WWYD- Need new car due to accident.

[princessmom29]

Glad you didn't get suckered but the vast majority of people who focus on the payment verses the end price DO get suckered. Don't get your Mickey panties in a wad, nobody is calling you stupid. See the following story of an Edmunds employee who went undercover for months and documented the exact $X payment play that you described. The buyer walked out thinking they got a "good" deal but really the only one who ended up with a good deal was the car salesman and dealership. There is a huge psychology behind the $X payment play.

This story is lengthy, but totally worth the read.
http://www.edmunds.com/advice/buying/articles/42962/article.html

Sorry if the offends you, but advising others to go in and ask for $X payment is feeding lambs to the wolves. Focus on the total price+interest verses how much it costs you per month. If you are only concerned about cost per month then please call me and I will gladly finance your next loan at your monthly price for the next 50 years.

You may not have meant it that way, but your op came off as very condescending and as if you thought everyone who didn't do it your way was stupid. That is why I felt the need to respond as well. I also am not stupid and did not get suckered. Not everyone who talks about monthly payments does. Not everyone has the funds to pay cash for a car and many will never be able to no matter what they do. They only have x amount a month to pay for a car. They HAVE to know what the monthly payment will be before they agree to a deal. For them, it IS important to keep month to month costs down, and both total cost plus interest and monthly payments are a concern. You can go into a dealership with a concerete idea of what you would like for BOTH and not get suckered. There is more than one way to apporach a car purchase and not be taken for a ride.

 

[prncess674]

You may not have meant it that way, but your op came off as very condescending and as if you thought everyone who didn't do it your way was stupid. That is why I felt the need to respond as well. I also am not stupid and did not get suckered. Not everyone who talks about monthly payments does. Not everyone has the funds to pay cash for a car and many will never be able to no matter what they do. They only have x amount a month to pay for a car. They HAVE to know what the monthly payment will be before they agree to a deal. For them, it IS important to keep month to month costs down, and both total cost plus interest and monthly payments are a concern. You can go into a dealership with a concerete idea of what you would like for BOTH and not get suckered. There is more than one way to apporach a car purchase and not be taken for a ride.

That doesn't even make logical sense. You would be willing to overpay for a car simply because they will lower the payment. Also note that if you pay more than the car is worth and you get plowed by another car the day after you bought it you will only be paid what it is valued at and you will then be paying for a hunk of useless metal. Part of the reason they are also trying to figure out your down payment is they know that a bank will only loan up to the value, so if you are willing to put $4K down then they know that they can get loan value +$4K out of you and make more profit.

I know you think your way is a great way to do business but advocating that others go in and put their cards on the table is just crazy. Get pre approved and know your rate and terms, then know that you can't pay over Z price for a car. Research the dealer inventory online and know what a vehicle is worth via an independent service not affiliated with the dealership. I am amazed how many people just walk in to a dealership test drive a car and then just negotiate blindly. Anytime a dealer tells you a deal is "only good today" or "we can certainly get you that car for $x payment" you can pretty much infer that the deal is always in favor of the dealer. They don't want you to walk out and do your research.

As stated previously, just because they meet your monthly payment you need to review the interest rate and length of loan is the point I am trying to make. In your example it would be easy to say we are giving you a great price but more then they can make up the difference by putting the screws to you with a horrible interest rate and/or loan terms. You got your "great price" and $X payment but you will now be paying that payment for what could be potentially too long of a time which goes back to my original statement of negotiate the elements separately.

 

[PrincessSuzanne]

You may not have meant it that way, but your op came off as very condescending and as if you thought everyone who didn't do it your way was stupid. That is why I felt the need to respond as well. I also am not stupid and did not get suckered. Not everyone who talks about monthly payments does. Not everyone has the funds to pay cash for a car and many will never be able to no matter what they do. They only have x amount a month to pay for a car. They HAVE to know what the monthly payment will be before they agree to a deal. For them, it IS important to keep month to month costs down, and both total cost plus interest and monthly payments are a concern. You can go into a dealership with a concerete idea of what you would like for BOTH and not get suckered. There is more than one way to apporach a car purchase and not be taken for a ride.

Thank you, you said exactly what I was thinking, but didn't know how to say politely on the DIS. I didn't get suckered, or overcharged, I went in knowing exactly what was going on and was treated fairly. Actually, the dealership probably lost alot of money on the deal they gave me, because I am sure they were probably going to mark up the price when they put the car on the lot, but I was able to work a deal and with interest and taxes, I walked away with a steal. I got the car for much less than KBB said it was worth. That is why I said I wasn't stupid, because I was prepared. Dh is still driving that car to this day.

That doesn't even make logical sense. You would be willing to overpay for a car simply because they will lower the payment. Also note that if you pay more than the car is worth and you get plowed by another car the day after you bought it you will only be paid what it is valued at and you will then be paying for a hunk of useless metal. Part of the reason they are also trying to figure out your down payment is they know that a bank will only loan up to the value, so if you are willing to put $4K down then they know that they can get loan value +$4K out of you and make more profit.

I know you think your way is a great way to do business but advocating that others go in and put their cards on the table is just crazy. Get pre approved and know your rate and terms, then know that you can't pay over Z price for a car. Research the dealer inventory online and know what a vehicle is worth via an independent service not affiliated with the dealership. I am amazed how many people just walk in to a dealership test drive a car and then just negotiate blindly. Anytime a dealer tells you a deal is "only good today" or "we can certainly get you that car for $x payment" you can pretty much infer that the deal is always in favor of the dealer. They don't want you to walk out and do your research.

As stated previously, just because they meet your monthly payment you need to review the interest rate and length of loan is the point I am trying to make. In your example it would be easy to say we are giving you a great price but more then they can make up the difference by putting the screws to you with a horrible interest rate and/or loan terms. You got your "great price" and $X payment but you will now be paying that payment for what could be potentially too long of a time which goes back to my original statement of negotiate the elements separately.

I DIDN'T overpay for anything. I negotiated quite well, if I do say so myself. I got a sweet deal. I would never go in anywhere without knowing what I am getting into, because that is the way I deal with EVERYTHING. I certainly wouldn't go into a car dealership and blindly and deal with those snakes (and that is the way I feel about most car salesmen). I knew basically what I wanted and knew exaclty what I was getting into and would have walked away if they hadn't been able to deal with my terms. Just because I didn't explain all those minute details in my first post doesn't mean I got taken.

Suzanne

 

[puffkin]

Update- Well the insurance company did NOT total the car so they will be sending us the check to get it fixed. That is good news to us as long as the car can be repaired to its former condition!!!! Now we are hoping it will be finished before our rental coverage ends but hopefully that won't be an issue.

To top it all off, I got called for an interview later this week and DH just heard back from a job he interviewed for that they want to bring him in for a second interview! We have had so much bad luck in the last year that we were due some good news. Fingers crossed that at least one of the jobs will pan out......

 

[prncess674]

the dealership probably lost alot of money on the deal they gave me,

Dealerships are in business to make money, they are not charity units. If they didn't make a profit, they wouldn't have sold it to you.

 

[01spirit750]

Most people negotiate down from the MSRP on the window tag. The thinking is that anything below the MSRP and the dealer is losing money. Not the case.

The dealer makes $4-6k on the MSRP of a $38k car plus a couple more $k on the hold back and dealer incentives (not available to the consumer)

I negotiate down from the Dealer invoice price. This is the price the dealer pays the mfg for the car. Of course the dealer gets a "hold back" as well as other incentives for making quotas etc from the mfg as well as. These can be up to several $1k or more.

Then add in the profit from the interest and finance charges which is another $4-5k.

So even if you purchased the car for $12k less then the MSRP the dealer still made money.

A dealer will never sell you a car and lose money.

 

[princessmom29]

That doesn't even make logical sense. You would be willing to overpay for a car simply because they will lower the payment. Also note that if you pay more than the car is worth and you get plowed by another car the day after you bought it you will only be paid what it is valued at and you will then be paying for a hunk of useless metal. Part of the reason they are also trying to figure out your down payment is they know that a bank will only loan up to the value, so if you are willing to put $4K down then they know that they can get loan value +$4K out of you and make more profit.

I know you think your way is a great way to do business but advocating that others go in and put their cards on the table is just crazy. Get pre approved and know your rate and terms, then know that you can't pay over Z price for a car. Research the dealer inventory online and know what a vehicle is worth via an independent service not affiliated with the dealership. I am amazed how many people just walk in to a dealership test drive a car and then just negotiate blindly. Anytime a dealer tells you a deal is "only good today" or "we can certainly get you that car for $x payment" you can pretty much infer that the deal is always in favor of the dealer. They don't want you to walk out and do your research.

As stated previously, just because they meet your monthly payment you need to review the interest rate and length of loan is the point I am trying to make. In your example it would be easy to say we are giving you a great price but more then they can make up the difference by putting the screws to you with a horrible interest rate and/or loan terms. You got your "great price" and $X payment but you will now be paying that payment for what could be potentially too long of a time which goes back to my original statement of negotiate the elements separately.

you are not getting what I am saying. No one is advocating over paying for anything. I am saying that for some people, monthly payment is as important as price plus interest. I really, really do get the idea that they CAN extend the terms of the loan to lower a payment. I am not stupid!, but you can use "I cannot pay that per month and I will not extend the term of the loan" to get the price down!!! It can and DOES work. They are not willing to lose a sale over the few grand it will take to drop a monthly payment by x a month. I cannot state it any simpler than that. I just don't undrstand how you think they could stick it to me if I know what I am willing to pay for the car, what the interest rate should be, how long I want to finance, and what the payment on that should be??? Just because I use the argument of "I cannot pay that every month" to get the sellnig price down rather than "I won't pay over X out the door" doesn't eman I am any more likely to get cheated.

 

[donalduck]

Agree that there you are only giving yourself two options: (1)Brand spanking new car or (2) junker.

There are plenty of options in between. You can save thousands of dollars buying a late model used car. Agree that I would look at Honda Civics.

Honda Civics are over priced and not worth the money. What are you getting by paying more money for a car that a cheaper car doesn't have.

 

[prncess674]

Honda Civics are over priced and not worth the money. What are you getting by paying more money for a car that a cheaper car doesn't have.

What do you suggest, I didn't say ONLY look at Honda Civics. I had one in high school and it ran great for being an older model car. My sister had a Chevy Nova and it was POS that was in the shop more than any other car I have ever seen. I suggested Honda for a good used car which tends to drive into infinity. As always, your mileage may vary.

 

[Scurvy]

OP, I'm glad to hear that your car can be fixed! I hope you get good news from the interviews as well.

Honda Civics are over priced and not worth the money. What are you getting by paying more money for a car that a cheaper car doesn't have.

Reliability and value retention, among other things.

Sorry, I just spent weeks researching and test driving Civics and their competitors. If someone is looking for a small sedan, the Civic is head and shoulders above most of it's competition. The Mazda 3 is also a good choice and the Nissan Sentra isn't bad, either. Sadly, the Toyota Corolla just doesn't seem to measure up this year and none of the American cars come close. Even when looking at used sedans, the Civic is almost always the best choice. This month's Consumer Reports has an in-depth look at the best used cars to buy and Civics are very highly rated.

 

[PrincessSuzanne]

Dealerships are in business to make money, they are not charity units. If they didn't make a profit, they wouldn't have sold it to you.

Most people negotiate down from the MSRP on the window tag. The thinking is that anything below the MSRP and the dealer is losing money. Not the case.

The dealer makes $4-6k on the MSRP of a $38k car plus a couple more $k on the hold back and dealer incentives (not available to the consumer)

I negotiate down from the Dealer invoice price. This is the price the dealer pays the mfg for the car. Of course the dealer gets a "hold back" as well as other incentives for making quotas etc from the mfg as well as. These can be up to several $1k or more.

Then add in the profit from the interest and finance charges which is another $4-5k.

So even if you purchased the car for $12k less then the MSRP the dealer still made money.

A dealer will never sell you a car and lose money.

Since neither of you were there, you really can't say whether the dealership lost money or not. I didn't and NEVER will buy a new car and I am smart enough to NEVER get taken.

Suzanne

 

[donalduck]

OP, I'm glad to hear that your car can be fixed! I hope you get good news from the interviews as well.



Reliability and value retention, among other things.

Sorry, I just spent weeks researching and test driving Civics and their competitors. If someone is looking for a small sedan, the Civic is head and shoulders above most of it's competition. The Mazda 3 is also a good choice and the Nissan Sentra isn't bad, either. Sadly, the Toyota Corolla just doesn't seem to measure up this year and none of the American cars come close. Even when looking at used sedans, the Civic is almost always the best choice. This month's Consumer Reports has an in-depth look at the best used cars to buy and Civics are very highly rated.

ya and how much more was the honda civic then the other cars you were looking at? Where all the cars the same price?

 

[donalduck]

What do you suggest, I didn't say ONLY look at Honda Civics. I had one in high school and it ran great for being an older model car. My sister had a Chevy Nova and it was POS that was in the shop more than any other car I have ever seen. I suggested Honda for a good used car which tends to drive into infinity. As always, your mileage may vary.

What I am saying is that there are cheaper cars then honda civic's. They are over rated. Just saying.

 

[Irin997]

ya and how much more was the honda civic then the other cars you were looking at? Where all the cars the same price?

Not much. I purchased a 97 Honda Accord for $5500 about 5 years ago. I could have bought a Ford Escort for less. However, my Accord has retained a lot more value than a Ford Escort would have. Not to mention the fact that it has 190,000 miles on it and is still going strong. I would not have expected a Ford Escort to perform the same way. And that is exactly why I looked for a used foreign car. a) they hold their value MUCH longer & b) they can (in general) go much longer without serious issues than a domestic car.

And when we really get into the logistics of it, I think I could have saved $1-2k by NOT buying a Honda, but would it be worth anything now? Probably not.

 

[Irin997]

What I am saying is that there are cheaper cars then honda civic's. They are over rated. Just saying.

Cheaper doesn't necessarily equal better.

 

[Kathi OD]

Not much. I purchased a 97 Honda Accord for $5500 about 5 years ago. I could have bought a Ford Escort for less. However, my Accord has retained a lot more value than a Ford Escort would have. Not to mention the fact that it has 190,000 miles on it and is still going strong. I would not have expected a Ford Escort to perform the same way. And that is exactly why I looked for a used foreign car. a) they hold their value MUCH longer & b) they can (in general) go much longer without serious issues than a domestic car.

And when we really get into the logistics of it, I think I could have saved $1-2k by NOT buying a Honda, but would it be worth anything now? Probably not.

Maybe you should have. DH drove a Ford Escort for almost 250K miles. He paid just under $2K for it. Escorts, and now the Focus, have been pretty reliable in our house.

 

[Irin997]

Maybe you should have. DH drove a Ford Escort for almost 250K miles. He paid just under $2K for it. Escorts, and now the Focus, have been pretty reliable in our house.

To each their own.

 

[Scurvy]

Cheaper doesn't necessarily equal better.

Exactly! I'd rather pay a little more now and have fewer repair bills over the life of the car. Plus there's resale value to consider. I'm happy to pay more when it means I'm getting something that's worth more. Cheap is not necessarily a good thing, especially when it comes to cars! Often what is cheap in the short term ends up very expensive in the long run. Of course if you look at cars as disposable, and you don't intend to drive it for more than a couple of years, it might be better to buy a cheap car and enjoy it while it lasts. But since I use my cars for at least 200,000 miles I prefer to research it and buy the best car I possibly can and all the experts agree that the Civic is one of the best sedans out there right now.