How to Deal with Car Dearlers

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By Sherry Luna
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Deal With Car Dealers

Dealing with car dealers! I am a strong believer that knowledge is power and this is a perfect case of knowing beforehand can save you hundreds of dollars.

There is a difference of "buying" a car or being "sold" a car. When you buy, then you are in control. You know exactly what you want and what you are willing to pay. While being sold a car leaves the dealer with the control and more tricks to use to get more of your money. In order to be successful at shopping for a car, you need to know exactly what kind of car you want to buy.

I hope you keep these in mind the time you shop at the dealers for your next car.

Difficulty: Moderate

Instructions

Step 1

Price Nudging. This can happen very quickly during negotiations. The auto dealer salesman pulls out a 4 square sheet of paper where he list information such as; purchase price, down payment, monthly payment, and trade-in value. Take time and focus on one item at a time here. If he feels you are busy thinking your getting a good price on your trade in, he may nudge the price of the new car north.
Step 2

Deal With Car Dealers

Stayed focus on the price and don't answer any questions on how much monthly payments you can afford. The salesman may factor in a large down payment or stretch the life of the loan 60 or 72 months. Also if you discuss monthly payments, in the mind of the salesman, you have just committed to that amount as your monthly payment.
Step 3

Don't go to the dealer on a empty stomach. Besure to eat a good meal, shower, and dress comfortably. Many of the tactics used by car dealers is to stall and keep you there to wear you down. If you are not ready to haggle, then your emotions may end up costing you more money. You'll want to just hurry up and get out so you'll end up agreeing to about anything they offer.
Step 4

Don't negotiate down from the sticker price(the amount they want you to pay), but rather negotiate up from the factory invoice price (that actual price the dealer paid for the car). All car dealers pay the same factory invoice price. Car Dealers usually earn between 10 to 20 percent on each car they sale. So take the invoice price and add an additional five percent and present that as an offer, stand firm on that amount.
Step 5

Deal With Car Dealers

Factories sometimes provide car dealers with special incentives called Holdbacks to help push not-so-hot selling cars. With these extra incentives, dealers maybe able to sell below factory invoice. You will have to ask about these incentives, because they won't want to tell you about them.
Step 6

It is a great idea to price shop before you go to the car dealer. You can do this by phone rather then going directly to a salesman. Call around to a few local car dealers and get some competitive prices. It is important to know what the going rate is. You can also use websites such as InvoiceDealers.com, Cars.com, and Edmunds.com Below are more links listed. Use them to lookup how much dealers are paying.
Step 7

Deal With Car Dealers

Don't pay for extra add-on that you don't have to pay for. You will have to pay for taxes and registration, of course. But other stuff such as rust proofing, or paint protection are not required. You can flat out refuse to pay them, or you can negotiate the price down if it is something you do want.
Step 8

Use the "buddy system" when you go shop for your new car. A friend with an objective eye can help you see if you are getting pushed around. Plus they can be a witness to whatever is being said.
Step 9

Deal With Car Dealers

Beware of signing any papers that contain the words "subject to bank approval", or anything similar to those words. It only takes 15 minutes to check on financing. This is a trick used by car dealers to enable you to drive off the lot with the car, only later to call you back in and tell you that your loan was not approved and you need to sign for another more expensive loan or bring in more money for a larger down payment. Don't fall for it! Only drive off the car lot when ALL paperwork is completed.
Step 10

Have your financing approved by a bank or credit union before hand. Online financing is also a great way to go. Website sites such as Up2Drive.com offers lower APR rates than most banks and can approve you online within minutes. Provided below is a link to their site.