Top Ten Tricks to Getting a Great Deal on a Car
Besides purchasing a home, buying a car is likely one of the biggest purchases you are likely to make. Likely, you will purchase several cars over your lifetime. So, it goes without saying that it is a big deal and not a purchase you should take lightly. If you are poised to buy your first car or your tenth car, you might not be aware of some very simple tricks and tips to get the best deal.
The hard part is that car salespeople have had a notoriously bad reputation for taking advantage of people or being deceptive. The good news is that things have changed, largely in part due to the vast amount of information you can guard yourself with online.
So, if you are at the point of needing to buy a car, here are the top ten tricks to get a great deal.
Your very best weapon in your arsenal is to do your research before you even step foot into a dealership or make a phone call. Never before have you been able to have a wealth of knowledge about your potential car purchase right at your fingertips. You can find exactly what the car is worth ahead of time. Leaving any guesswork out of the price gives you a huge advantage when negotiating.
What you want to focus on when purchasing a new car is the “invoice” price and not the MSRP. The “invoice” price is what the dealer paid the manufacturer of the vehicle. Knowing this price becomes a great weapon when the negotiating begins.
Now, if you opt for the used car route, there are other considerations to make. You want to look for current resale value (making sure you are entering all the exact details of the make, model and features of the vehicle.) If you have a trade-in, be sure you know the value of that car as well.
Some of the best places to research are:
2. Financing Options
A huge mistake people make when purchasing a car is that they believe the dealership has the best financing options. This might be true, but not always. You want to scope out what your local bank or credit union might have to offer so you can compare your options. You want to get pre-approved so the financing is of no hassle.
In some instances, you might even be able to get zero percent financing. This is actually through the dealership when purchasing a brand new car. Ask ahead of time if there are these incentives for purchasing brand new.
Additionally, you can browse online for financing options. Try websites like lendingtree.com. They can research multiple options for you at once.
3. Don’t Ever Be Afraid to Walk Out
Once you sit down at the table and negotiations begin, you always have the option to just walk out. In some cases, this gives you even a bigger advantage as the dealership sees that you are serious. Let them run after you and offer you that rock bottom price.
4. Negotiate Like a Pro
You must get comfortable negotiating if you want to get a great deal on a car. It can be very stressful and uncomfortable, but there are some key tips to keep in mind:
- Walk in with confidence.
- Try making a low ball offer and then work your way backwards.
- Try to keep your loan term as low as possible. They might offer you a great monthly rate, but if the loan is 60 months or more, it’s really not a great deal.
- Skip ALL the extras. Do not opt for gap insurance, rustproofing, fabric protection, etc. It’s all a rip off.
- Go in with the attitude that this is no big deal. You do not need to walk out with a car today. Leave the table or the building if necessary. Remember, you are in control.
5. Purchase Price Over Monthly Payments
It is easy to focus on your monthly payments and not even bat an eye at the purchase price. This is a huge mistake. You need to read and understand the overall purchase price because car dealers tend to hide in a super long loan term. Opt to keep your loan under 5 years and be extremely wary of any additional costs. You should know the full purchase price up front.
6. Keep Your Trade-In a Secret
Another game to play is to not admit if you have a trade-in. The salesperson will always ask about this and just deny it at first. They can use your trade-in information against you during the negotiation process.
7. Don’t Forget About Car Insurance
Another factor many people skip right over is car insurance. Bottom line, you need it and you need to factor it into your budget. Get quotes ahead of time so there are no surprises.
8. Forgo the Extended Wanted
A wasted expense is buying into the extended warranty. Oftentimes the extended warranty is costly and very limiting. You might not even know what you are getting. Typically, the manufacturer warranty that should suffice.
Also, adding the extended warranty into your financing is a huge mistake. The cost of the warranty plus your interest rate will cost you big time.
9. Visit the Mechanic
When it comes to buying a used vehicle, having it inspected by a trusted mechanic can be helpful. Do this before finalizing the purchase. This should ease your mind and help with any negotiating efforts if need be.
Jumping the gun on a car purchase is never a good idea. You should never enter a car lot without researching, planning and being confident with what you want. You WANT to shop around, walk away from deals and take control of your purchase.
The bottom line is that YOU are in control. Don’t ever be afraid to walk out because there is always another dealer, another deal and another day. The most prepared people get the best deals and you can too.
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