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Pea-n-Me
01-25-2012, 09:15 PM
Speaking of buying cars.... things every buyer needs to know to even out the playing field... ;)

"Confessions of a Car Salesman" Updated for 2009 (http://www.edmunds.com/car-buying/confessions-of-a-car-salesman-updated-for-2009.html?mktcat=ob-national&kw=confessions+salesman+updated&mktid=ob61215973&msite=w)

NYEmomma
01-25-2012, 09:26 PM
I remember reading that entire story a few years back when we were in the market for a car. SOOO interesting! I mean, I was hooked on it like it was one of those trashy vampire novels that I read. :rolleyes1

I'm in the market for a new vehicle now and our position in the whole game is a lot worse than it was before, making it even more difficult to find what we need in our price range... and every time we walk out of a dealership disgusted by the entire buying process, I'm reminded of this story.

Pigeon
01-26-2012, 10:06 AM
We bought a new car last month and I was suprised at how pleasant it was at the dealership where we bought. We did a ton of research first and decided on the model and the trim line.

I first asked for internet quotes from four local dealerships for a certain model at the base trim line.

One of them responded with a quote for what I asked about. It was a really good price, but did include one small incentive that we were not eligible for (but I suspected this and clarified with him right away).

One responded with a quote for a higher trim line. Two responded with an invitation to come in and test drive but no quote. I replied to these three by asking them a second time if they were interested in answering my question or not. One did, but the quote was higher than the first dealer, the other again quoted a different trim line, and one just kept asking me to come in.

We visited the two dealers where we'd gotten the quotes we were looking for and talked more. There were a few different incentives or a zero percent finance deal. We found out what each dealer would give for our ten year old trade in.;)

We ended up getting the car from the first dealer who responded with the appropriate quote, and were very happy with the process. There wasn't much pressure and very little BS. He was pleasant and professional. We love the car.

I would do it this way again, but I would stipulate when asking for the original quote for them to itemize any incentives and list eligibility requirements, like new grad, military or repeat customer.

thebeesknees
01-26-2012, 10:51 AM
Good stuff! We are in the market for a new car here in the next couple of months and I've been reading everything I can to better educate myself before we walk onto the lot.

ktlm
01-26-2012, 02:36 PM
Good stuff! We are in the market for a new car here in the next couple of months and I've been reading everything I can to better educate myself before we walk onto the lot.

Here are my recommendations which I have used myself to success. (My DH has told me, his plan is to not say anything and let me negotate because I always get the price I want)

If you are buying a new car it is easiest if you go to the dealership already knowing what make and model you want. If you don't, then see if you can narrow it down to a few makes and models you are considering. Before you ever set foot in the dealership, get on the internet and do research. Go to the Edmunds website, Kelly blue book, or I think there are a number of others (I usually do a couple to make sure the numbers match up). Price the cars with the options you want. There will be invoice, wholesale and retail numbers. Pay special attention to the invoice amount (never believe a factory "invoice" the dealer gives you- they are dummies and aren't accurate). Then you go to the vehicle manufacturer's website and see what rebates and deals are going on. (i.e. if the dealer is getting a $1000 rebate, then you know they paid $1000 under the invoice for the car) Once you have a decent idea of the dealer cost, then you figure out what you want to pay for the car. You know the dealer has to make some sort of profit. I have seen websites that say you should shoot for an additional 5% of the dealer cost. I have also seen websites that suggest offering $500 over invoice (minus any rebates etc. )for cars under $20,000, $1000 for cars between $20,000 and $30,000 and $2000 for cars over $30,000.
Me, my number on a new car is usually to give them $1000 profit- and I have done that on cars over $30,000 with success. Don't tell them you have looked at the invoice or anything like that..believe me when you play hardball they will figure it out. Also, they will push you for what you want to offer for the car or for what you want your payments to be. NEVER fall for the "what do you want your payments to be line". As far as what you want to offer, I ALWAYS make them put forth the first number. I tell them, I want to know what you are going to sell it to me for. You tell me a number and I don't like to play the negotiation game for hours to lets cut to the chase. They always try to push me to give the first number, and I always hold out until they do. More often than not, I get a number that is not too far off from what I'm wanting to pay, because they have already figured out by me acting that way, that I'm not going to be a pushover. If I get a salesman that gives me a ridiculously high number, I usually give him "the look" and say something like "really?" and "yeah- no. I know that isn't in the ball park" and if I'm really irritated I might even say "If that is the way you want to play it then maybe I need to look elsewhere because you and I both know that number is way too high for this car". You just kind of have to play it by ear from there. If they really sense you mean business, they might even give you the number you have in your head right away. If they give me a decent number not too far off from what I want but too high, I might flat out say- "Well here's what I want to pay- if you can do it for that, I'll buy it right now." If they come back with a different number I tell them "I gave you my number. If you can do it for that great, we have a deal. If not, I'm not buying today". If they insist on giving me ridiculously high numbers, I either counter with ridiculously low numbers or walk out because that salesman obviously doesn't know how to make a deal. You can't ever be afraid to walk, even if it is the only dealership in that town for that model car. If you are walking out and they are the only dealership in town for that model, as you leave hint that you think you can get a better deal on the internet from a dealership in a different place for the car etc. Don't specifically mention what town or what dealership.


For a used car, it is harder because you never know what they have paid for it. Again, you need to go in knowing the possible makes and models and you need to price them out with options on the internet before ever walking into the dealership. If you have no clue what make or model you want and are just shopping around, then once you find a car you are interested in, don't even start to work on making a deal until you have left and done your internet research. When you price them you will see trade in, wholesale/private party, and retail prices. You are shooting for around the wholesale/private party price. Again, know what the car is worth and what you want to pay before you start negotiating and then go through kind of the same procedure as above (don't ever fall for the payment line, and try to get them to make the 1st offer so you know what kind of salesman you are dealing with). Don't be afraid to walk if they are not going to give you the price you want. Even if you love the car, you will find another car you like just as much. Also, even if you walk, if you have gotten to the point where they have your contact info it is not unusual for them to call you the next day and lower the price. One good option is that many dealers have their used car inventory on line where you can search it. You can get quotes E-mailed to you for the specific cars. In my experience, the quotes are generally pretty decent because they know if they aren't, you won't ever set foot in the dealership. Also, always have them run a car fax on the car at their cost and get a copy- that is kind of a history of the car and sometimes it has enough information to see if there are any major problems. We once found out a car we were looking at had been serviced due to flood damage. We no longer were interested in that car.

Good luck!

PatMcDuck
01-26-2012, 03:43 PM
My son is a car salesman. :rolleyes1


The BEST advice I can give you is to get your own financing. Period. :thumbsup2

Jeff_G
01-26-2012, 08:18 PM
Here is how I bought my new minivan,(would probably never purchase a new vehicle again too much depreciation).

After all the research and a test drive of the minivan model we were looking at I emailed all the dealers in the state asking for their best out the door price for the specific trim and color minivan. Two or three dealers actually gave me what I wanted a final out the door price with a breakdown of all the fees, other responses I received back were comical!

“We only sell vehicles at MRSP…” “We could come down $3,000 to MSRP…” “You will not find anyone in the entire state selling this vehicle below MSRP…”

(I forwarded that last guy the best out the door quote I had received)

I received several more come down and test drive with no quote or price mentioned.

So I took the best out the door quote compared it to what I believed I should pay from my research and told that dealer I would purchase.
They emailed back asking me to give them a call the next day, they went over and confirmed the options I wanted and the price, the vehicle in question was en-route from the factory via rail (ie train). It was going towards another dealer and they would trade that dealer another model minivan (common practice for this car manufacturer). They then took a small $200 deposit via credit card (which I knew I could dispute later on if needed). The van would be in town a week later.

The day the van was due to arrive the dealer called me to let me know it was in town and a time to swing by to pick it up.
I drove to the dealer with my financing in hand, upon arrival the van was parked right out front washed and clean, we looked it over, took it for a test drive to confirm everything was working ok. We sat down signed the purchase agreement, and a few other required documents, handed over my check and took the keys. Total time spend in the dealer was less than 1 hour. It has to be the easiest purchase I have ever made for a vehicle…

thebeesknees
01-26-2012, 09:14 PM
Wow - thank you all for all your advice! I am getting quite an education from all of this and just wanted to say again how much I appreciate the time you have all taken to try to help those of us who don't have a clue what we are doing!

goofyredraider
01-26-2012, 09:30 PM
My son is a car salesman. :rolleyes1


The BEST advice I can give you is to get your own financing. Period. :thumbsup2

As is my husband. :rolleyes1

MSLRAC
01-27-2012, 08:29 AM
My son is a car salesman. :rolleyes1


The BEST advice I can give you is to get your own financing. Period. :thumbsup2

Why? I work in finance and with decent credit, I can beat just about any rate that most banks and credit unions are offering by multiple points and I usually accomplish that with $0 down and a reasonable term (36-60 months). Manufacturer finance companies rarely allow dealers to bump rate, so usually the buy rate is the rate we contract at (I've not had a loan that I could bump in well over a year). They also limit the fees that dealers are allowed to charge and will return contracts for adjustment if we go over those fees.

There are also some perks of dealer financing. We are a special level of Honda dealer so American Honda Finance will buy deeper for us than they will for other dealers. It's not that they are buying bad loans but they are giving a chance to first time buyers with no credit, buyers with limited credit and buyers rebuilding their credit. So many times, we have been able to get people bought that their bank or other dealers could not.

So dealer financing is not bad in most cases and I personally think that you should at least consider it.

NYEmomma
01-27-2012, 08:54 AM
Why? I work in finance and with decent credit, I can beat just about any rate that most banks and credit unions are offering by multiple points and I usually accomplish that with $0 down and a reasonable term (36-60 months). Manufacturer finance companies rarely allow dealers to bump rate, so usually the buy rate is the rate we contract at (I've not had a loan that I could bump in well over a year). They also limit the fees that dealers are allowed to charge and will return contracts for adjustment if we go over those fees.

There are also some perks of dealer financing. We are a special level of Honda dealer so American Honda Finance will buy deeper for us than they will for other dealers. It's not that they are buying bad loans but they are giving a chance to first time buyers with no credit, buyers with limited credit and buyers rebuilding their credit. So many times, we have been able to get people bought that their bank or other dealers could not.

So dealer financing is not bad in most cases and I personally think that you should at least consider it.

We always get pre-approved from our lender (USAA) before you go shopping so we know what rate we could finance at. We've got excellent credit and have been with USAA forever. They practically own us, lol. But probably 75% of the time, the financing offered by the dealership is better thanks to special rates and stuff.

MSLRAC
01-27-2012, 09:04 AM
We always get pre-approved from our lender (USAA) before you go shopping so we know what rate we could finance at. We've got excellent credit and have been with USAA forever. They practically own us, lol. But probably 75% of the time, the financing offered by the dealership is better thanks to special rates and stuff.

Stuff...what stuff? When you are dealing with the exact same numbers, what makes one finance offer better than another is difference in rate, term and/or down payment.

Manufacturer finance companies offer standard rates and special rates all the time. The bottom line is that those rates are lower in most cases than that of other finance options that customers have. So a smart consumer would go with the better loan. Would you sign with USAA at a higher rate just because the dealer's finance rate was 'special'? Is so, that makes no sense at all! Why pay a higher rate just because USAA 'owns' you?

hsmamato2
01-27-2012, 09:08 AM
The BEST advice I can give you is to get your own financing. Period. :thumbsup2

not always....:confused3 in our case we researched for months, looked at every option, ended up contacting a few dealers asking for what we wanted- when 2 actually answered our question with an answer rather than a 'come on down' we visited to buy-
on that day we knew their inventory,knew what we would pay,and test drove.
we told them all of this, and told them to give us a price. No nonsense,we weren't interested in becoming friends. And we didn't care what they thought we 'could' be paying.
**They gave us a great offer, and we took the dealer financing b/c it was so incredibly low, it was lower than the national advertised specials.:thumbsup2 **
All in all, we got a great car at a really good deal, with 4 miles on it. (turns out this new car was so close in price to all the used models we'd considered that it made made $$$ sense to go new!)
We were both amazed by how simple and easy it all was......
Oh, we didn't tell them how we were paying till they gave us a quote on price......;) but since we have good credit,and they knew we were buying FAR below what our 'income guidelines' showed,we could easily walk away to the next dealer,and we would,if pushed.

kelleigh1
01-27-2012, 09:25 AM
I'm expecting to purchase my next car by the end of the year. And I plan on spending the next several months doing lots of research so I get exactly what I want. I might just have to copy and paste the info from this thread for future reference.

With my last purchase, I probably didn't do enough research, but I knew enough to walk away from one (so-called) deal. We looked at the car I wanted and when the salesman told us the figures, I thought he was way off. I had already told him that my BIL was a salesman in another state and that I wasn't going to get screwed. He apparently didn't believe me. So when he gave me his first figure and the monthly payments, I said no. He told us to take it for a test drive and see if it was what I wanted anyway and he would "talk to his manager". Red flag right there.

So we took the car out and I told my husband that while I liked it and it rode well, so I knew that it was what I was looking for, there was no way I was going to buy it from them at the current price. So we bring it back and the salesman comes out with another figure and a monthly payment $100 less than the earlier quote. Ok, $100 times 12 months over the loan terms was a whole boatload of $$. So I asked him how he came up with that new figure. He said "it doesn't matter how I got there, just that I did. And if you walk away now, that deal is off the table." I said goodbye and walked away. I had reminded him that my BIL was a salesman and I suspect that he didn't want me talking to him but was hoping I'd cave and sign the papers right then. Nope - didn't happen.

Sheaboys
01-27-2012, 09:36 AM
We bought brand new in 2007. We knew exactly what we wanted, we knew the price we could pay monthly.

We bring our kids, yes folks at that time it was 4. I waited in the van with kids, while DH went in to discuss what he was looking for. He came out 2x with prices that the salesman gave him (monthly payments), while dh knew I would say absolutely not, he said, let me check with my wife. First price was $550 a month, not unless it has a bathroom, am I paying that per month. Next time it was $400, still no. I said, I was willing to to $350 that was the max amount.

We have excellent credit, so we got a great rate, he was able to meet our needs, we would have a bought a van with bare minimum stuff, but ended up with some bells and whistles.

Once we agreed on a payment, I went in the kids to get the paperwork settled, then took a quick and I mean quick test drive. They wanted us in and out of that show room. :rotfl:

We did research the van we wanted for months prior to actually hitting the sales lot.

Pigeon
01-27-2012, 12:39 PM
My son is a car salesman. :rolleyes1


The BEST advice I can give you is to get your own financing. Period. :thumbsup2

Sometimes yes, sometimes no.

With our recent purchase, we found the best financing we could on our own. It was pretty low and we went in pre-approved.

We negotiated the price on the car. The dealer had a few different incentives, one of which was either cash back or a zero percent rate. We ran the numbers both ways and it was cheaper for us to take the zero percent rate financing than to get the loan from the credit union and the cash back incentive.

It always pays to go in armed with all the relevant information and look at the numbers.

mrodgers
01-27-2012, 01:09 PM
I get supplier pricing on everything, that's the way to do it, LOL.

They get upset when you show up with a supplier discount. My best discount is with Nissan. Dealer laughed at me and my worksheet and said he can beat it. He came back with the figures from himself with a bunch of factory incentives and my worksheet in which he didn't fill out correctly. "I beat you by $500!" He exclaimed with a smug look on his face. I pointed to the worksheet and showed him where he should have applied the same factory incentives, which were about $4000 as well as some other stuff that was wrong.

When it was done, $19,900 sticker price, his price was $15,900, my discount was just about $12,000 brand new. He got me out of there by not budging beyond $800 for my $5000 trade vehicle that $3000 was still owed on.

ccgirl
01-27-2012, 01:14 PM
Best advice I have is to research.

Research your credit so you know your credit risk. The lower the risk the lower the rate and the easier the loan process will be.

Research the going rate for car loans in your risk. I have found that if your risk is low car dealerships will be able to match what you could do for yourself for the financing and save you that time. I know I have driven by car lots with the windows painted, "we can finance you with no money down for 12%". Umm...yeah....no thanks.....

Research the car you want. Know what the MSRP is. If you want options, know the price of those. Car dealerships are there to make money just like other businesses. They are not going to give you a new car for 10,000 under MSRP no matter how good you think your negotiating skills are.

If you are trading, know the value of the trade.

Personally, I don't mind paying what something is worth. My DH lets me do all the talking. With the purchase of his last car, I got on my phone as we were test driving and pulled up the KBB value. It was $1500 over what they were asking. So, I told them to knock off the $1500, have the car detailed, a full tank of gas and new tires and we have a deal. That is what I got.

Personally, had the car been too far over KBB, I would not have shopped there.

MomToOne
01-27-2012, 02:37 PM
I've always been satisified with how much I've paid for cars doing all the traditional steps: research invoice cost to the dealership (not really the price they pay due to holdbacks, but it gives you an idea of where to shoot for), try to find out what hidden dealer incentives are going on, etc.

But I did the best on my most recent car purchase - by email! Once I figured out the car I wanted, incl. the specific model, exact options, etc. I emailed that to several dealerships, telling them I was in the market to buy immediately, had pre-approved financing, wasn't interested in bantering back and forth, and wanted to know the best deal they could give me. I had some come back with "come in and we'll talk" or "let me know the best deal you can get from other dealerships and I'll beat it", but several came back with decent deals. One was far better than the others (under invoice), so I went in on my lunch hour and bought it. :laughing:

ktlm
01-27-2012, 03:52 PM
If you are trading, know the value of the trade.

.

Absolutely! In fact, I make it a point not to tell them I'm trading in until AFTER I get the price pinned down on the car I'm buying. "Are you trading your car in", is usually one of their first questions. They may even try to get you to give them your keys to "check it out" so they can at least tell you what they would give you if you did trade. When they ask, I always tell them something to the effect of: I don't know, we are thinking about selling it ourselves. When the push to try to value it, I always say something like "I don't want to mess with that now, I just want to come up with the price on the car we are thinking about buying".

Always remember that they may try to make it look like you are getting a really good price on the car you are buying, but then short change you on a trade in to try to make up the profit on the other end.

Again, if you are going to trade in, do the same research on your car you would for any used car you are interested in buying. Remember that condition and options make a big difference on value. Again, on the websites you will get values for trade in, wholesale/private party, and retail. Know that the dealership will need/want to make a profit on your car whether it be through selling it themselves on its used car lot or through the internet or by auctioning it off at a dealer auction. I usually aim for the wholesale/private party price, or as close to it as I can get. You obviously don't want to take anything under the trade in value.

ktlm
01-30-2012, 10:06 AM
This popped up as a headline on my msn this morning:

http://editorial.autos.msn.com/10-tips-for-regret-free-car-buying?icid=autos_2091

kt_mom
01-30-2012, 03:19 PM
My son is a car salesman. :rolleyes1


The BEST advice I can give you is to get your own financing. Period. :thumbsup2

As is my husband. :rolleyes1

My DH is the GSM at a local dealership and I would give the same advice.

And yes, do your research, but there's no need to go in with an attitude from the get go. You can negotiate and be well informed and get the best deal for yourself without being a jerk.

When you are looking for your own financing don't forget the small local banks and credit unions. We have one in our area that is making great offers to people. Sometimes its not straight up though. They will offer to beat the dealer by a half point. Which is what we did. My DH got the best financing he could through one of the banks they use and then we took our contract to the credit union and refinanced for a half a point less.

aymekae
01-30-2012, 03:45 PM
We bought a new car almost 2 years ago. A few things helped us get what we thought was a good price without any hassle.

-We went on March 31st, which was both month end and quarter end, so they were eager to make a deal and get us to buy THAT DAY. All our research was completed ahead of time.
-We brought in a rival dealership's ad for the car we wanted. This was a lost lead ad in the vein of "2 at this price!" that usually sell out within the first few minutes of the place opening, but keeps people coming in all day to buy the same car at a higher price. That place was about 1 1/2 hours away, plus we'd have to take whatever color they had for those 2 cars even if we made it by opening.
-We asked if they would match that deal. And they did.

Huff
01-30-2012, 05:39 PM
I've rarely ever paid more than invoice minus incentives. Look up the invoice on kelly blue books website. Find out what incentives there are both public and dealer incentives. Edmunds website is a good source for that.

Once you know the dealers cost offer that minus any incentives. If dealer A says no, walk to dealer B. Except in cases of a very popular car, you will find a dealer that will take the offer. Note that invoice is NOT the dealers true cost, they will still make a profit. If the dealer feels that you want the car bad and won't walk, they've already won and won't budge on price.

If you work for a large corporation see if they have any automobile discount programs. Manufactures will often sell well below invoice this way.

ALWAYS negotiate the price you pay for the new car, financing and trade value individually. NEVER negotiate on monthly payment alone which is what dealers want you to do. Know how much a payment would be for a given sales amount before going to the dealer.

PatMcDuck
01-30-2012, 07:36 PM
Why? I work in finance and with decent credit, I can beat just about any rate that most banks and credit unions are offering by multiple points and I usually accomplish that with $0 down and a reasonable term (36-60 months). Manufacturer finance companies rarely allow dealers to bump rate, so usually the buy rate is the rate we contract at (I've not had a loan that I could bump in well over a year). They also limit the fees that dealers are allowed to charge and will return contracts for adjustment if we go over those fees.

So dealer financing is not bad in most cases and I personally think that you should at least consider it.


UM, not correct. They DO (legally) add points to the financing, at least here in NJ. But of course, dealer financing should be considered. But the delaers often DO add points, and they do not tell people when they do..... this is the budget board, just trying to help. Some people have other loan options, like credit unions, banks, etc. And the dealerships do help people with so-so credit get loans, who have few options.

It is just something I was unaware of, because we buy only used cars, and usually for cash (using funds from other sources).

MSLRAC
01-30-2012, 08:41 PM
UM, not correct. They DO (legally) add points to the financing, at least here in NJ. But of course, dealer financing should be considered. But the delaers often DO add points, and they do not tell people when they do..... this is the budget board, just trying to help. Some people have other loan options, like credit unions, banks, etc. And the dealerships do help people with so-so credit get loans, who have few options.

It is just something I was unaware of, because we buy only used cars, and usually for cash (using funds from other sources).

I didn't say that they didn't allow it, I said that they rarely allow it. If a person is approved on a promo rate, it can't be bumped. If it is a standard rate, where bumping is allowed, that does not mean that the rate was bumped because not all dealerships and/or states allow that.

I have no problem with people exploring all their options when it comes to financing but I think saying always get your own financing is a bit much.

sookie
01-30-2012, 11:54 PM
Why? I work in finance and with decent credit, I can beat just about any rate that most banks and credit unions are offering by multiple points and I usually accomplish that with $0 down and a reasonable term (36-60 months). Manufacturer finance companies rarely allow dealers to bump rate, so usually the buy rate is the rate we contract at (I've not had a loan that I could bump in well over a year). They also limit the fees that dealers are allowed to charge and will return contracts for adjustment if we go over those fees.

There are also some perks of dealer financing. We are a special level of Honda dealer so American Honda Finance will buy deeper for us than they will for other dealers. It's not that they are buying bad loans but they are giving a chance to first time buyers with no credit, buyers with limited credit and buyers rebuilding their credit. So many times, we have been able to get people bought that their bank or other dealers could not.

So dealer financing is not bad in most cases and I personally think that you should at least consider it.

I always come in with my own financing (and a check). That way, if the dealer has an incentive (rebate or 0%) then I get the rebate and then I use my low cost financing. The numbers crunch better that way!!
Credit unions are your friend!!