The Buying A Car in Texas Guide: What To Do

December 20th, 2024 by

Buying A Car In Texas

Buying a car is a big decision, so it’s important to do it right. In our guide to buying a car in Texas, we’ll walk you through the whole process, including shopping for a car, securing financing, and negotiating the price. Plus, we’ll talk about the differences between buying from a dealership and buying from a private seller. If you’re looking for a new or used car, you can find it here at Tipton Hyundai. We’re in Brownsville and we serve McAllen, Weslaco, Harlingen, and the rest of the state including Austin and Dallas.

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Buying a Used Car in Texas

If you’re looking to save money, buying a used car in Texas is a great idea. However, it requires careful consideration to ensure you’re getting a good deal. Make sure you do thorough research before buying a used car in Texas. Sites like Kelley Blue Book and Edmunds will give you a good idea of the fair market value. Also, consider the reliability of the make and model you’re buying. If you purchase a used car that has been well cared for, you can get a lot of life out of the car while saving money. 

Buying a New Car in Texas

If you’re looking for a pristine car with the latest technology, buying a new car in Texas can be a great choice. Still, you’ll want to take your time before you make the purchase. Look into the reliability of the make and mode, recalls, and safety crash testing. Also, be aware that new cars depreciate in value as soon as you take them off the lot. 

How to Buy a Car in Texas

Since a vehicle is such a big purchase, you’ll want to take your time when buying a car in Texas. Here’s a step-by-step of how to buy a car in Texas:

  1. Determine your needs and budget. Consider size, features, and fuel efficiency. When setting your budget, include the cost of the car, insurance taxes, and registration fees. If you’ll be financing your car, determine how much you can put down. The bigger the down payment, the smaller your monthly payments will be. Get pre-approved for financing before you go car shopping. 
  2. Do thorough research. Use online resources to compare car models and prices. Are there any safety recalls on the vehicle you’re considering? 
  3. Decide whether to purchase through a dealership or a private seller. Check dealership reviews for reliability and customer service. If buying a used car, dealerships provide more protection for the buyer. With a private seller, expect to purchase the car as is with no warranties. Additionally, a dealership will handle a lot of the paperwork for titling and registering your vehicle. If you’re considering using a private seller for a used car, be extra cautious. Always ask for a vehicle history report.
  4. Inspect the vehicle. Whether you’re buying a new or used car, always take a close look. For new cars, verify that the vehicle has the features, trim, and any additional packages you may have paid for. For used cars, consider hiring a mechanic for a professional inspection. Check that the VIN matches the title and that the title is clean. Test drive the car. Check for strange noises, smooth braking, and handling if the seller won’t let you, consider walking away. 
  5. Negotiate the price. Go in with an understanding of the car’s market value to get the best deal. A dealer may not have as much leeway to negotiate as a private seller, but you should still be able to negotiate some. 
  6. Look over the contract before signing. Make sure the price and terms match what you’ve agreed on. If you’re getting a loan to pay for the car, make sure you know how many months the loan will be as well as the monthly payments. Do not leave with the car before everything is finalized. 
  7. Complete the paperwork. If working with a dealership, they will handle much of this process. You’ll need a title transfer, bill of sale, and application for title and registration. You’ll also need to purchase insurance. Texas requires proof of liability insurance before you can register the car. 
  8. Save all documents related to your purchase. Keep them in a safe place in your house, rather than in the glove box. If the car is stolen, you’ll want to have records that you are the owner. 

Required Documents

When buying a car in Texas, you’ll need to fill out and sign a number of documents. A dealership typically handles most of the paperwork for you, but if you buy from a private seller, you’ll need to make sure to take care of everything. Here are the required documents when purchasing a car in Texas:

  • Application for Texas Title and/or Registration (From 130-U): This form is required to register the car and transfer the title to your name. If you’re financing the car, the new title will be sent to the financier. When the loan is paid off, they will mail you the title. 
  • Bill of Sale/Purchase Agreement: This document details the car’s purchase price, taxes, and additional fees. If you’re buying from a private seller, this document isn’t necessary, but it’s usually a good idea. 
  • Odometer Disclosure Statement: For used cars under ten years old, you’ll need an odometer disclosure statement. This just states the number of miles the car has been driven and helps prevent odometer reading fraud. This can be done on the title itself or in a separate form if no space is available. 
  • Vehicle Title: If you’re buying from a private seller, you’ll need the title signed over to you from the seller to transfer ownership. Make sure the title is free of liens before buying and double-check that the seller completes the Assignment of Title section. 
  • Proof of Insurance: Before you can register the car in your name, you’ll need to purchase insurance and provide proof. Texas requires a minimum of liability insurance, but if you’re financing, you may need to purchase full coverage insurance.

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First-Time Car Buying Program in Texas

In Texas, there are a few programs and resources available for first-time car buyers. While the state does not have a specific first-time car buyer program, various financial institutions, dealerships, and nonprofit organizations offer assistance for those buying a car for the first time. These programs can help make the process easier, more affordable, and less intimidating. 

  • First-time buyer financing programs: Many dealerships, credit unions, and banks offer special financing options for first-time buyers with little to no credit history. These programs usually have lower interest rates, incentives, flexible loan terms, and co-signer options if needed. 
  • Credit union programs: Credit unions in Texas often offer first-time car buyer loans with more favorable terms than traditional banks. Some may offer lower interest rates and pre-approval so buyers know their budget ahead of time. They are usually able to work with buyers who have limited or no credit history, offering alternative ways to assess creditworthiness.
  • Texas Veterans Commissions (TVC): If you’re a veteran, you may qualify for special benefits or financing assistance programs to purchase a car. 
  • Texas Department of Housing and Community Affairs (TDHCA): This non-profit offers programs designed to help low-income families with transportation options, which might include assistance with buying or financing a vehicle. 
  • Job Access and Reverse Commute (JARC): Although Texas doesn’t have a direct program for first-time car buyers, JARC is a federal program that provides low-income individuals with transportation assistance for employment. 

If you’re a first-time buyer buying a car in Texas, here are some tips that may help you:

  • Know your budget. How much can you afford monthly, including car payments, insurance, and maintenance?
  • Consider used cars. New cars depreciate quickly, so consider buying a used car to get more value for your money. 
  • Check your credit score. A better credit score helps secure better financing. If your score is low, work on improving it before applying for a loan. 

After the Purchase

Once the ink is dry on the contract and you have the keys in your hand, you may be wondering what happens next? If you’ve bought the car from a dealership, they’ll handle submitting the title and registration for you. However, if you buy the car from a private seller, you’ll need to go to the county tax assessor to submit the paperwork and pay the associated fees. 

You should receive your registration and license plates in the mail within a few weeks. You’ll have temporary tags to use in the meantime. They’re valid for 30 days, so make sure you handle the paperwork well before then. 

If you’ve purchased a new or certified pre-owned vehicle from a dealership, the warranty takes effect immediately. Make sure to check the coverage details for repairs and maintenance. 

Some people assume that you have three days to cancel the purchase of a new or used car. However, this is not the case. In Texas, once you sign the purchase agreement, the car is yours. There is no automatic right to return in Texas. Some dealerships may offer a return policy or exchange program, but this is voluntary. Always confirm the terms before buying. 

If the car does have a serious undisclosed defect, you might have grounds for legal action under the Texas Deceptive Trade Practices Act. Contact the dealership immediately if you think there is a major defect. They may be able to offer a remedy, such as an exchange or buyback. If they refuse to cooperate, you can file a complaint with the Texas Department of Motor Vehicles. 

Getting Car Financing in Texas

While some people choose to buy in cash, many people opt to finance their new vehicles. If you’re getting car financing in Texas, you’ll need to follow these steps:

  • Check your credit score. The higher your score, the better the rates you’ll be able to receive. 
  • Gather the required documents, including proof of income, proof of identity, proof of residency, proof of insurance, and vehicle information. 
  • Shop for financing options. You can finance a car through a bank, credit union, online lender, or dealership. By comparing rates and terms, you’ll be able to find the best deal. In general, credit unions offer the lowest rates. Financing through the dealership is convenient as the dealer will act as a middleman between you and the leaders.
  • Choose loan terms. Car loans typically range from 36 to 72 months. Longer terms mean lower payments but more interest over time. Aim for a downpayment of 10-20%. 
  • Once approved, review the loan terms carefully. Make sure you understand the interest rate, loan term, and monthly payments. Make sure to make your monthly payments. You may set up auto-pay or reminders so that you’re not late. Late payments may negatively affect your credit score. 

Buying a Car in Texas from Tipton Hyundai

Now that you understand the process of buying a car in Texas, you’re ready to shop around. At Tipton Hyundai, we have a large inventory of new, used, and certified pre-owned cars to choose from. Whether you’re looking for something practical or something with zip, we’re sure to have what you need. Come check us out today! 

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