Getting the Best New Car Price
Since automotive sales (and the economy) aren’t in the best of shape, now's the time to put off that new car purchase, right? Wrong. While it may seem silly to part with your hard-earned money right now, economic downturns mean that now is one of the best times in years to get an incredible deal on a new car, especially if you particular income source isn’t as badly affected as for some. The deals won't just happen by themselves, though. Here are some rules for getting the best deal on a car right now.
If you're thinking about buying a car, common sense says you should shop around like with any large purchase. Common sense is right. Comparing car dealers to other dealers, private sellers to private sellers, or dealers to private sellers even, can save you as much as 20% off the car's final cost. Don’t be afraid to invest time in your search either – car shopping can take as little as two days to two months, depending on your knowledge of what you want, your luck in finding the right car and of course how good your basic negotiating skills are.
When you go in to seal the deal, keep in mind it may take several hours of “back-and-forth” at the dealership (first with the salesperson, than usually with the sales manager and onward to the finance person etc.) before you get the best price possible. When you’re looking at used cars though, either at private sellers or the used car lot, it will be simpler and usually lower pressure. For used car's always run a
CARFAX report online yourself (you don’t want to pay good money for a salvaged junker, or one with a rolled-back clock) and don’t trust “carfax on hand” claims by sellers, they can be falsified. Also, always keep in mind that there are deductions typically hidden from the buyer that can be marked down from the final cost of the car at most dealers. More on that below.
For the lowest payments (and lowest total cost due to less interest paid), you should have a sizable down payment ready (typically between 10 to 20%), as well as a decent credit history. If you need financing, you may consider your bank or credit union rather than the in-house dealer lender for the best possible interest rate, though the dealer interest rates are typically very competitive.
Tips to help you get the best price on a new car
- Know the type of car you want to buy beforehand: Car shopping is a lot easier when you already know which vehicle you want to purchase, plus a buyer with an objective goal in mind is a lot less likely to be swayed by persuasive sales techniques. Getting price quotes from competing dealers or sellers is always a good idea.
- Target your shopping: If you want a hip fuel-sipping commuter, you won't get a great deal on popular cars like the MINI Cooper or new Honda Fit. You'll do better looking at the Toyota Yaris and Nissan Versa -- two good cars that are overshadowed by their competitors. Also, don't be afraid to go against the current trend: most shoppers are staying away from SUVs and trucks now, which means that you can finally get an incredible deal on that diesel Ford F250 you’ve been eyeing to haul your fifth-wheel, or a slick Escalade you’ve always wanted.
- Look at the vehicle on a dealership’s inventory list: These cars are typically marked down because they've been sitting on the lot for a long time – dealers are willing to sell these cars at a good deal to facilitate a quick sale, since manufacturers charge dealers interest and other fees on unsold inventory.
- Try shopping at large dealerships: they typically make profit off volume sales, whereas small dealerships focus more on buying low and selling high, or simply making a profit by selling high with plenty of marked-up extras.
- Buy a car at the end of the month: Sales staff are known to offer the largest discounts at the end of the month as they want to push their numbers to meet quota or receive a monthly bonus. With decent negotiation skills you have a good change at taking over control during a car's sale and avoiding the common games.
- Stop by a dealership on a rainy day: Rainy days are a great time to buy simply because of the very low traffic. Salespeople are eager to make a quick sale on these days, no doubt. Note: this may not work if you live in, say, Seattle, where rain is common throughout most of the year.
- Remember there’s no harm done by walking away: If the dealer will not cooperate and make a deal, simply walk away – it’s a salesperson’s worst nightmare as it makes them look bad in front of their sales manages if they lose a committed buyer, and will try their best to give you a good deal, sometimes at their commission’s expense.
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