10 Tips for Regret-Free Car Buying
Tip 6. Don’t talk financing or trade-ins until you’ve settled on a price
A dealer isn't doing you any favors if he gives you a deal on the new car, and then offers you $1,000 below market value on your trade-in. The new car, the trade-in and financing are three separate negotiations — treat them as such. It's always in your interest to get the best possible price on each transaction; that's why you should do your research ahead of time. If the dealer isn't hitting the numbers you brought with you, shop or sell elsewhere.
Tip 7. Don’t fail the test drive
Taking a new car out for a spin can be an exciting experience, but don't get too giddy. If the salesman sees that you've formed an emotional attachment to the vehicle, it may put him out of the mood to compromise. "The fact is that analytical car buyers pay less for their new cars than emotionally charged buyers," Royce says. So stay calm, ask questions and pay attention to the behavior of the car. Take your time and inspect the environment of the vehicle, make sure that it's comfortable and that the controls make sense to you. You're going to spend a lot of time in this car, so it's OK to nitpick.
Tip 8. Take a close look at the fees
Before you sign anything, take a close look at all the numbers on each contract to ensure they are what you agreed upon. Don't be surprised to find a number of fees on the sales contract, but be aware that some are standard, some are negotiable and some are simply outrageous.
Expect to pay sales tax, a destination charge, title and registration fees, and a modest documentation fee ($50 to $100 is reasonable, but don't be surprised if dealers in some states charge up to $300). Advertising charges, which are fees charged to the dealers by manufacturers, often get passed right on to customers. Feel free to push back on these, or at least demand a further break on the price of the vehicle. Then there are things like the "dealer prep fee," which Royce characterizes as an outright scam. "All vehicles must be prepped before being placed on the dealership lot," he says. "So you shouldn't pay extra for it."
Royce also warns against "market value" dealer markups on popular cars. "This can be anywhere from $500 to thousands of dollars," he says. "It only works if you agree to it." If dealers refuse to eliminate this fee, maybe you should consider a less popular car.
Tip 9. Don’t buy into pointless dealership services
As if predatory fees aren't bad enough, there are useless extras hawked by dealers, including rust-proofing, window VIN etching, fabric protection and paint sealant. All are utter scams. The truth is that all modern cars already have rust protection from the factory. VIN etching can be done yourself with a kit, but it is hardly the theft deterrent it's claimed to be. Fabric protection can also be done yourself with a spray can, and paint sealant is just a liquid wax you can buy at an auto parts store for $10. You don't need any of it.
Tip 10. Be ready to walk away
Don't forget that your entire leverage with the auto dealer lies in your ability to walk out the door. No car salesman is going to take a loss on a sale, but even a few hundred dollars is better than a dead deal. You don't need to be obnoxious about it, but be firm in what you're willing to pay and accept in the negotiations. If he's smart, the dealer will come to terms that are acceptable, make the deal quickly and try to pull a fast one on the next sucker. But if he insists on trying to gouge you, then gather your things and politely say goodbye.
Sam Foley is a Connecticut-based automotive journalist who has written for GQ, Forbes, USA Today, the New York Post and various other publications.
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I can tell the author is recycling some old advice for car buyers. The car business has changed a lot over last 5-6 years.
Most dealers don't provide an online price within 2-3 days. Rather within 1-2 hours. That's what I do for a living, and I quote within 15 minutes of receiving the inquiry. Except for limited availability vehicles, I quote at invoice, always give my best price up front, and NEVER negotiate further.
Leasing is not the most profitable for a dealer. Financing is. There's a commission on financing, plus the dealer can sell products like extended warranty and GAP which you don't need in leasing.
My advice to a buyer: Be reasonable. Don't expect to buy the vehicle at cost unless you paid 20-30 million to own a dealership. And don't expect retail for your trade. You won't get it. Remember, when it comes to selling your trade, we're the customer....and we don't pay sticker just like you don't.
If you expect to buy a car at or below cost, and play games,....well, we know how to do that too, and you can be sure we're better at it.
I am a professional car salesman. I wish to stress the "professional" part. I don't rip people off, I don't deceive, and I don't play games.
Customers do constantly. I can't tell you how many times I have been told a customer is the original owner of a trade, but the carfax shows two owners before them. Like many professionals, I can spot a body panel that has been repainted or had other work done easily, but customers often claim it has never been in an accident. They will turn in a title with the trade that is not branded, but when we contact the DMV we find out that a new title has been issued showing the brand. It is almost sport for people to steal from a car dealer. Why is it not OK to steal from Safeway, but stealing from a car dealer is heralded as a noble endeavor?
If you want a great deal on your car, know what you want to pay. Offer it. Not three thousand less, but what you want to pay. I am happy to make a reasonable deal with anyone, but I'm not going to give away a car. And be nice! Treating your salesman disrespectfully and being a jerk will not get you a better deal. Trust me on this one.
We are allowed to make a profit. If you want professionals to help you, you have to allow enough of a profit for a professional-level paycheck. If you want someone to be here to service your car, take your trade, sell you accessories, etc then you have to allow a dealer to make a profit. 1 percent? Really? So on a car that cost a dealer $15,000 you will allow a profit of $150, and from that he is to pay overhead, a wage to the salesperson, the lot attendant, the finance manager, office staff... be real, man!
I have yet to go to Hawaii on any one deal. I make an average of $230 on a car deal, so to make a decent living where I live I have to sell at least 15 cars a month (there is a $500 bonus at that level). To do so, I work an average of 55 hours a week, every weekend, and every holiday but Christmas and Thanksgiving.
We work hard. We are well trained, and study to keep up on our own products, as well as those of all of our competitors. We deserve to make a living, and we deserve a little respect. Not everyone can do what we do, especially as well as many of us do it.
We have owned over 60 vehicles so are probably as close to 'professional buyers' as you will get! Recently visited a lot to check out a truck we were interested in. Had done all our homework on it and our iwn. Went back to see the deal we could get. Salesman was fine. The big guy that came in to browbeat us was a different story. From the beginning, we said we weren't going to buy that day - wanted to see what the best deal was. Had seen a truck at another lot and said we wanted to check it out also. Did the test drive and thought they would be looking at our vehicle while we were doing so. Didn't happen. Again, stating there wasn't anything they could do to get us to buy that day. Big guy comes in and literally starts yelling at us. That was it for my husband and we started for the door. He followed and even opened my husband's door to continue yelling. Told us to get our 'fnnn' vehicle off his lot! We have never been treated that way! Needless to say, we will never return to that used car dealer!! I plan to do some reporting on him!