So, it’s time for that new car.
With all the excitement involved, it can be easy to pay far more than is strictly necessary or indeed fair.
How can you be sure you’re getting the best deal?
Here are a few tips I have learned from my own car buying experiences and from having worked at dealerships.
1. Never wait until you are in desperate need.
I am always shopping for my next car. By keeping up to date with new models and technology, you get a feel for what type of vehicle and what options you will need and like.
Listening to the various incentives, such as low financing rates, and sales, you will learn the best time to buy in your area, and can plan to purchase during that time of year.
An alternative to physically visiting the dealership is using online services such as Edmunds.com or Cars.com. These sites can search numerous dealers to help find you the best deals.
A vehicle is one of the most expensive purchases we make, and we need to take the time to make sure we know what is available.
If you do so, when the time come to replace your car you will already have in mind what you want, and will not make a hasty choice that will cost you.
2. Remain calm, cool and in control.
Never ever, let the sales staff know you are willing to buy today!
Never let on that you’re excited or really want a particular vehicle.
This will only signal the dealership that hunting season is open.
Stay in control of the conversation; do not let the sales staff pry personal information out of you.
All too often dealerships will try and figure out what monthly payment you are willing to make.
This will allow them to massage the financing and paper work to fit your budget.
The problem is you may end up paying way to much interest, as the payment term is stretched further and further.
Tell them you are only willing to negotiate total cost, with no trade-in or monthly payments.
Once the price is set then you can bring up trade-in, down payment and financing.
3. Run away if the sales staff says any of the following:
-“What do I have to do to put you in this car today?”
-“What can you afford monthly?”
-“This is a limited time offer”, or “obviously you do not want to save money.”
-“I am a new salesman, and am still learning”. This is a common tactic to make you feel dominant. It works until you start the negotiations and realise they a sales savant.
-“I do not know what that fee is for but we always charge it.”
A good salesman will never try to pressure you; they know you will come back if you are interested.
4. The trade-in.
It is up to you whether or not you want to trade in a vehicle or sell it privately.
Both have benefits and drawbacks.
Private sales can give you more cash in hand toward a down payment, and you will get a fair market value for your old car.
With a trade-in you will get a below market value amount for your car, but this amount will be taken off the ‘before tax’ price of the vehicle you plan to purchase. This means you will be taxed on a lower amount.
The dealer offers you less as they have to resell the car and make a profit, but make sure the profit is not unfair to you.
To find out the fair value for your trade-in, use websites like, Kellybluebook.com or Canadianblackbook.com.
Also, be honest about the condition of your trade-in, they will examine it and you may garner a little extra respect and that can help in the negotiations.
5. Do not sign anything!
Never sign anything until you are 100% certain you are ready to buy.
Ready to buy means you understand all the fees that are found on the sales invoice, any verbal agreements have been included in writing on the sales invoice, and that you are getting the exact car with the exact options you want.
Remember that just because a fee is printed on an invoice does not mean it is mandatory. For example: rust-proofing, nitrogen filled tires, sealant, insurance, admin fees, and prep fees are all added by the individual dealer.
6. Read the fine print.
Never buy a new car without the manufacturers MSRP sticker in the window.
This sticker ensures you get the options you want and breaks down the costs of said options.
Also, in the case of added fees, the MSRP sticker may contain a statement to the effect of, “Manufacturer’s suggested retail price includes manufacturer’s recommended pre-delivery service.” This information can save you hundreds of dollars as the sales staff tries to convince you the PDI is extra.
Some PDI’s cost upwards of $600.00. Believe me when I say that is a lie. I have done them; they take less than 2 hours.
Also, never pay cash for a deposit or down payment, if the deal falls through it may be hard to retrieve it.
There are thousands of dealers out there, many are great, and some are not. Stick to your guns when negotiating, and be ready to walk away if they are not willing to work with you.