In a huge country, getting around can be a bit of a task if you don’t drive. Fortunately, a car is considered a necessity in the United States of America (USA), thus many would rent or buy a car in the USA. The process of owning one is similar to most countries. However, there are pain areas to consider, especially if you’re not a local.

The metropolitan areas are well-connected thanks to public transport systems. However, suburbs are what makes having a car mandatory. Travelling for grocery shopping or for weekend getaways can all be done without much stress if you own a car. Technically, you don’t even have to own a car. Leasing or renting gives you access to a brand new four-wheeler that’s good enough to hit the roads.

Should you decide to buy or lease a car in the USA, the vehicle would prove to be a great addition to your lifestyle. Below how you can obtain a car in the USA, so if you’re struggling with such a question, do give it a read!

How to buy a car in the USA

buy or rent a car in the usa
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1. What kind of driving licences are accepted in the USA?

When relocating to the USA, getting your licence is your biggest priority. It is a mandatory requirement when registering for a vehicle. While some states allow the use of an international driver’s licence – and it’s a good idea to have one ready before arriving – a US driver’s license is still a key prerequisite to buying a car. In addition, a written or road test will be administered to accord the licence.

2. Road rules and regulations of USA

  • Wear seat belts at all times
  • Avoid exceeding speed limits
  • Use indicator lights when changing lanes
  • Drinking and driving is an offense, so avoid it

3. Cost of owning a car

A typical resident pays around $5,264 annually for the car he/she owns. This average is an aggregate of all the costs surrounding the car including gas, car insurance, repair and replacements. These annual rates vary with states – for instance, a Michigan resident pays over $9,304 yearly while a resident in Alaska pays just $3,586.

4. New car or pre-owned, old cars?

When thinking about buying a car in the USA (or any other place for that matter), there are two main options: an old, used car or a new car. But of course, this all comes down to financial expenditure. While it is true that used cars would cost you less, it might incur extra costs compared to a new car. (Some repairs might even add up to the cost of a new car!) So, it is prudent to do enough research before making your decision on which to invest in.

Apart from costs, there are a couple of challenges facing car buyers. Finding a desired car model with low mileage, good service and road history, and a fitting seller can be a daunting task. But it can be a dream come true if one happens to fulfil this checklist.

Buyers, fortunately, now have immense resources to assist them with the basics of car buying and owning. Online reviews provide key information ranging from baseline repair charges to common troubles and predicted reliability ratings. As such, ratings and reviews provide quantitative information on safety, reliability, performance and a gross value. This serves as a good starting point for prospective buyers.

5. Where can you find a car to buy?

After you have decided upon a car budget, the next stop is where to buy it. Consider taking a look at both the U.S. News & World Report for new and old car rankings and reviews. Then head to the automotive e-commerce portals and websites to find your dream car.

Car dealerships are great to purchase pre-owned cars in the USA as it also offers home deliveries when personal pickups can’t be arranged. Franchised new car dealers, pre-owned cars superstores, independent car dealers, “buy here pay here dealers” and private party sellers are additional resources to dive into the car market.

6. Certified Pre-owned Cars (CPO)

CPO (Certified Pre-owned Cars) are an amazing choice for buyers, who want to stay away from the risks of no-warranty coverage. These low mileage cars have good road history and are only a few years old. Plus, they are affordable, too. Most of these cars are leased-out vehicles that have undergone refurbishment and evaluation at the dealership. As such, buyers can choose CPO cars over non-certified used cars and be assured of reliability and safety.

Moreover, CPOs prove to be a great alternative to non-certified cars as it is available at special financing deals with much lower interest rates. Note that while CPO cars are more expensive than non-certified cars, it offers a safe and pocket-friendly middle-ground to compared to new and used car loans.

7. Financing cars

Unless you’re ready to splurge on your sweet new ride, you will have to sort out your finances before buying a car in the USA.But bear in mind, getting credit to back your expenditure is a pretty hard thing to do, especially if you have no credit history in the US.

That said, be prepared for sky-rocketing interest rates if you happen to get a loan sanctioned. However, companies like International Autosource come as a relief with its lower interest on car loans and leases. To save yourself from spending a big sum of your savings on loan repayment, consider making a down payment that constitutes 10 to 20 percent of the lump sum.

8. Where to look for loans

There are tonnes of options you can turn to for car loans other than conventional banks. Some of the major financial forces in the USA are the following: finance companies, car dealerships, big national banks, online banks, credit unions, community banks.

9. Car insurance

Getting car insurance for your new car is key to ensure protection against damaged caused by unforeseen emergencies – especially if you have a loan or lease on your vehicle. Obtaining car insurance has two criteria: credit history and driving history in the USA. While car loans are infamous for playing hard to get, car insurance is even more notoriously known to be difficult for expats to obtain.

10. Safety and Emission Evaluation

Buying a new car in the USA comes with pre-completed safety and emission checks. However, you might want to consider getting your pre-owned car before the registration process starts. The safety check evaluates the car’s safety equipment – brakes, horns, tires, turn indicators, headlights, wipers and more. Note that the safety inspection is valid for a year and should any component fail the check, you will have to get them replaced or repaired and undergo the inspection procedure again.

The emissions inspection ensures that the vehicle is safe for the environment and operates within ideal emission boundaries. It is valid for two years and the and the results are sent directly to the Department of Motor Vehicles (DMV).

11. Registering the car

Registration is the next big step after buying a car in the USA. The primary requisites for the registration are driver’s licence and proof of insurance. Car buyers are also required to pay the sales tax at the time of registration.

Buying a car in the USA from a car dealership or the International Autosource comes in with a handy registration process carried out by the respective agencies. In case of purchase from a private party, you will have to submit the following documents to the DMV:

  • Title of the car (as given by the seller)
  • Bill of Sale or letter from the seller containing information about the vehicle type, selling price and vehicle identification number (VIN)
  • Auto insurance proof
  • US driver’s licence or particular state requirements for those without a US driver’s license

The registration process also mandates the payment of registration fees, licence plates and the sales tax. After a period of 30 days, a temporary registration will be issued and the official registration sticker will be sent by mail.

How to rent a car in the USA

buy or rent a car in the usa
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Car leasing is a great alternative to the conventional car buying practice. This section discusses the basics of car leasing in the USA, so keep reading!

To lease a car in the USA, contact a car rental agency or make a booking online at car rental portals or websites. Car pickups mostly occur near the airport, but there’s no hard and fast rule on how to go about it. Car pickups can also be done at any point in the city and can take you to your destination, too.

1. How long is the car required?

One of the most obvious questions will be the duration of which the car is needed. If you’re staying in the United States for more than three months, getting a car leased would be a better choice. Even though the rapid and efficient public transport system ensures that everyone can commute hassle-free, certain states are a little difficult to access without a car. However, for visits under three weeks, leasing a car in the USA might be harsh on your pocket.

Here are several terms for car leasing in the USA:

  • Drive should be at least 21 years old to rent the car
  • A legal driver’s licence
  • Credit card
  • Liability insurance
  • Car must be returned with a full gas tank

2. Where to rent a car?

Here is a list of best car rental websites that will assist you in leasing a car in the USA: Avis, Budget, Hertz, Thrifty, Enterprise Rent A Car and Alamo.

3. What’s the cost of leasing a car?

Car leasing costs vary depending on state, company, type of car, the season and the duration. The cheapest car can cost you somewhere around $500 per month (and more if you purchase insurance).

4. Deposit

Insurance isn’t the only amount you’re required to absorb. In order to qualify for the lease, one must have adequate funds in their credit card as delineated by company policies. A deposit of $200 to $350 will be asked and this is non-negotiable, even if the car is needed for only a day.

5. Insurance

A car insurance will protect you from charges levied for any damage done to the vehicle. While comprehensive insurance like Collision Damage Waiver (CDW) or Loss Damage Waiver (LDW) are advised while liability insurance is a bare minimum. Even credit cards like American Express offer some coverage when you lease the car through them.

6. Mileage

Car leasing in the USA has some limits, especially when it comes to distance. There are restrictions on how far you take can the leased vehicle. Some companies allow same-state registration and operation, while others allow other state operation if prior notice about the states is given and approved.

7. Additional fees

Things that are worth noting:

  • Don’t be late on the return day of your car as even a one- hour delay can result in day’s extra charge
  • An underage fee might be levied if you are under 25
  • For multiple drivers, a surcharge may be levied ranging from $5 to $25
  • GPS navigation can be provided at an extra cost

8. Terminating the lease early

At some point, you might want to terminate their lease. If the event where you want to terminate your lease ahead of its expiration, the following course of actions can be followed:

  • You can opt to buy the car and sell it. This might prove to be profitable.
  • In order to absorb penalties from a prior lease, you can get it into a new lease with the same dealership.
  • Look for someone who is willing to take over your lease. There might be a transfer fee, but more companies and individuals are considering this option.

Owning a car is something that will save you a lot of commute time, especially at a large country like the USA.  But renting a car daily might prove to be much costlier than buying or leasing a car.

Given the growing importance of cars and driving as a life skill, the perks of having a car are limitless. The need for cars is greater than what is estimated, so by investing in a car you are investing in yourself and improving your standard of living.

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