How to Read a Car Ad

Fine Print reveals the real savings...if any.

• "One Only At this Price": Some ads are for cars that are such ugly colors or are so severely stripped that the dealership advertises them at bargain prices. They hope that people will be drawn to the dealership thinking there are other cheapo cars. Wrong. This "ad car" is the only one — and it's blocked in by hulking vans on the back lot somewhere. Look for the telltale phrase "one only at this price" to tell you if it is an ad car.
  
  
• Low Monthly Payments: Ads often promise wildly low lease payments for luxury cars. You scour the ads thinking, "Can it be true?" If you hold your magnifying glass over the small print at the bottom of the page, you'll see that you have to make a gargantuan down payment to get the monthly payments quoted. In fact, you could get any monthly payment you wanted if you were willing to make a large enough down payment.

• Incentives and Rebates: Auto manufacturers sometimes offer incentives to spur the sale of slow-selling vehicles. Car ads are an important way to learn about this financing method.
  
  Remember the Sales Tax: Another favorite in leasing ads is to quote low monthly payments that don't include the sales tax. Usually, you will find small print lurking somewhere that says, "Plus tax and license fees." To compute the tax yourself, multiply the monthly payment by your state's sales tax. Add the sales tax to the quoted payment to get the total monthly payment.
  
  Length of the Contract: Some monthly payments look good until you see the length of the loan. While $399 a month might look good for 36 months, it will break the bank when stretched to 60 months.
  
  Interest Rates: Dealers will offer low interest rates available through the manufacturer. Sometimes, these rates are way below the prime rate available through banks. This can save you hundreds of dollars over the term of the loan.
  
  
• Available Models: Some models of selected cars qualify for big savings. Others don't. Read the fine print, and you'll find out where the bargains are.