicle’s title history through the NMVTIS, expect to pay up to $4 per report.
Get a Vehicle History Report
A vehicle history report can help you identify potential issues with a used car. Some of the things a vehicle history report might reveal include flood damage, accidents, and previous ownership details.
The National Insurance Crime Bureau (NICB) atmaintains a free database that includes flood damage and other information.
Read the Buyers Guide
The Buyers Guide is a pamphlet that must be displayed prominently and conspicuously on or in a vehicle when a car is available for sale. It contains important information about the car, such as its warranty - the dealer’s contact information, and the seller’s responsibilities.
The Buyers Guide must be displayed prominently and conspicuously on or in a vehicle when a car is available for sale, meaning it must be in plain view and both sides must be visible.
Consider Your Budget
When buying a car, it’s important to consider your budget. The average cost of owning a car is $11,577 annually or $965 monthly - according to AAA's 2025 Your Driving Costs study.
Here are some factors to consider when determining how much you can afford to spend on a car:
- Monthly Payment: The average monthly payment on a new car was $767 in the fourth quarter of 2025, according to Experian.
- Fuel Costs: Drivers overall pay an average of 13 cents a mile for fuel, based on average prices for regular unleaded gas and electricity per kilowatt hour during a 12-month period ending in May 2024.
- Insurance: The average annual premium for full-coverage insurance runs car owners $1,694, according to AAA.
- Maintenance and Repairs: Regular maintenance and repairs can be expensive - especially for older cars.
Know Your Rights
As a consumer, you have rights when it comes to buying a car. Here are some things to keep in mind:
- The Used Car Rule: Car dealers who sell, or offer for sale, more than five used vehicles in a 12-month period must comply with the FTC's Used Car Rule. This rule requires dealers to provide a Buyers Guide, which must be displayed prominently and conspicuously on or in a vehicle when a car is available for sale.
- Servicemembers: The CFPB is working to protect servicemembers from costly auto loans and wrongful repossessions.
- Complaints: The CFPB forwards complaints to companies and works to get a response - generally within 15 days.
Conclusion
Before you buy a car, take the time to do your research. Look up the vehicle’s title history and get a vehicle history report. Read the Buyers Guide and consider your budget. Finally, know your rights as a consumer. By taking these steps, you can avoid making costly mistakes and ensure a smooth and stress-free car-buying experience.
References
- Motor Vehicle Title Information System - vehiclehistory.bja.ojp.gov
- $11,577 - nerdwallet.com
Further reading
- https://www.consumerfinance.gov/consumer-tools/auto-loans/
- https://www.consumerfinance.gov/ask-cfpb/what-should-i-know-before-i-shop-for-auto-loan-at-a-bank-credit-union-dealership-or-other-lender-en-755/
- https://www.nerdwallet.com/auto-loans/learn/total-cost-owning-car
- https://vehiclehistory.bja.ojp.gov/nmvtis_buyingtips
Disclaimer
This article is a personal reflection shared for general informational purposes only. It is not financial, investment, insurance, or tax advice. For decisions about your own money, please consult a qualified financial professional.
