Car Buying Tips

Why does it take so long to buy a car? Because the car dealer is trying to wear you down emotionally, physically and financially. Their goal is to sell you a new car today for the highest possible profit. They’ll only stop when they feel they’ve squeezed out the last dollar that you’re willing to surrender.

Car buying tips
Buying a new car is an emotionally charged process. You want to do your negotiating from strength, not weakness.

And how do you do that?

Do your research before you start negotiations
Do all the major negotiating on your turf, not theirs
Leverage online sites to negotiate from invoice, not MSRP
Know details about every applicable rebate upfront
Remove financing discussion from purchase equation
Remove trade-in valuation from purchase equation

Where do you stand?
You’re off to great start already. You’ve already done the research, know your credit score, have your financing locked in, have your dealer invoice quotes, and know about all the rebates.

So now you’ll be starting the price negotiation process and you’re going to be doing it from your home or office - your turf.

And, you’ll be focusing solely on the purchase price, not on the financing or your trade-in. Those are separate steps and keeping them that way gives you a tremendous advantage.

Buying secrets:

Maximize your down payment
Minimize your loan term
Always use a credit card to leave a deposit
Never have your car sourced from another dealer
Don’t pay any fees
Never trust the paperwork
Don’t sign anything

Buying secrets explained:

Maximize your down payment - Apply as much to your down payment as you can with a goal of getting 20% down.

This will save you tremendously in interest expense and keep you from being “upside down” on your loan. Upside down is when you owe more on the car than it is worth.

Always use your rebates and trade-in value to lower the sales price. That will save you a bundle in sales taxes alone.

Minimize your loan term - Aim to keep your loan term to 48 months if at all possible. Not only will you save in total interest, you’ll also buy a car that won’t wreck your budget.

There’s nothing sweeter than buying a great car, paying it off in four years, and then being able to drive it from then on with absolutely zero monthly payments.

Always use a credit card to leave a deposit - If something goes wrong with the deal, you’ll have a hard time getting your money back if you paid by check.

On the other hand, canceling a credit card payment is quite simple. Just call the credit card company and follow their dispute process.

If your card company gives you grief, call VISA or MasterCard directly and they’ll reverse the charge in a heartbeat.

Never have your car sourced from another dealer - Too many things can go wrong. Just go to the other dealer and buy it directly from them.

You don’t want to risk possible transportation damage, incur any extra costs and/or fees, or run into any dealer-related scams.

Examples of dealer-related scams include the “missing” MSRP sticker, option mismatch, claims that they’re losing the dealer holdback fund,

Don’t pay any fees - We have an entire Section entitled Don’t Get Fleeced by Fees.

Fees are one major way that a dealer reclaims any profits lost in the negotiation process. Most fees are double-dipping or tremendously inflated over the actual cost of the service.

There are only a few legitimate fees and even those are negotiable. In the negotiations, dealers will claim that certain fees are sacrosanct.

They have a self-run profit center that loves to call anything they can a “fee” because most people will never try to negotiate a fee or protest one being imposed.

Dealers will even claim that the factory requires them to charge you these excessive fees. We all know that’s a load of hooey.

Fees are never mandatory and are always open to negotiation.

Don’t believe them for a minute!

Never trust the paperwork - “Mistakes” happen. And sometimes they happen on purpose!

Check the math with a calculator. Make sure that every line item is correct and that everything matches exactly with your written quote.

Draw a “Z” or an “X” through any blank spots and have both parties initial those.

Once you sign, you’ve agreed with everything the documents say, even if they are packed with things you didn’t order, include excessive fees, or contain math errors that have added hundreds of dollars to your total purchase price.

Don’t sign anything - Knew I’d get your attention with that one!

Actually, don’t sign anything without reviewing all the numbers and checking the contract language.

When you sign, you are agreeing that you have read and understand the contract documents. Once you sign, you are committed to what’s in writing.

Any verbal commitments from the dealer don’t mean diddly.

If there’s anything wrong with the car or the paperwork, it’s now your responsibility.

And never sign an acceptance certificate without completing your inspection checklist and test drive!

No Haggle Dealers
The concept of a “no haggle” car buying process appeals to some people who haven’t thought everything through.

No haggle is no deal 99% of the time. The dealer puts prices on the car that reflect MSRP less consumer rebate and claims to be giving you a great deal.

Wrong! You just paid list price for that car.

No haggle gives the perception of a deal, not the real thing. The no haggle dealer will keep all consumer rebates, all factory incentives, and never come close to selling you a car at dealer invoice.

They claim to offer no sales pressure in return, but in reality their sales people are still expected to meet sales quotas.

You won’t be getting a “no haggle” deal on your trade-in or financing either. Both these profit centers are stacked firmly in the dealer’s favor.

And one more thing - Any options you want are added on at list price. Remember it’s no haggle, right?