The purchase of a car is an intimidating proposition for many people, especially those who aren't mechanics. It's tough to know exactly what could go wrong on a new car purchase. Everything might seem great, but then two weeks later you're driving your auto and the muffler falls off! That's the nature of the transaction. Like any other endeavor, though, a bit of education can go a long way.

Always negotiate

It's up to you to try and hammer out the best deal for a car. Besides your house, your car is generally the most expensive item you'll purchase. That's why it makes complete sense to take your time and negotiate a car deal that makes the most sense for you.

These days, many dealers are willing to cut deals on the purchase of new or used cars so you can consider yourself lucky if you're shopping in the current "buyer's market." There are many discontinued models that could bring huge discounts with them. Since the auto industry has been changing directions, a lot of former high flying models are no longer being offered and their inventory is priced to sell. If you can get such a car with a reliable warranty, you may just end up with the best deal you've had on a car in decades.

A couple factors you need to keep in mind when purchasing a new or used vehicle:

• The cost of parts and car repairs. Even if the car doesn't cost that much money up front, incidental costs for repairs can really add up. Find out how much it will cost to maintain the vehicle. Also consider that it might be more difficult to find parts for cars and trucks that are no longer being manufactured.
• The price of auto insurance. Some cars require very expensive auto insurance. Younger drivers and sportscar owners can expect to pay a higher insurance premium than a more experienced driver, or someone that drives a more conservative car. If auto insurance is really high, the overall total cost of ownership goes through the roof. See how much auto insurance will cost before buying the car.
• Fuel efficiency matters. Gas is very expensive and your car will always need it. If your car is a gas guzzler, the money you save up front will be eroded over time at the pump.

When you're shopping for a new truck or car, it's also worth noting that you can save a substantial amount of your hard earned cash by buying a demo model. Demo models are typically vehicles that were used to test drive or driven by employees of the dealership. Most demo models will have low miles and can't be sold as new. Since these cars aren't new, the buyer won't have to take the hit on the depreciation when the car leaves the lot. This can save the savvy car buyer anywhere from $5,000 - $7,000, just by choosing a slightly used car over one that's never been driven.

No matter what make or model you decide to buy, it's never a bad idea to shop around for the best auto deal available. In many cases, consumers can qualify for cash rebates or other incentives to purchase a new or used car. Before signing an auto loan that's 36 months, 60 months or 72 months, be sure that you can afford the monthly payment and try to put down as much cash as possible to make your payments less expensive.

Happy Auto shopping!