In today's video, I'm going to help you buy a car.
Now, I'm not going to give you a loan or anything like that, but I am going to give you a lot
of very useful vocabulary that you need to take with you when you go shopping for a car.
So, we're going to start by looking at all the technical aspects of actually shopping
We're going to look at the things you need to consider in terms of the money and the
actual buying, and then we're going to look at things you need to look for in the car
Things you have to consider before you choose and pay for a car, okay?
So again, things about like the technicals, like the financial aspect, and then the actual
Let's say you walk into a dealership, and you're going to go speak to a dealer, and
the place is called a dealership.
Now, it doesn't matter if you're buying a used car or a new car, you're going to go
You could buy online or you could buy through classified ads.
If you know a lot about cars, no problem, go ahead.
If you don't know a lot about cars, maybe go to a dealership or take a friend who does
know.
So, you're going to walk into a dealership and you're going to see a car you like, and
you're going to find out the base price or the sticker price.
The sticker price is the price that they are showing you before negotiations, before adding
any sort of features or options, which I'll talk about.
This is just where you're starting from, the base price.
Now, a lot of cars will - a lot of dealerships will show you the MSRP, Manufacturer's Suggested
This is what the maker of the car thinks that the dealer should sell it for.
But keep in mind, almost always you're going to see the MSRP here, and then you're going
to see the dealer price is lower.
That's part of the marketing tool or the gimmick to make you think you're saving money.
Now, if you're going to buy a used car, they will also have a base price.
This is where they're going to start from, but it's much easier to negotiate for a used
Now, what you should also find out - and again, this is in Canada and the States, we have
something called a "blue book".
A blue book puts the general value of all the different cars from all the different
years, all the makes, all the models - which, by the way, you should also know.
Make is who makes the car, like is it a BMW, is it a Chevrolet, is it a Honda?
And the model is the actual type, so Accord or Malibu or whatever.
So, the blue book will tell you, especially for the used cars, the blue book will tell
you how much the average price of this particular make and model for this particular year with
more or less this many kilometers or miles on it.
So, very important that you somehow find that out.
Other countries, I'm not sure if they have that.
Now, these days, nobody calls them used cars anymore.
Somebody eventually figured out that the word "used" has a little bit of a negative feeling
or a negative connotation attached to it.
People don't want to buy used, but they are very okay with pre-owned.
Somebody else owned it before, that's okay.
But the car is used, that's a bit of a problem, so just keep in mind, they're going to be
Certified means that the dealership checked the car and the dealer says that everything
is okay, it's safe to drive, it's safe to own, and that's okay.
Keep in mind, if you see a used car that doesn't have the certification, be a little bit careful,
because any problems are your problem, not the dealer.
If it's certified pre-owned, any problems the dealer must fix, so it's good to - important
So, then, when you go to the dealership, you can ask the dealer for the dealer invoice.
The dealer invoice is a piece of paper that shows how much the dealer paid for the car,
and you can use that as part of your negotiations.
Not every dealer will give it to you, but a lot of them do because they want to appear
honest and they're giving you a good deal, they want to sell you a car.
Now, you have a few options when it comes to getting a car.
You can just buy the car, just pay full price, take the car, drive away, no problem.
Financing is basically a loan that the dealership or the manufacturer will give you when you
But always pay attention to the APR, annual percentage rate.
This is how much interest you will pay on the car.
Now a lot of dealerships, when they have, like, sales, like they have big sales, they'll
say zero APR, meaning no interest.
But always go and look for, like, the fine print.
In the contract, they'll say zero interest for two months, and then you pay, like, regular
If they say no interest for the three years, very good deal.
But then the price probably is a bit higher.
Leasing is like renting, except it's different, because you put down a lot of money.
So, first of all, you start with a down payment.
You have to put a big chunk of money, obviously not the full price of the car or even half,
but it's still, like, $2,000, $3,000, you put a down payment.
And then you have monthly payments with a little bit of interest.
So, you're renting the car for as many years as you want, like four years, five years,
So, you're buying - you're leasing for a term, and you can find out - different dealerships
Now, how a lease works is when that term is finished, you can give the car back and lease
another one or buy another one, or you can have a buyback, which means you can pay whatever
the remaining value of the car is and keep the car.
It can be called a buyback or a buyout.
Means you're basically buying the car at the end of the lease for obviously a much lower
So, because at the end of the lease, you now have a used car.
So, you're basically buying a used car, except you're the one who used it.
So, some people are very comfortable with that.
Many people, they lease a car for four years, and every four years, they get a brand new
car.
And if you continue with the same make and model, or the same make anyway, and the same
dealership, they give you a better deal every time you get a new lease.
So, that's something to consider as well.
Next, now you have your car, you know how much the base price is, now you're starting
to look at adding more money to the base price.
Because you have to think about features, options, and add-ons.
Features and options are basically the same idea.
Features are things that are included with the car, and options are things that are - you
have to pay a little bit extra for.
So, for example, if you want a rear camera, a rear view camera, so when you're backing
up, you can see what's going on on the camera and the screen in front of you.
In many cars, that's standard, okay, standard is another word you need to know, so it's
Standard means it's a feature of the car, that's part of the car, you don't pay extra
You can't say no to it, but you don't have to pay extra for it.
So, some cars are standard, in some cars it's an option.
If it's an option, you're paying more.
If you don't want it, they take it out and you don't pay for it.
Options are usually things that are outside the car.
For example, some dealerships may try to sell you an add-on for cleaning the car, meaning
you pay a certain amount of money, and two or three times a year, you can bring the car
to the dealership and they will clean it inside and out very nicely, but you pay for it.
Or you can have roadside assistance.
If you have a problem, like a flat tire or your car doesn't work, they will send somebody
to where you are and they will fix the car on the spot, or tow you, if you need a tow.
A tow means they send a tow truck, they put the car, lift up the car on hooks or on a
flatbed, etc., and they take it to a garage to be fixed.
So, all of these things cost extra money.
Now, when you're considering a car, you always have to find out if there are any rebates.
So, some car makers will give you a rebate, they'll give you cash back if you buy the
car.
A lot of dealers will use the rebate as part of their selling tactic.
They will say, "This car is this much money, but you get a $2,000 rebate."
That doesn't mean that you're getting the $2,000 off the price of the car.
You're paying the full price, and then you send a rebate voucher, so basically it's like
You send that to the manufacturer, the manufacturer will send you back the $2,000, so you get
Try to confuse you and make you think that you're saving the $2,000 today.
And also consider the total cost of ownership.
A lot of people don't realize that after you buy the car, it doesn't mean you're stopped
You're going to need to do oil changes, you're going to need to do regular maintenance.
How much does cleaning it cost?
How much does it cost to repair or to replace certain parts?
So, you have to think about...
Let's say you own the car for five years, how much will it cost you each year to own
Now, some cars are obviously going to be much cheaper in terms of cost of ownership.
They will be better on gas, parts are cheaper, cleaning is cheaper, insurance is cheaper.
You have to think about all of these things together.
Now, if you buy a used car, it doesn't happen with new cars, it's generally with used cars
or pre-owned cars, you can trade in your car.
So, you have to take your car to the dealership, the dealer will inspect it, and see it, and
look at the blue book value of it, and then they will tell you what the trade-in value
So, let's say they think your car is worth maybe $5,000, so they will take the $5,000
off the price of the car that you want to buy, and then you get that discount.
Generally speaking, whatever they tell you the trade-in value is is a little bit lower
than what you would get if you sold it by yourself.
Why?
Because they're going to take your car, they're going to fix a few things, maybe clean it,
maybe give it a little bit of paint, and then they're going to sell it as a pre-owned, as
So, they want to make a little profit as well, so make sure that you understand you're getting
But you don't have to go through the trouble of selling it yourself, so that's a good thing.
Next, whatever the final price you think you're getting, always remember that they probably
haven't included taxes and fees.
If you live in Canada, you have to add the 13% sales tax, and then there's the delivery
tax, and then there's the paperwork tax, and then the dealer's fees that they don't tell
So, a lot of people, they go to a dealership and the final price is, let's say, $20,000.
They say, "Okay, you know, pretty good deal, I'll buy the car."
So then the dealer says, "Okay, we'll get all the paperwork ready", and then they get
their final bill and it's like 23.5.
And you're a little bit shocked.
Like, you thought you were paying 20,000 and then you get an invoice for 23.5.
Keep in mind there's a lot of things to consider.
If you want to ask your dealer what the final price is, make sure you say, "What is the
All in, including everything, and that's what you have to deal with, okay?
So, now that you know, okay, the financial aspect is ready, now let's look at the actual
car and see what you need to consider before you buy one.
Okay, so now let's think about the actual car and the things you need to consider before
you sign anything, before you give any money, etc.
First of all, decide what kind of car you want.
A coupe, two-door, usually a little bit more sporty, a sedan, four doors, more family style,
an SUV, sports utility vehicle, so it's a bit bigger, it looks a bit more like a truck,
usually bigger tires and you can go off-roading, although most people don't, four-wheel drive,
so very good for winter, in the snow, if you live in a snowy place, etc.
A hybrid is a mix of electric and gas.
You can - obviously, more and more you can buy full electric cars, but if you're going
to buy a full electric car, it's a whole different set of considerations.
Make sure you do a lot of research so you know what you're getting into.
A hatchback usually can be two-door or four-door, but the back is not a trunk, it's a door that
opens in the back, so if you have like a hatchback coupe, you have two doors and a third door.
If you have a hatchback sedan, you have two doors - sorry, four doors and a fifth door
And then a pickup truck, basically you have your cab and then in the back is a flat area
you can put equipment or whatever you need, usually for work, etc.
So those are the types of cars.
You have two types of transmission - I should have written that here - transmission.
Basically what - how does the car work?
So, you have automatic, you put it in drive, and go.
You put it in - or manual, you have gears, shift gear.
First, second, third, fourth, fifth, etc., so auto or manual, decide which one you want
Now, we used to call manual cars or stick shift cars "standard" because most cars came
manual and auto - automatic was an option.
Now, automatic is the standard, manual is the option because not many people want them
So now, you decided on the type of car, the type of transmission, now you need to do your
Now, this is especially important for used cars.
A lot of these things you don't need to worry about in terms of a new car because they will
fix whatever problems before they sell them to you.
So this is when you're doing - when you're buying a used car, make sure you find out
Not the verb "recall", noun, "recall" where the stress is on the first part.
A recall is when a car manufacturer discovers that there's a problem with a car, but maybe
thousands of cars have already been sold.
So they send out a letter to all the owners and they tell them, okay, here's the problem,
we're going to fix it for free, go to your dealer or find a dealership that's close to
you, make an appointment, bring the car, we will fix the problem and you can have the
car back and it costs you nothing, right?
They're calling the car back to fix whatever the problem is.
Now, this word, "lean", it doesn't look like it, but it sounds like this, "lean".
A "lean" is a very tricky situation.
If you're buying a used car and let's say the owner of the car owes the government some
money, but he or she hasn't paid the government, the government can put a "lean" on the car,
meaning that this person isn't really allowed to sell the car.
And if he does sell the car, all the money from that sale, the government can automatically
take before it even gets to him.
But if you bought a car that had a "lean", so this guy advertised in a newspaper, you
bought the car, you paid cash, now the "lean" is your problem because he transferred the
car over to you, it's your problem.
If you buy a car with a "lean", you're basically paying...
You're going to have to pay the government or whoever the person owes money to.
Well, in Canada, I don't know how it is in other countries, but in Canada, whenever you
buy a car, the owner must provide you with a history, a car history report to make sure
that there are no "leans" and there have been no accidents.
This history... this document, this history of the car will list all the accidents that
this car has had or all the insurance claims.
Every time this person called his or her insurance company to get money to fix something in the
car, this will be on the history report.
If there is a "lean" on the car, this will be on the history report.
Never buy a car without the history report for the car, okay?
Because any problems are your problem.
Next, find out what kind of warranty you're getting.
A warranty is basically a guarantee either by the manufacturer or by the dealer that
any problems with the car over a certain period of time or a certain distance travelled, like
a number of kilometres, will be fixed without cost to you, the consumer.
Now, you can get a factory warranty.
A factory warranty is by the manufacturer.
It could be five years, it could be one year.
Any problems, they'll fix, but make sure you understand what the warranty covers, okay?
Some warranties only cover engine.
Any other problems with the car, they don't fix.
Some warranties cover everything, so that's called a "bumper-to-bumper" warranty.
The bumper in the front of the car, there's a bumper in the back of the car, so anything
between the bumper and the bumper is covered under the warranty, you don't need to worry
A lot of companies will give you, like, five years or 100,000 kilometres.
Again, different companies, different warranties.
You can also buy an extended warranty from the dealer.
That means that any problems beyond what the factory warranty covers, the extended cover...
The extended warranty will cover it.
Up to you if you want to buy it or not.
Find out how much it costs, find out if it's worth it to you, and then make that decision,
okay?
Next.
Now, again, focusing primarily on used cars, there are a few things you need to keep in
mind.
First of all, you don't want to buy a lemon.
When we say a car is a lemon, we mean it looks good, but it's really a very bad car, it has
You really want to avoid buying a lemon, okay?
And also, be careful about bait and switch.
Now, this is not only for cars.
Anything that you buy in a store or online or wherever, always be careful about the bait
How this works is a dealer, for example, if we're talking about cars, a dealer will say,
"Here's this new whatever car for a really, really cheap price."
And everybody gets very excited, everybody goes to the dealership.
So, that really cheap price is how the dealer gets you into the dealership.
But when you're at the dealership, they will tell you, "Oh, well, this car, you know, it
doesn't include this and that, and we don't really have many available right now, and
Now, most people are not going to buy an orange car.
So, what he does, the dealer does, is he tries to sell you a different car.
Obviously, more expensive, more features, more things.
They get you in with a cheap car, and then they switch the sales to a different car that's
Be very careful about that, especially with used cars.
Now, always consider depreciation.
If you're buying a used car, and as soon as you drive it off the lot, off the - away from
the dealership, the value of that car has already gone down by $1,000, $2,000, $5,000.
The minute it's on the street, it loses value.
Find out what the depreciation value of the car you're buying is.
If you're buying a Mercedes, two years later you'll sell it, you'll still get a lot of
If you're buying, like, a different model or a different make of car, two or three years
later it'll be worth less than half of what you paid.
So, keep that - consider - take that into consideration.
Other things, MPG, miles per gallon, basically how fuel efficient is this car?
Is it going to cost you a lot of money in gas, or is it going to be very good on gas?
How much is it going to be - to cost to replace parts?
You're going to be driving the car, things are going to wear down, you're going to - things
are going to wear down or things are going to break.
Like, let's say, for example, brakes, brake pads eventually become very thin and you need
For some cars, it's very expensive to replace.
For some cars, it's much cheaper.
Find out how much it is for the car you're interested in.
How much will insurance cost you for this car?
Again, some cars very expensive, some cars very cheap.
A sports car will cost a lot more in insurance.
A family sedan will cost a lot less.
And then finally, let's look at some features and options.
Some of them will be standard, some of them will be options that you have to pay extra
for.
Rear view camera, I already mentioned before.
So, in Canada, the winters are very cold, so some people want a starter they can activate
So, they can be inside the house, they can press a button, the car will turn on, they'll
let it run for 10 minutes so it warms up, and then they'll go outside and get in and
It's a luxury, it's not necessary, so you're probably going to pay for that.
Luxury, not mandatory, so you're going to be paying for that.
Very good speakers, very weak speakers.
You have to consider all of these things before you buy a car.
Now, with all of this in mind, a little bit of advice, personal advice from my own experience.
When you go into a dealership, don't let the dealer pressure you into buying anything.
Like personally, when I go into a dealership, the first thing I tell the salesperson is
I'm not buying anything today.
Give me your sales pitch, tell me all about the car, but I'm not buying anything today.
Because I want to go home, I want to sleep.
We say sleep on it, I want to think, I want to make a good decision, and if I'm interested,
I will come back tomorrow and I will sign the papers and I will buy the car.
Be an educated and informed consumer, and make the good - the right decisions for yourself.
But all that aside, here's some basic vocab you need to help you get started on your journey
It's a big expense, make sure you're making the right choices, okay?
If you have any questions, please go to www.engvid.com and ask me in the comments section below.
There's a quiz just to give you - get a bit of a review and practice with this vocabulary.
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Don't forget to subscribe to my YouTube channel for more useful lessons to help you with other
And I'll see you again real soon for - with another hopefully good lesson.