The best new car buying advice you can get is how to buy a car for the lowest possible price. Think of the car-buying process as making a deal. There’s back and forth involved, but you are the customer-and therefore in the best position. Here are some things to consider before you speak to the car salesman.
Don’t Talk Monthly Payment
Salesmen will talk about monthly payment: How much do you want to pay a month, what’s the most you can pay, the least, etc. This is only serves to distract you from what should be your focus-the purchase price. When you hear that you can get into new autos for $500 a month, you don’t know if that’s for 48, 60 or 72 months. In fact, the monthly payment can be all over the place. New car buying advice to keep in mind is to concentrate on lowering the sticker price and saving talk of monthly payments for the financing stage.
Keep Trade-In Discussion Separate
Whether you have a car to trade in or not, it’s best to keep this discussion for after you’ve settled on the purchase price of the new car you’re interested in buying. Naturally, you want to get the most for your trade, but if you get that up front, there’s no incentive for the car salesman to budge on your new car’s sticker price.
Get Pre-Approved Financing
New car buying advice on financing is to get pre-approved before you go to the dealership. Check with banks and credit unions for the best deal or go through a car loan broker. Why? Dealers make money on customers who use their financing. It might be a good strategy to say you may consider dealer financing, if you’re asked, and then later say you changed your mind. As long as the car salesman thinks you might, there’s more incentive for him to move lower on the car’s sticker price.
Mum’s the Word on Cash Payment
New car buying advice experts recommend that you never mention paying cash’at least at first. Dealers make money through financing. If they know you’re paying cash, there’s no money to be made and they won’t be likely to reduce the sticker. Save mention of cash payment (or down payment) until the financing stage.
Never accept sticker price as purchase price. This is just the starting point in negotiations between you and the dealer. Let the salesman begin the discussion. Many new car buying advice experts say the first person mentioning sticker price loses. Know ahead of time what the dealer’s profit margin is on the vehicle (usually between $1,500 and $3,000 on a $20,000 car). This is your negotiating room. With rebates and dealer holdbacks factored in, you should be able to buy your new car below dealer invoice price, but don’t be afraid to walk. The salesman wants to close the deal, and this may be your best time to get the lowest possible sticker price, and if not, there’s always another dealer.
Car Leasing Advice
Know whether you’ll lease or purchase. New car buying advice on leasing is to inquire about vehicles with special leasing deals. The best leases are cars with high resale values. You can also get a more expensive vehicle with a lease than a purchase. Still, you need to negotiate to lower the sticker price.
Car Warranty Advice
Don’t forget that new cars come with extensive manufacturer warranties. You don’t need extended vehicle warranties the dealer will try to sell you.