Getting a good price on a new or used car starts weeks before you actually walk into the dealership.
Get all the current pricing information is the key here. This can help you get the lower price!
For new car: Get its sticker price to the invoice price, current demand for the vehicle to crack a better deal
For used car: The car’s history; like at what price has other buyers bought the car and how many owners the car has had.
Tip: Look for a car which is atleast 2 years old since by then the car’s price can drop upto 50%.
Note: Ask for your car’s Vehicle Identification Number to get the reports and history.
Remember that a bank actually funds the loan, the dealers make money acting as a middleman who gets a commission for signing you up for financing.
Well, You don’t have to finance your car with the dealer, instead you can directly go for any bank that you want. Shop around for different auto loan rates beforehand and they’ll be forced to beat the offer you already have.
Keep an eye on any special financing or/and cash back incentives. When cars don’t sell at the pace that automakers expect, low-interest financing are offered to increase sales. Most likely, you’ll find both kinds of offers on new cars, but certified used cars only offer financing deals. You can always negotiate even after these offers.
Try to shop when the dealership is close to its monthly sales goals. Also, you always have a better chance of a good deal on weekdays, when they can more have time to invest in you. Do not forget to visit multiple dealers to crack the best deal.
During negotiations, remember that unless the vehicle is in high demand, you should not be paying MSRP.
Walk in the dealership with a set price in your mind. Do your research about the current value and price of the car elsewhere and quote the price accordingly. Likely, the dealership makes a profit of around 20% on the used vehicle. Try to leave a little margin around their profit and be confident while quoting their profit percentage. Let the salesperson speak here. Do it all politely and professionally.
Try to find any defaults that might make the car hard to sell. The salesperson here will share his revised price but you should quote a price at 10% lower than what he offered. If the salesperson counters again and again tell him that you have to visit another dealership to look for the same car. But do not forget to share your contact before walking away. You see, they want to sell their lot as soon as possible even with a smaller margin. So expect their call!
NOTE: If you aren’t making progress on negotiation, it’s time to walk out.
For new cars: While the dealership is close to your price, you can ask them to include accessories, such as floor mats, or services like lifetime oil changes; but avoid offers like extended warranties.
For used cars: The salesperson will lure you with add-ons like maintenance plans etc, but you must not accept that. While buying the used car, you should just stick to buying and not getting lured by anything else.
You can get those add-ons elsewhere at cheaper rates.
Don’t forget to get the breakdown of your car after that verbal deal. Here comes the sales contract- The finance and insurance team at the dealership will try to offer you warranties and other products. Yes, you have to again turn down that offer! Also, this is when you can compare any financing offered by the dealer against your pre-approved loan terms.
Make sure you walk out with all the necessary documents and that your financing offer was fully approved by the lender. Don’t let them trick you later into a new finance deal saying that there was a problem with your financing. Because that way they will male you end up with an expensive financing (yo-yo financing scam).
