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Negotiating Your Best Deal For Your Car

Posted on 28 August 2008

Before You Go

Make absolutely sure you can afford it.

Don’t get carried away with the euphoria of buying a car. Remember that this is a huge financial responsibility that you’ll have for several years. Gauge your needs and your means, and then narrow down your search to about three models. Remember, after making such a huge purchase, some financial sacrifices will be unavoidable, but you shouldn’t have to skip two of three meals a day to be able afford this car.

Do your homework.

  • Familiarize yourself with every option available on the cars you choose. It’s a lot easier for a salesperson to convince you that you need something if you don’t fully understand what it is or what it does. Then study every other aspect of the car, from the engine to the finish. Become conversant in the technical terms.
  • Look up the invoice price (what the dealer paid for the car, usually inflated by 3% or so) and the manufacturer’s suggested retail price (MSRP) — your offer, the fair price, lies between the two. Keep in mind that dealers are accustomed to buyers’ first offers being below the invoice price. Avoid this crucial mistake, and you’ll show that you’re an educated customer ready to make a reasonable offer. The single best source for invoices and MSRPs is edmunds.com’s “True Market Value” calculator.

Choose a dealer wisely.

You can get each dealership’s Customer Service Index (CSI) from the car manufacturer. Choose accordingly. The right dealer can make all the difference in the world, and ultimately save you money and frustration in the long run. While all dealerships pay the same price for their cars, those with high CSIs may get bonuses from the manufacturer that may enable them to cut you a better deal.

At the Dealership

Choose your salesperson.

Ask to see the fleet manager first. If that fails, ask for the sales manager, and if that fails, pick from one of the salespeople. If you don’t like the salesperson, or get the distinct impression that this person will be unwilling to make a deal, leave and look elsewhere. Remember, if it walks like a shyster and talks like a shyster…

Take a test drive.

Inspect every aspect of the car before getting in. Look at the drunk, slam the doors, hell, kick the tires. Look at the finish, the shape. Can you see yourself in this car? Get in and give it a good beating on the roads. Try it out on residential streets and highways alike. Ask the salesman to stay quiet so you can concentrate, but ask any questions freely. It never hurts to seem apprehensive.

Don’t gush.

You don’t want to come across as though you need this car, even if you do. Make it seem as though you could gladly take it or leave it, then walk into the dealership and start negotiating.

Make a deal.

  • First off, avoid any questions about how you intend to finance the car. Say you’re paying in cash, even if you’re not. Financing can be a big moneymaker for the dealership if the buyer isn’t informed. Stick to the price of the car and deal with financing later, if you haven’t already made an arrangement with a bank or lending institution. The only exception — do your research ahead of time to determine if the dealership is giving you a competitive rate.
  • Make your informed offer, and be prepared for the ‘ol thrust-and-parry. The salesperson will try to get you to go higher, to gush over the car. He may perhaps consult his manager (several times) to “try” to get the best deal for you. The best way to combat these tactics is to seem doubtful or disinterested. Make him work for the sale by removing any sense of urgency.
  • Ask to see the invoice. If he doesn’t want to show it to you, you’re probably about to get screwed.
  • Never let them forget that you’ll gladly go elsewhere if you are displeased with the treatment or deal you’re receiving.

As long as you’ve come prepared, you should get the deal you want. And if you don’t, simply try another dealership. Remember, this is a huge investment, every dime saved helps, and every slip-up can be pretty costly.

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