Whether you are looking for a convertible or a fuel-efficient van, buying a new car can be a daunting experience. In an ideal world, a dealer will help you find the perfect vehicle for the right price. However, with such a big emphasis on profit margins this is not always the case. Going to purchase a car with your eyes open is important to avoid some of the potential pitfalls.
Do Your Research on Car Prices
Many car dealerships prey on people who are unprepared. Going to a car showroom without doing preliminary figures and gathering key information gives the salesperson complete control over your buying process. Read reviews, research your choices and check out features such as fuel economy, safety and reliability. Get a general idea of your desired car’s value, as well as the potential value of your current vehicle if you plan to trade it in.
Strike a Deal
To achieve the lowest price, try to go with the price the dealer paid for the car, not the price displayed on the sticker. Dealer invoice pricing is available on the Internet as well as in pricing guides. Check quotes at auto-buying websites—these no-obligation services are free. You can then try to get a lower price by negotiating effectively in the showroom.
One Thing at a Time
Your salesperson will probably mix trade-in, leasing and financing negotiations all together and will also prefer you to negotiate a monthly payment figure. This gives the salesperson the chance to lower the figure in one area while inflating it in others. Negotiate each thing separately; remember you are in charge and can leave the showroom at any time. Sometimes deciding to leave can bring a lower offer to the table.
Advance Car Financing
Before visiting the showroom, compare interest rates at several credit unions, banks and financial institutions. Having preapproved finance means you can keep financial arrangements out of the negotiations. Bear in mind the salesperson may try to sign you up for higher-rate finance. You should also avoid a temporary low-interest rate, as this often changes to a sky-high rate.
Avoid Unwanted Extras
Dealers will do their best to sell you extras such as fabric protection, vehicle identification number (VIN) etching and rustproofing. Do not agree to these unnecessary fees and services. Vehicles are already coated to prevent rust, and you can treat your car’s upholstery yourself using inexpensive treatment available in auto shops. You can also do your own VIN etching, which usually costs less than $30.
