New Car Buying Tips

[HatchetMan]

So…you want to buy a car!

Step One: go visit an automobile dealership in your area and select the vehicle that you would like to purchase. Before you leave, take very careful notes regarding options accessories, etc. You will need this information as the basis to conduct your research.

Step Two: call the 800 number at consumer reports to determine how much the dealer actually paid for the vehicle. There is a fee of approximately $14 for this service and it is well worth it. From this point on, you will treat price stickers and dealer invoices as decoration. They will have nothing to do with the actual purchase of the new vehicle.

Step Three: establish your pricing envelope. This is very difficult because of the emotional attachment that comes with shopping for a new vehicle. Then create your nibble list that should include the following: floor mats; felt dice; a full tank of gas, free oil changes for a year, etc.

Step Four: arrange for financing with your financial institution of choice prior to the actual buy.

Step Five: start the actual buying process on the last day of the month. The timing gives you the buyer the advantage because the dealership is charged a fee for every vehicle on their lot at the first of the month. Therefore, the dealership is a little more motivated on the last day of the month verses any other day. If the dealership closes at 9:00 PM start the buying process at 7:30 PM.

Step Six: select your salesperson. The first thing you want to do when entering a dealership is locating their “scoreboard.” Wander around like you are looking for the men’s or ladies’ room and try to find the scoreboard. Once you find it, select your salesperson. You want the person having the best month or the person having the worst month. Ask for them by name. This process works very effectively when you bring your family that creates the diversion that allows you to slip away and search for your prize.

Step Seven: once you have the salesperson you are comfortable with, inform them that you are interested in a particular vehicle. They will ask you to take a test drive. Most people get hurt here because they get in the new vehicle and drive it around and create an emotional bond with this inanimate object. Once the emotions settle in, the buyer’s thought process slows. When they ask you to take a test drive, insist that they go with you. You want to know something about the person you are about to give $25,000 to for this new vehicle. Make them invest time and emotion into the deal simultaneously with you. Ask questions about them personally: “Who’s your daddy?” When you return from the test drive it is now approximately 8:20 PM.


Step Eight: this is the time when the salesperson makes his/her initial pitch. This will take about 10 minutes. It is now 8:30 PM and you should probably talk with the finance person. Make sure that you read the fine print of the terms & conditions to make sure that there is not any penalty for paying off the loan early. It is now 8:45 PM and you need to return to the salesperson.

Step Nine: at this point the push will begin to pick up momentum. This is the point where you work your envelopes that you have prepared along with your nibble list. There will be several trips made back and forth between the salesperson and the manager. Prepare yourself for the most professional version of good guy bad guy that you have ever seen. These people have this concept down to a science. Have the discipline to just enjoy the show for a while. Remember, this process eats up time. It is now 9:00 PM and they are blinking the lights to indicate closing. Hold your ground because you have not met your goals yet. They will push very hard to get you to buy the extended warranty at this point. Keep in mind that none of these warranty programs were designed to help you. They were designed to extract more money out of the buyer. When they push you hard on the extended warranty begin to back out of the deal. Tell them that you are ready to buy this vehicle but since the salesperson is so convincing you are afraid that the vehicle is going to fall apart before you get home. Therefore, the extended warranty will have to be included as a condition of the deal or you are not going to purchase anything.

Step Ten: it is now approximately 9:20 PM and everybody wants to go home. The lizard is working for you now! Once you agree on a price that you can live with move on to your nibble list. Once you have successfully executed the nibble list move into the close mode. Your deal will end shortly past 9:30 PM with new vehicle pick up in the morning.

Avoid too much discussion about trade in value. They will only take blue book value and subtract this number from the sticker price and give you the impression that you received something. If they do not want to buy your car then give it to the Boy Scouts, Salvation Army or any charitable organization and write it off on your income tax return providing you itemize your return. You will receive more value by donating to a charitable organization.

Good luck! :)

[bmcb]

Nice write-up HatchetMan. I'll have to remember this next time.

[clarion]

"....There will be several trips made back and forth between the salesperson and the manager. Prepare yourself for the most professional version of good guy bad guy that you have ever seen......."



i remember that part, i took him about 10 trips to get to my price about right

[SuperGLS]

Point Six is very important, good work. Just curious, are you looking for a new car?

You are missing the most important step. Before going to the dealer you should ALWAYS read about the cars you are interested in (either on their website, auto forums like this one, or in print). If you know more than the salesperson does about the car you don't even need a salesperson. Just go up to them, tell them you want the car for X amount of dollars. They might say "How about I tell you about the car." Then you tell them that you know more than them, and you just need the car. If they agree to the dollar amount say "Ok, now I want it for $1000 less." And see what they say. If they say no, say "Oh, I guess those guys down at Jimmy's Hyundai will get this sale." Then they'll want to sell it to you even more, as losing a sale to another dealer is never good.

[AUTOBOT]

Hahahaha I laugh at the Myths you posted for getting the best deal on buying a car. It is so damn funny when people come in with these expectations of how car buying works. Trust me, I am in the car bussiness and none of this crap works. I will explain why...

Step 1:
Why do at the dealership what you can easily do online more efficiently and from the comfort of your home?

Step 2:
Why call consumer reports and pay $14 for what you can for free online.
http://www.edmunds.com/
Keep in mind this does not include destination charges which are set by the manufacture (not the dealeship) and other fees which you will also pay.

Also, if a dealer shows you a certified invoice, and it is not the actual true certified invoice, you can sue them.

In addition, why do people have such an issue with letting a dealership make profit. If the dealership does not make profit and they close down, where will you have your service done?

(You pay an averahe of 300-400% mark-up on things like clothes every month, and an average of less than 10% on a car but since everyone thinks they desearve more then the next guy we will skip that point)

Step 3:
Hahaha you want everything in for free?
Don't make pathetic lists of stupid stuff like floor mats. I mean the $100 you might save there will adjust your monthly payment by about $1-2 a month. Don't be rediculous.

Step 4:
Is actually not a bad idea, but if you do this, pick one financial institute and no more (preferably your bank or credit union). Then give their finance office a chance to beat the rate. If you apply more then one place, you will ruin your beacon and screw your chance for a better rate.

Step 5:
Last day of the month my ***.
The dealership is not paying a monthly fee on every vehicle out there every month. There is a thing called holdback but I won't get totally into it since it is irrelevant but the manufacturer pays the interest on new cars for 3 months anyways and taxes are yearly.

The best time is to go in to the dealership mid month. This is before it gets realy bussy and since they are halfway through their sales month and have not done much, they are feeling desperate. At the end of the month, it is busier since all the fools think it is the best time to buy and they are less desperate to make the sale. Also, if you still for some reason want to do bussiness at the last of the month, then go in at the 1st or 2nd since the end of the month for sales never ends on the last day of the fiscal month.

Step 6:
Hahaha most "score boards" are not where you can easily find them. I know we don't have ours in the open but if you want, try. Even if you do find it, it isn't like you will figure out the sales person who will give you the best deal. Some sales people sell very little and hold excellent gross and salespeople who sell a lot sometimes do also. The "scoreboard" is completely irrelevant.

Step 7:
We ALWAYS go on the test drive with the customer, it helps us to build value in the vehicle which gives the person an emotional bond to it and to us and helps us to hold gross. Thankyou for that bit of advice.

Step 8:
Why does the test drive end at 8:30? We close at 8:00pm. LOL
There are never penalties for paying early (atleast not here in Ga)
There are simple interest loans where if you pay over, it automatically gets applied to the principal, but otherwise, you just have to write a seperate check to the principal.

Step 9:
What do mean an extended warranty is a bad deal? LMFAO
I told my own mother to get the warranty because it is a good deal.
Every salespeson at my dealership bought the warranty, because it is a good deal. It will never get thrown in for free since their is a high cost in the warranty (they are not free to us). I get a lousy $25 for every warranty sold, do you think it is realy worth me pushing the hell out of it or screwing my mother over it? Get real.

Don't get the warranty on a vehicle that you mod though since you will void it.

Step 10:
Again, hahaha
Late at night, my managers are less likely to make a good deal. They are tired and ready to go home. Sales people and managers have emotions too and they are more likely to make anything happen mid day so they can be done and pick up another customer. At night, we are less likely to want to stick around all damn night for what is known as a "mini" commission.

Step 11 (Donating your vehicle)
Although very admirable, you will not get more by donating it other then points in heaven maybe. Finacially, all you will get is a tax deduction.

Now, since most people still owe money on their vehicle, THEY CAN'T DONATE IT!. Even if it is paid off, you will get more money by trading it in then you will of a tax deduction. Also, here in Ga, you don't pay taxes on the trade amount so you get a tax deduction there too. This means it is better to get them to bump the trade up when you negotiate then by getting them to drop the price of the new car (This is different in some states). However, you might get more by selling it yourself but it is a lot of hassle to do it. Personally, I would prefer everyone sell their own trade because it is less work for me if they do so. But you should ALWAYS atleast see what they are willing to offer or you could be screwing yourself out of money. Just because they make an offer, it doesn't mean you have to sell it to them.

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In your own post, you even said we have things down to a science, do you realy think we have not gotten all these myths on how to buy cars to a science down? I mean seriously, the people that come in with these ideas on how to buy cars usually wind up not getting the car they want or paying more because they have absolutely no clue on how to buy. I will cut much better deals in the beginning to middle of the month just to get a couple under my belt then I will at the end of the month.

People need to realize that they do not desearve the car at invoice. For some reason, everyone has in their mind that it is bad for the dealerships to profit off the sale of the car. Well, guess what, WE ARE THERE TO MAKE PROFIT! That is what bussiness do. People also think there is gobs of profit in cars, well, quess what there isn't. On Nissans, there is on average less then $2000 worth of profit on a car (even less on entry level cars) and usually less the $3k on your high end cars like the 350z and loaded Maximas, Muranos, etc. This might sound like a lot, but when you consider all the people that have to get paid and the rent, utilities, etc, it isn't crap. Everyone makes profit all day long, welcome to America. This does not mean you can't negotiate a little, but get real. If you go to low, you will end up looking like a fool. If you hit a reasonable request, you will probably get it and have a good experience with your purchase.

And the absolute best way to get your best deal on a car is to keep your credit report clean.

So quit reading into these myths and actually educate yourself. Keep your credit clean and make a reasoble offer for your purchase.

Most importantly, DO NOT let any dealership run your credit until you have agreed on numbers.


Point Six is very important, good work. Just curious, are you looking for a new car?

You are missing the most important step. Before going to the dealer you should ALWAYS read about the cars you are interested in (either on their website, auto forums like this one, or in print). If you know more than the salesperson does about the car you don't even need a salesperson. Just go up to them, tell them you want the car for X amount of dollars. They might say "How about I tell you about the car." Then you tell them that you know more than them, and you just need the car. If they agree to the dollar amount say "Ok, now I want it for $1000 less." And see what they say. If they say no, say "Oh, I guess those guys down at Jimmy's Hyundai will get this sale." Then they'll want to sell it to you even more, as losing a sale to another dealer is never good.

Hahahaha
I would say I guess those guys at Jimmies will get the sale.

Like I would ever believe that you would ask a price $1000 higher then your lowest number. I would send you on your way.

The entire car buying process does not work that way.
First off, you ALWAYS test drive the car to make sure you like it and it rides the way you want. If you don't test drive it, I won't take you seriously anyways. Second if you were to actually offer a price and for some reason i agreed to it, and then you asked for less, I would definately not take you seriously. :rolleyes:

[SuperGLS]

Well, you are just one salesperson, and there are plenty out there that aren't you.

I do agree about your points about making money though. I think people just want to pay the least amount possible because they know that it's possible to pay as little as they can. I mean, people can't haggle when they go buy some Nikes, so that's why they just except it and move on. I don't know why the whole car sales business hasn't gone the way of Saturn dealerships (and I think Scion dealerships now, right?). I mean, why can't they just sell them all for a good price. A good price means one that will make them money and one that won't rip the customer off. I mean, all the vehicles are the same (at least, the ones with the same features and options), so why not sell them all at the same price?

Oh, and what I meant when I said that his point six was good is that it is good to find a good salesman and not some piece of crap that can't sell pickles to a pregnant woman (ha, I don't know what the hell that means, haha).

[BlackElantraGT]

Hatchetman, thanks for putting the time and effort into the post. Some of your suggestions are helpful to new car buyers.

Autobot, excellent rebuttal. Thanks for the insider tips.

The mistake that I learned previously and will apply towards my next car purchase whenever that may be, is that next time I will already have a preapproved loan from the financial institution or credit union of my choice. Either that or pay the car in full cash (highly doubtful). Once you work out the deal to the lowest amount possible, you will be the one in control if you already have a check in hand to buy the car. Dealers tend to have a way to "hide" their numbers by giving you your monthly payments instead of the total amount.

[wattsup4800]

what is the minimum you think a dealership would make on a car

[AUTOBOT]

I don't know why the whole car sales business hasn't gone the way of Saturn dealerships

Funny you should mention that.

Saturn makes a higher percentage gross per vehicle on average then ANY other company.

BTW, the no haggle price is on the winshiels of every car dealership but it is the customers who insist on haggling. ;)


what is the minimum you think a dealership would make on a car

Depends on the dealership, the sales person, the sales manager, and they time you happen to hit them.

Sorry, but I can't give you an absolute on that time because it does differ and anyone who can claim they know the best time is absolutely wrong.
I mean if I was 1 car away from hitting a $500 bonus and you were my last shot for the month, you better believe I am battling my manager to drop the price because even though it is $150 mini, it ends up being $650 after bonus. But, the chances of you finding that one salesperson that is 1 car away at closing on the last day of the month is slim.



Dealers tend to have a way to "hide" their numbers by giving you your monthly payments instead of the total amount.

Again, I see somebody that doesn't know much about the car buying bussiness.

How do you budget your bills?
Probably by the month like everyone else.

We don't present monthly payments because we are hididng numbers, we present them because that is what people want to know and for how many months it will be.

I mean a $20,000 car could be as little as $333 a month for 60 months or over $650 for 60 months depending on interest. Now, that being said, what would you want to know? :rolleyes:




Also, people don't be against leasing a car.
Of course if you mod, it may not be the best option but if you are buying a second car for the wife or just as something to drive, it is a great option to save money and to have the ability to walk away from the payments at the end of the term without having to trade in to negative equity. If you buy, you usually have to drive it 4 years before you even break even and your payments are higher then leasing it. People that buy usually drive 2 cars every 10 years and have higher payments. People who lease usually buy 3.5 cars every 10 years with lower payments. Most people are against leasing because they do not understand it. Just be careful of the type of lease you get into. If it is a red carpet lease, run far away. A signature lease is a good lease to get into.

One good tip is wait to the new year rolls in ig you are not too selective on the car. Your choices will be limited but the previous years inventory holds back new inventory. Also, bigger rebates are at the end of the year and lower financing. Stay aya from companies that offer huge rebates. It may sound like a good deal now, but big rebates blow the resale value of the car and cost you in the long run. If you must have one of the cars from a company that offer a huge rebate atleast make sure you getting that rebate yourself by buying at the end of the year.

[Gman]

This by far the funniest thread ever.

Autobot you are a typical salesman if I ever saw one. Yes the dealer needs to make money but all your "boo hoo, poor dealer crap" is getting very old. Dealers don't just make their money from the amount of money they can get the public to pay for a car. The dealers make money in several diff ways, from kick backs from banks for the amount of loans they send over, to bonuses from the manuf for sales totals and selling certain models, dealer advertising bonuses, or even selling you a loan at a higher intrest rate then what you could get approved for. Yes beating up a dealer for the best price does take money out of your (the salesmans) pocket, but to tell the truth I don't care, you chose to be a salesman (I use to be one, and got out) and I had to work very hard for my money and I plan on keeping every dime I can.

You did say one thing I agree with and it is -

Most importantly, DO NOT let any dealership run your credit until you have agreed on numbers.

This not only can hurt your credit score it also gives the dealer the advantage of now selling you a monthly payment not a car.

The whole dealer vers buyer will never go away till they change the laws barring manuf from selling their cars directing to the public, and the only way that would happen is if the manuf bought out all the dealer networks and that could never happen.

[AUTOBOT]

Not typical and not boo-hoo-ing.

Yes, there are several ways dealers make money over the price of the car, I never denied that, infact I think I even mentioned that (not 100% sure but I am not re-reading what I posted).

This is why I mentioned securing outside financing before you go in then allow the dealership to try and beat the rate. Who cares if they make money off financing the vehicle if they still save you some by getting a lower rate for you. Don't you think the finance office deserves a little money if they save you a little?

I actually posted tips on how to save some money. the idea is to go in there with a reasonable offer and not have rediculous expectations on what you should pay for the car. I mean the entire post advice was rediculous and if you go in to a car dealership with those expectations you will set yourself for failure and disapointment. Seriously, just like you, we work for a living and we work hard. If you were actually in car sales (you did say what type of sales you were in) then you would understand that it isn't easy and the amount of work that is involved in making the customer happy. If you go in with stupid expectations, you also waste your time and the salespersons time and make the entire process uncomfortable for yourself.

If you were in car sales, then you probably were not that good (no offense, not everyone can do it). There are two types of people that leave the car bussiness. Those who die and those who suck at it. If you were not in car sales, then your advice is probably derived from myths about the bussiness.

Also, when you buy a car, you should try and buy it at the dealership you plan on getting it serviced at. I know ours (and most dealerships) have a prefered customer status where if you buy a car from us and you are getting service work done, it is cheaper since we give service coupons. You could also get your service work done sooner and loaner cars are researved for our purchasing customers. There are costs involved in that and it is worth something to every customer.

Seriously guys, do your research before you ever go to the dealership and don't be rediculous in your expectations.

[Gman]

Auto, I'm sorry to come off as an ***, I was not trying to say everthing you said was BS, I've just seen you defend the dealership and how little they make on a car sale a few times. You are salesmen as such I commend you, not everyone can go into a job that everyone hates you and thinks you are out to rob them. I was not in CAR sales but did work in a commissioned sales job for 5 years a lot of the same tricks of sales were used, and my comments are not from myths, but from fellow salemen who came from the car side, my father-in-law who is in car sales and my current job where I see the monthly checks that go out to dealers for hold-backs and Adver bonuses.

All these ideas in this thread can work for some and not for others. Autobot has good points and so does Hatchetman, but what it all comes down to is if you want the best deal and If you are going to buy a car, know what the hell your buying before you go in.

The whole car sales world is changing, as consumers we have more info at our disposal then ever before and it is getting harder for the person at the sales level to make it. A lot of the haggle room has cut down in the modern world of incentives and internet sites like Edmunds.com so inform yourself before you go in and with a little effert everyone can walk away from the deal happy.