Buying a new car demands keeping your cool in the face of many car dealer manipulations. Before leaping into this major purchase, spend some time reading, researching and talking with people about different new car models, methods of purchasing and experiences with new car ownership. As in any negotiation process, enter the car lot with a positive attitude, but be prepared to leave without the keys in your hand. Knowing you can walk away from the deal means that you hold the power during the haggling.
Avoid falling in love. Do not set your sights on the car of the moment or the trendiest thing on wheels, or you may find yourself in a situation in which car dealers have waiting lists of people willing to pay sticker price or even ratchet the price higher. If you just have to have the latest and greatest model, wait until consumer interest cools down before trying to bargain for it.
Research your desired car model's stats. The Edmunds.com guide, "Negotiating 101," reports that knowing your car's invoice price, which is the base price paid by the dealer to the manufacturer, can save you up to $1,500 on most new cars. In addition, sometimes manufacturers offer dealers special incentives such as hold-backs and rebates, further lowering the new car's base price.
Procure your car loan. If you do not plan to pay cash for your wheels, at least avoid using the car financing at your dealership. In many cases, dealers roll fees into the financing process, making your bottom-line price not as cheap. Line up your funds up front by inquiring at local banks, credit unions and online banks, so that you can make a clear-cut deal at the car dealership.
Bargain with the car's invoice price. Once you know the invoice price, essentially the price the car dealer paid the manufacturer, you have your starting point for negotiation. You can offer the base price and set a goal of not bargaining upward past 5 percent of the invoice, or even less if the car model is less desirable or you shop in the slow season. If you and the dealer cannot settle on a final price after this process, you can either leave the car lot or attempt to negotiate via the dealership's internet department.
Watch out for surprises. Once you finish haggling over price, you may find yourself surprised by a laundry list of add-ons, such as taxes, licensing, destination fee and registration. You have a right to know every fee and its exact amount, and should get this information in writing before settling on a new car price.
- Time your car purchase so that you shop at the end of the model year and during a less busy time of the week.
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