Never rush your decision. If you are completely without transportation, rent a vehicle until you find the right car. When you rush a purchase, you usually end up on the losing end of the deal.
Thanks to the Internet, you can uncover the typical retail cost of a specific make and model. With a little digging, you can find out the wholesale cost as well. This information makes you a powerful negotiator.
You want a win win situation with the car dealership. They need to make some profit, and you need to feel you paid a fair price. It is fair to negotiate to a price that is 500 dollars above dealer cost or about 20 percent off the sticker price. So take along your calculator when you shop.
If the only cars on the lot have expensive options you do not care for, you might want to order a car to your specifications. You might wait a bit, but will save money on options you do not need.
Check with the dealership to see if you can return the car if you do not like it. I did this once. The car I purchased ended up less comfortable than my old car, so the next morning I took it back for my check and my trade in. Many dealerships now offer this option.
You may have heard the advice to shop the last day of the month for better deals. It's true that you might get a better deal from a salesman then.
As far as trade ins go, do your research here, too. Knowing the value of your old car makes it easier to negotiate a better price for it. Try not to talk about a trade in possibility until you get a purchase price.
I researched the value of my little red Corolla and found that it was 3500 dollars. One dealership offered me 1200 dollars because they would have to repaint it. Another dealership offered me 3500 dollars and complimented me on taking such good care of the engine. Stick to your guns when it comes to getting the value of your trade in, especially if you have had your car serviced regularly.
You may want to advertise your older car and sell it privately. Typically you can get a better price this way, but it may take a little time.
A service contract will likely be brought into the negotiation. The consumer information I have read discourages buying an extra contract on a new car, as it is not likely a problem will occur during the first months of use.
Whatever you do, always read the fine print of any contract before signing it. Ask a bazillion questions about what certain phrases mean if you do not understand something.
Simply because the car just rolled off the factory line does not mean you should buy it without asking questions. Keep on your toes during the negotiation process. There is nothing like the thrill of getting a new car and creating a win win situation for you and the dealer.
Do Your Homework
Savvy car shoppers go to the dealership prepared. You can save big with just a few hours of online research.
Before you set foot in the dealership, know exactly what you are looking for and have a general idea of how much you are willing to spend. You will also want to know the vehicle's Base Price as well as the options (and their costs) that are most important to you. You will also want to know the following:
MSRP Make sure you know the vehicle's Manufacturer Suggested Retail Price (MSRP), also known as the "sticker price" or "list price." The MSRP is basically the market value of the car. It generally does not include registration, taxes, freight or destination charges, or other fees that the dealer may add to your negotiated price.
The Invoice Price The invoice price or "factory invoice price" is (in theory) what the dealer paid the vehicle manufacturer. Most cars are sold below MSRP and some even below invoice price.
Why would a dealer sell below the factory invoice price? The stated invoice price often isn't the amount the dealer actually paid. A dealer may get a variety of different discounts and incentives that can make their actual price lower than the "factory invoice price."
While the factory invoice price may not be what a particular dealer paid for the car, the invoice price is the same for all the dealerships, so it's important to know the invoice price so can determine who is giving you the best deal.
Estimated Market Price. A quick Internet search may also provide you with a car's Estimated Market Price (EMP). The EMP is available for a limited number of makes and models and is the estimated price that people are actually paying for the car, based on actual sales made at dealerships.
You need to also pay attention to extra add-ons that may contribute to a higher price tag. Make sure you want or need the extras that you will be paying for. And if the dealership doesn't have a vehicle with the combination of extra features you need, shop around or wait for the vehicle that's right for you.
Shop Around
Don't go to just one dealership and settle. Make sure you have plenty of time to see the prices and available inventory at other dealerships. When you know what other dealerships can currently offer you, you have a great bargaining tool.
Armed with this knowledge, you are ready to negotiate prices. And keep this in mind: Automotive.com reports that a full 25 percent to 45 percent of customers have successfully purchased cars below the factory invoice price (sometimes by thousands of dollars.)
Your down payment is also going to be a big help in your negotiations. If you can use cash as a down payment, it can give you another bargaining chip. If you have a vehicle to trade, you will definitely need to get an idea of its worth before you haggle the trade. And don't settle on this point, either. If the dealer isn't offering you enough for your trade, consider selling that old car yourself and pocketing the cash.
Use everything possible to get the upper hand over the dealer. Remember, as the buyer, you are in control and run the deal. Do not let the salesperson badger you. Know your numbers and stick to your demands.
It's important to not tell the salesperson what you are willing to spend until you get locked into negotiations. Then let them know that you have a certain amount you will spend and if they can't negotiate a deal, you will need to do business elsewhere.
The bottom line: If a dealer wants your business, he'll work very hard to get it. That means you have power. As long as you keep that power, you should be able to save money when buying your new car.
Both Terry Parker & Jamie Jefferson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Terry Parker has sinced written about articles on various topics from Debts Loans, Modelling and Cars. For more information about new vehicles and the needed to service them visit our site.. Terry Parker's top article generates over 246000 views. to your Favourites.
Jamie Jefferson has sinced written about articles on various topics from Fitness, Family Travel and Online Dating. Jamie Jefferson writes for and , where yo. Jamie Jefferson's top article generates over 165000 views. to your Favourites.