If you're ready to trade in the car you've been driving since college and upgrade to something brand new, you may be wary of wheeling and dealing car salespeople who are waiting to rip off inexperienced buyers. Luckily there are steps you can take to avoid scams and get the best deal. Doing your research, knowing how to negotiate and avoiding extra purchases are just a few of the ways you can snag your dream car at a great price.
Research and decide on a vehicle. Read reviews to determine the safety, reliability, fuel usage and cost of models you're interested in. If you’ll be trading in your car, know how much it's worth as a trade-in. If you go to the dealership unprepared and without information, the dealer can easily control the buying process in his favor.
Determine your starting price. Getting the best deal on a new car requires smart bidding. Look at auto-pricing websites such as Kelley Blue Book or Edmunds.com for the dealer invoice price to help determine how much the dealer likely paid for the vehicle. The sticker price does not represent what the dealer paid. Consumer Reports recommends beginning negotiations at one to five percent above the dealer invoice price.
Determine financing in advance if possible. Compare interest rates at a variety of banks and loan organizations before looking at the dealer’s rates. Apply early for a loan to keep financing discussions separate from vehicle negotiations.
Visit the dealer during off hours. Visiting on weekends or evenings when other customers are around makes the dealer less likely to spend time negotiating a great deal. Visit on a weekday afternoon when the dealership is mostly empty. The dealer will have more time to negotiate with you and is more likely to give you a good deal to make a sale.
Set limits with the dealer. Let the dealer know that you’re looking for the lowest possible markup above your initial offer. Notify him that you will be visiting other dealerships to find the best price. If you’ll be paying cash, don’t let the dealer know this until you have a price in writing. Dealers often profit on financing, so if they know you won’t need it, they’re less likely to give you a great deal on the vehicle price.
Negotiate financing, trade-ins and price individually. Many dealers will try to lump the prices of these items together and ask you to negotiate by monthly payment. In reality, they may be offering you a good deal in one area and overcharging you in another to increase their profits. By negotiating each item separately, you can get the best deal in all areas.
Head for the door. If the negotiation isn’t going anywhere, attempting to leave can make an eager salesperson more willing to offer a lower price.
Avoid purchasing unnecessary items. If a dealer tries to sell you cleaning or rustproofing items or VIN etching in your windows, just say no. It will be cheaper to purchase any of these items on your own.
Megan Martin has more than 10 years of experience writing for trade publications and corporate newsletters as well as literary journals. She holds a Bachelor of Arts from the University of Iowa and a Master of Fine Arts in writing from The School of the Art Institute of Chicago.