Give me a Car Buying 101 guide! - NOW need help w/ offer

[adventure_woman]

I think we may be buying a new car. We have never bought new before. I think I had read somewhere that it is best to haggle/get quotes online. Any other hints? Is now a good time to buy a car (are they trying to get rid of their 2013s?). What are the do's/don'ts? We won't be trading in a car right now.

Also - any kinds of cars you wouldn't recommend? Currently we are initially looking at the Hyundai Elantra, Subaru Impreza or the Mazda3. We need good gas mileage.

So, any hints/advice would be appreciated!

 

[tvguy]

Get online and buy the Consumer Reports Wholesale price report for the cars you want. In the auto world, dealer cost really isn't dealer cost. At the very least, they get 3% of what the paid for the car back from the manufacturer when they actually sell it. Sometimes there are other incentives they get when they actually sell the car. CR will have all this info.

Used to be the mindset was $200 over wholesale price was a good place to start your offer. If a particular car is in high demand, expect to pay more. I usually end up paying $400 to $500 over wholesale.

Totally ignore the price sticker on the car from the manufacturer, the suggested retail price, it means absolutely nothing unless a car is in high demand. And don't even consider a secondary sticker some dealers put on a car that is almost even higher that suggested retail price.

If you are financing the car, pre-qualify with a Credit Union or bank so you know what the best rate is you can get on your won, but don't ignore dealer financing. I was shocked (as was my Credit Union) when I bought my last car because the dealer had a deal with a new credit union that had an interest rate one percent lower than my credit union.

All the cars you mention are good choices. I would suggest you drive a Ford Fiesta and Focus too.

 

[DisneyFan32WI]

I love that Subarus are all 4 wheel drive. Here in WI, that is a very important feature! I am also looking at buying or leasing a car in the next couple of months. I'll be keeping a close eye on this thread for tips.

 

[SplashMo]

A couple of tips:

1) Decide on the car, color and options by visiting dealers. Always walk out without discussing price.
2)Always tell then you are paying cash for the car. Negotiate final price and NOT monthly payment.
3) Get your financing from a bank or somewhere else. Unless they have 0% financing deal going on.
4) Do not buy clearcoat, sealant or any other add on to the car.
5) Do not fall for the extended warranty. However if you do make sure it issued by FORD, CHEVY, HONDA, etc... The warranty from the auto maker is the only one to get and is often cheaper....

6) When you have everything picked out call on the phone 3-5 dealers and ask for the fleet sales/internet sales representative. Ask them for the price over the phone. Once they give you the price ask for the Costco price. The Costco price is usually 300-500 over invoice. When you get a low price on one call the others and ask for a lower price.

7) if you have a trade in only tell them after you get the price of the car.

 

[aliceindisneyland]

My Car Buying 101 is never buy a new car! The one brand new car I've bought in my life was a money pit. The 2 new cars my parents have purchased were worse than that - money black holes?! It's amazing what "bumper to bumper" new car warranties Don't cover!
We now have 2 used Toyotas (1 is Lexus brand but as far as I'm concerned, it's a Toyota!), both over 100k miles, and we haven't done anything but oil changes and new tires in 4 years.

 

[Debkearsch]

I would have to agree with not buying brand new, we always look for something about a year old. Look into your financing before you start looking so you know just what you can afford. And finally, haggle, haggle, haggle. Have fun!

 

[msmayor]

My advice is simple...don't negotiate on just the price of the car...its the 'out-the-door' price that really matters.

Know in advance what you want the FINAL price to be, including taxes, tags, etc. If you only negotiate on the price of the car itself, then the dealer may give you what appears to be a great deal but you might see a lot of 'fluff' fees that may be added on to that great deal you negotiated.

If you negotiate on the final 'out the door' price, you don't care what the dealer does to get to that price because what he/she chooses to call that other stuff doesn't matter. You'll know you're paying EXACTLY what you agreed to.

 

[purpledisneyprncess]

Also, look into true car program online. Can get a vehicle below invoice!! Don't fall for extra warranties or add ons. 2013 models have better rebates but are getting hard to come by now. Get multiple quotes and find out your dealers doc fees!!

 

[Gumbo4x4]

The used car market isn't what it once was. A decade ago, it wasn't common to buy a 2-year-old compact car for half the original sticker. These days, if you can catch a rebate right, you might actually buy a 2013 for less than a 2012 or a 2014 for just a hair more.

Treat it like a first time Disney trip - research, research, research!

 

[Judyat]

We went through this back in May when we bought our son a car. We got Costco's price which was good and then we went to www.truecar.com and their price which was even better. The dealer accepted both since one of their dealership accepted Costco and the other true car. So if you are a Costco member check it out and then check out true car. It's free and you get the prices right online. Also as has been mentioned you want the out the door price. Good luck. The experience went much smoother than anticipated.

 

[TheRustyScupper]

CAR BUYING RULES:

1) NEVER mention a monthly payment goal.
. . . this is a license to steal for the salesman
. . . they will always fine a way to meet your payment
. . . especially when they could have sold for much less
2) Always have them give you the price for your trade UPFRONT
. . . have them estimate it before your select a car you like
. . . many adjust the car trade price based upon your new car markup
. . . get the trade price, or walk to another dealer
3) Research the car on the web
. . . look it up in KBB.Com and Edmunds.com
. . . know the invoice and the average sales prices
. . . a good price is 2%-3% over invoice
. . . the volume dealer gets 5% of the invoice back, plus bonus money
. . . do a Google for incentives on the car, asd it could be THOUSANDS
4) If you find two cars you like, pick on that has been on the lot a while
. . . 60-90 days on the lot means they are paying interest on the car
. . . they want it move it FAST
. . . many times, there is a bonus to the salesman to sell it
. . . you might get some of that bonus if you bargain tough
5) Go on the last Tuesday of the month
. . . Tuesday are terrible car sales days with few buyers
. . . at the end of the month there are sales to make for quota or bonus
. . . go 1-hour before closing and talk past closing
. . . the sales people Neill not want a good prospect to leave the lot
. . . my wife saved and additional $2,300 by doing this
6) Read articles
. . . Edmunds.com has a series of articles about car dealer tricks
. . . remember, they do this every day
. . . you do it once every few years
. . . they have the advantage!
7) If you don't get your price, be prepared to walk away!
. . . nothing gets there attention like you getting up to walk
. . . the will do everything to keep you there
. . . but, do fall for prices you don't like
. . . better to walk than pay too much
8) Things to NEVER allow to be aded to the sale
. . . dealer "fees", as this is just a way to add profit without customers seeing it
. . . a line item called "ADM", as this is Added Dealer Markup, and a phony profit method
. . . advertising fees, as this is dealer overhead and not a separate cost
. . . paperwork "fees" over $25-$50, which include taking papework to title bureau
9) Things to NEVER buy from the dealer
. . . extended warranties, as you can buy later from mfr cheaper if you want one
. . . VIN or ID etching on glass as it is overpriced and available at glass shops cheaper
. . . fabric protection or ScotchGuard, as mfrs already protect their seats
. . . paint prtoection, as mfrs have finishes which now last 15-20 years
. . . credit insurance, as it is far cheaper on the open market
. . . dealer-installed alarms, as alram dealers are much less expensive
. . . undercoating, as cars are already well protected by zinc coatings from mfr


NOTE1: For leasing, do not mention a monthly payment. Plus, ask these
questions. If the dealer hems-and-haws, run like crazy. They are trying
to fool you and hide costs and profits.
. . . what is the sales price of the vehicle
. . . . . . some hide the sales price
. . . . . . some charge sticker or above
. . . what is the residual value of the car at the end of the lease
. . . . . . some cut the value to get more interest and higher profit
. . . . . . this can add THOUSANDS in profit, even on a cheap car
. . . . . . I saw a Dodge Dart residual at 1/2 after three year lease
. . . . . . I know of no new car that depreciates 50% in three years
. . . what is the interest rate
. . . . . . money costs money
. . . . . . most leasing people bury the interest rate
. . . . . . some lease interest rates are as high as 22% !

note2: CAR BUYING TIPS AND PROBLEM AVOIDANCE:
. . . Car Dealer Traps: Car and Driver Magazine Tips
. . . Car Dealer Tactics: BankRate.Com Hints
. . . Car Dealer Tricks: Car Dealer Tricks
. . . Car Dealer Tricks: Car Buying How-To

 

[tvguy]

The used car market isn't what it once was. A decade ago, it wasn't common to buy a 2-year-old compact car for half the original sticker. These days, if you can catch a rebate right, you might actually buy a 2013 for less than a 2012 or a 2014 for just a hair more.

Treat it like a first time Disney trip - research, research, research!

Yeah, Car For Clunkers really drove used car prices through the roof. Starting to recover, and prices are heading down, but taking over 600,000 used cars off the road and to the crusher really drove up prices.

2 other suggestions if you are looking for the lowest cost per mile driven.

1) Look for car models that have been restyled, and buy the last year of the old body style. Currently 2013 and 2012 Chevy Impalas are a great deal because the 2014 has been restyled.

2) If your local rental company. Hertz keeps their best used cars for their used car lots, and wholesales the rest to the new car dealers and independent used car lots. Around here, CarMax gobbles up a lot of Hertz's rejects.

When my kids needed cars, I went to Hertz and got a 1 year old 2006 and a 1 year old 2007 Taurus. In both cases, I got cars for under $10,000, under 30,000 miles (under 25,000 miles in one case) car, still under factory warranty, plus a Hertz 1 year warranty. You could not buy a new 06 or 07 Taurus at a Ford dealership, they were fleet only, and that drove the used car value down even more. DS has had the 06 for over 6 years now, and DD the 07 for over 5 years, not a dime spent on anything other than oil, brakes and tires. Some of their friends gave them a hard time about having a boring 4 door family car, but that stopped when the friends cars were broken down, and my kids cars were purring like kittens.

 

[kymom99]

I have to agree about the new car thing. Haven't done it in years. Last year (April of 2012) my transmission went out so I needed a car. My husband researched and read good things about the Altima. He found a nice one online. It was a 2012 but it was 9 months old. Had 7700 miles on it. It had been a rental car. If you are like me, you are probably thinking, "OMG! A rental car???" Let me tell you, it was in impeccable condition. It was also "certified used". We got the remainder of the factory warranty and a 100,000 mile extended warranty because of the certified status of the car.

 

[adventure_woman]

Has anyone used TrueCar? We are trying to figure out how that works.

 

[Judyat]

Yes as mentioned above we used truecar to buy our son a car in May. We got the costco price first which was good and than my husband got an online price from truecar.com and that have even better. If you go to www.truecar.com you can put in the vehicle you want and after putting in your zip code they will give you the dealers in your area that will match it. As mentioned the dealer we went to accepted the costco price and a sister dealer accepted the true car price. The first dealer than matched it and it saved us a few hundred dollars more than the costco price. No charge to try it and I think that I actually heard about true car on one of the discussion threads here.

 

[mrodgers]

The used car market isn't what it once was. A decade ago, it wasn't common to buy a 2-year-old compact car for half the original sticker. These days, if you can catch a rebate right, you might actually buy a 2013 for less than a 2012 or a 2014 for just a hair more.

I'll agree if you go by what a dealer wants for a used car. I disagree if you go by what the car is worth.

My mother just got swindled into a "new" used car. Granted she was driving a 1996 and was interested in getting a car this spring and had some issues with her 96 so it was a good idea for her to just buy now. Problem is, they showed her a top model Focus on the floor for sticker shock, and then told her that there was a 2011 with just 9000 miles on it for $7000 less. They hook, line, and sinkered her right there and she bought a 3 year old bottom model Focus with a retail value of $14,000 for the same price she could get a brand new Focus of the same model. They didn't exactly lie, it was $7000 less than the $26,000 tag of the top model.

We bought a "new" car last winter. 2 years old and paid $13,000 less than brand new with essentially only 1 year's worth of mileage on it for us.

 

[kkwis2]

I will agree that the whole "Don't buy a new vehicle" mindset is outdated.

We have each replaced an old car with a new one in the past 4 years. Both times I researched prices and interest rates up and down to find the best deal. For both we were able to get such low rates (1.9% on our Honda and 0% on our Toyota) that financing a used vehicle went right out the window. Why would I pay more for a used vehicle when I could get a new one for a lower monthly payment and a lower price overall after figuring in finance charge???

Also, if you want a new car, get one! Don't listen to people who tell you that you shouldn't buy one. If that's what you want and you can afford it, then get what you want!

 

[Imhere]

I will agree that the whole "Don't buy a new vehicle" mindset is outdated.

We have each replaced an old car with a new one in the past 4 years. Both times I researched prices and interest rates up and down to find the best deal. For both we were able to get such low rates (1.9% on our Honda and 0% on our Toyota) that financing a used vehicle went right out the window. Why would I pay more for a used vehicle when I could get a new one for a lower monthly payment and a lower price overall after figuring in finance charge???

Also, if you want a new car, get one! Don't listen to people who tell you that you shouldn't buy one. If that's what you want and you can afford it, then get what you want!

We bought a new,(used), car in the family today. 2012 with low miles on it and probably saved $10,000 over buying new and with more options.

It's certified and has a great warranty.

Our interest rate is 1.74%

I think if you investigate all the details, buying new is never a more sound financial decision.

But, some folks just like buying new.

 

[tvguy]

I think if you investigate all the details, buying new is never a more sound financial decision.

But, some folks just like buying new.

Well, not sure never is completely accurate. There are hard heads out there like me who buy new and driver them forever (my family car turned 26 in October).

I read once the 2 least expensive ways to own a car are:

1) Buy a new car and drive it forever.

2) Buy a 2 year old used car, keep it 2 years, and trade it in on another 2 year old used car.


Both are pretty close in netting you the lowest cost per mile driven.

Look at fleets, the last time I used the Blue Van Shuttle to the airport, the van had 450,000 miles on it.

 

[adventure_woman]

Ok, so we went test driving today and DH likes the Subaru Impreza. We found a 2012 with only 11k miles. After looking up all the price comparables online, it seems that the dealer is asking exactly what it is worth (after looking at all the different websites). But, I can't imagine giving them exactly what they want for it $$ (I mean - don't they put in some negotiating room?). SO, what do we do next? Do I make them an offer? How much lower do I go than what they are asking? Or do I just ask them what their best price is? We also want to get the extended warranty which is $695 and takes us to 100k miles. Help!