Do you have shiny or banged-up credit?
Yochim recommends checking your credit three to six months before you start shopping for a new car so you have time to correct any errors on your credit report and to take steps to improve your credit score if you can.
Michalek says bad credit will hurt whether you buy or lease a car, but it will hurt more on the lease side. "If your credit is really bad, you may not be able to lease at all, because dealers typically only lease to consumers with good credit," he says.
Even consumers with bad credit can usually finance a car purchase, although they won't get the best interest rates, Michalek says.
Pete D'Arruda, president of Capital Financial Advisory Group LLC in Cary, N.C., recommends saving money so you can make a bigger down payment and borrow less in order to reduce the interest costs.
"You may need to go down a little in the quality of the car you choose if your credit makes the cost of borrowing too expensive," D'Arruda says.