So, you have looked at the reviews and images, read about the features, checked out performance ratings, maybe even taken a test drive or two, and you have now finally chosen the car you want to buy. The next step is the all-important negotiations with the car dealer so that you can get the car without blowing your budget. How do you do that?
Secure Vehicle Financing Ahead of Time
Visit your local bank or credit union and secure the financing you will need before heading to the dealership. Car dealers make a high percentage of their profits by financing deals. You will save a significant amount of money by financing through a reputable financial institution, not through the dealership.
Obtain Quotes From Several Dealerships
Before settling on a dealership, visit several to get the out-the-door price of the vehicle you want. Having these figures at your fingertips will help you to get dealers to compete for your business, giving you an edge when you go to the dealership.
Time Your Visit to the Dealer
Don’t visit the dealership when you are rushed or over-tired because the negotiations shouldn’t be rushed and you need to be alert. Go to the dealership on weekdays because on nights and weekends a large number of customers might make it harder for you to negotiate because the salesman won’t be as focused on you.
Look at the Invoice
Before you start any negotiations, ask to see the invoice because it will give you a lot of information on the car and, importantly, what the dealership paid for it. Although the dealer must make a profit, you’ll have a sense of the profit the dealer is trying for.
Remember You Can—and Should—Say “No”
You are in charge. Don’t allow the dealer to force, rush, or sweet talk you… and he will try! Be prepared for those tactics and be ready to say “no” to a price or deal that you don’t like. You should even be prepared to walk out if necessary.
Make the Dealer Be the One To Make the Offer
If the dealer asks you how much you’d like to pay, don’t name a figure. The dealer asks you how much you are able to pay: side-step the question. If he wants to know what you are currently paying: be honest. The bottom line is not to give a figure you are willing to pay as it might be higher than the one the dealer had in mind and he won’t tell you that! You need to get the dealer to name a figure and then negotiations can begin.
Tell the Salesman You Already Have Financing
It is crucial that you don’t—under any circumstances—tell the dealer or salesman that you have pre-arranged financing until the price is negotiated and agreed!
Final Buyer’s “Do’s” and “Do not’s”
Firstly, establish that you are a serious buyer that knows what he/she wants: “I’m thinking about buying a Ford” versus, “I want to buy a Ford Fusion with certain extras. I’ll buy it where I get the best price”. Secondly, don’t raise the issue of a trade-in prematurely as it can complicate matters or shift your focus from the price. In addition, don’t discuss any incentives or rebates until you have agreed on a price. Finally, try to negotiate the dealer fees and don’t get bullied into extras like warranties.