Car buying advice

[EngineNo9]

In light of the other thread about the special place in hell for car salesmen, I was wondering if any of you have good advice for a first-time car buyer?  I've been putting off buying a new car for a few months simply because I don't want to deal with them.

I've done lots of research online and compared reviews of different models and all of that, but since I've never gone through the process of buying a car from a dealership I'm fairly ignorant on that end of it. 

From what I've heard you generally get a better deal on financing going through the dealership, and that seemed to be true after making a couple calls.  The car I have now isn't going to be worth squat to them as a trade-in, so I have saved enough for about a 15% down payment to avoid at least some of the interest charges. 

Haggling.  Ugh.  I'm assuming this is a necessary evil for most dealerships, is there a hard and fast rule about how far below their price to aim?  What about options and other incentives?  How much room does one dealership have versus another if it is for the same model of car?

[Ironrod]

In light of the other thread about the special place in hell for car salesmen, I was wondering if any of you have good advice for a first-time car buyer?  I've been putting off buying a new car for a few months simply because I don't want to deal with them.

I've done lots of research online and compared reviews of different models and all of that, but since I've never gone through the process of buying a car from a dealership I'm fairly ignorant on that end of it. 

From what I've heard you generally get a better deal on financing going through the dealership, and that seemed to be true after making a couple calls.  The car I have now isn't going to be worth squat to them as a trade-in, so I have saved enough for about a 15% down payment to avoid at least some of the interest charges. 

Haggling.  Ugh.  I'm assuming this is a necessary evil for most dealerships, is there a hard and fast rule about how far below their price to aim?  What about options and other incentives?  How much room does one dealership have versus another if it is for the same model of car?

Regarding trade-in -- don't tip your hand whether or not you're trading until you narrow down the price. Sometimes a dealer will offer more than your car is worth as a sweetener (and the used car and parts markets are both tight right now). Sometimes they'll budge a few hundred bucks on the trade after they draw the line on price. If you're thinking about trading, don't trash talk your old car. They might want it more than you do.

Last time I traded one I set a minimum price of $1000. The dealer offered me $1200. During the purchase negotiation I got that up to $1500. I could not have sold it for that. Mechanically it had issues (wouldn't pass inspection) but the body was in good shape and the interior was spotless.

[cheeba]

In light of the other thread about the special place in hell for car salesmen, I was wondering if any of you have good advice for a first-time car buyer?

Lots of good haggling tips at Edmunds. They also have true market values of cars - basically a better version of the Kelley Blue Book. But note that these are just guides for prices and your mileage will vary.

From what I've heard you generally get a better deal on financing going through the dealership, and that seemed to be true after making a couple calls.

In general this is true. However, especially if you belong to a credit union, it may pay to shop around. Salesmen can and will use the interest rate as a haggling tool.

The car I have now isn't going to be worth squat to them as a trade-in, so I have saved enough for about a 15% down payment to avoid at least some of the interest charges.

How's your credit? That's more important. With good credit, depending on the brand you buy, you could very well get 0% interest.  

Haggling.  Ugh.  I'm assuming this is a necessary evil for most dealerships, is there a hard and fast rule about how far below their price to aim?  What about options and other incentives?  How much room does one dealership have versus another if it is for the same model of car?

There's no hard and fast rule that I use. It depends a lot on the car. The more popular the car, the worse your position. The more cars on the lot, the better your position. Everything at a dealership can be negotiated - including options and incentives. Dealerships can vary wildly. One of the popular methods of haggling is to use e-mail, though it seems more and more dealerships no longer do this. Basically you get a price from Dealer X, then shoot an e-mail to Dealer Y asking if they can go lower. If they can, go back to Dealer X and ask if they can beat Dealer Y, etc, etc.

[Tebunker]

Also call dealerships in the next closest town. Here in the Mid-Atlantic a lot of folks go to DC or call up to DC because they think they get a better price because their are more dealerships, it's not always true, but it will give you a good idea of what you can pay. You scenarios like, if you walk in to the dealership today with cash in hand, you provide the amount, what the dealer would be willing to do then hold them to that.

Depending on the popularity of the car you can usually negotiate 1500 to 3500 off the top of a new car not including incentives and rebates. Consider previous year models that are still new. So look at 2008's that may still be on the lots, or look at 2009 models now. Obviously with the way the auto industry has been they aren't in their current year model closeout mode like they normally would be, but keep that in mind. I mean a brand new 2008 model is still brand new and you can get some incredible incentives to take it off the lot.

[kathode]

I recommend emailing around before you go into dealers (use a spam account obviously).  I did that when I bought my car and was able to get a decent offer over email.  I then sent that offer around and ended up with someone committing to beat the deal if I came in (they did). 

[EngineNo9]

Thanks for all the advice, guys.  I will definitely check around at different dealers before I buy.  Unfortunately, with the CARS program going on now doesn't seem like a great time to buy (lowered inventory and less incentive for them to deal). 

The car I have now isn't going to be worth squat to them as a trade-in, so I have saved enough for about a 15% down payment to avoid at least some of the interest charges.

How's your credit? That's more important. With good credit, depending on the brand you buy, you could very well get 0% interest. 

Last time I checked my credit wasn't too bad, and I have since paid off my credit card debt.  Unfortunately since Chase took over Wamu I can't check my credit rating for free online whenever I want.  I suppose I should check that again to get a concrete number before dealing with financing.

[Harpua3]

I say buy a bike and deal . Cars just suck money out of you and make you unhappy. See I said car and I`m more unhappy!!! rant over...

[cheeba]

Yeah make sure you check your credit rating if you can. That way you're not surprised when the salesman comes back from the back room and says, "oh your credit is not so good, we'll need a bit more money down to secure financing."

[ATB]

http://www.carbuyingtips.com/

Read the site.  It looks like crap, but there is a wealth of very helpful knowledge there.  I've used it twice in the last 10 years and have recommended it to many people.

[dedewhale]

I recommend emailing around before you go into dealers (use a spam account obviously).  I did that when I bought my car and was able to get a decent offer over email.  I then sent that offer around and ended up with someone committing to beat the deal if I came in (they did).  

I highly recommend this option. Get email quotes first. And once you do that pit them against each other and when you finally go in settle on exactly what you want and dont vary.

YOU MUST READ the edmunds forums on prices. You will get much better information then the TMV info they list. It is never a good time to buy according the dealers, they make up all sorts of crap every week to tell you demand is high (all lies)...ultimately cars manufacturers produce less cars to match the demand making it all relative. If you go to certain dealers they right now phasing out 2009 models and will give you good deals on existing sotck, but may mean you are getting things you dont want (heated seats). Some dealers are on 2010 models already and you can a la cart your car ...but may pay a little higher cost. Invoice price is BS. Some cars will say they are only making $500 above invoice...dont worry they probably have hidden deals on the back end. Always go into a dealer and negotiate the best price and be prepared to leave. If you leave many will call you and offer even more, and if they dont in a week you can always go back and get that price.

No matter how you look at it, it is a time consuming process. But the more research you do the more rewarding the whole transaction. They are not your friend, be friendly but treat it like a business deal. Also most finance rates by auto makers are much lower the banks and credit unions right now. You can get rates from 0% to 2.9% on many manufacturers. Most banks are not below 5.9% right now.

[Freezer-TPF-]

In short--don't haggle.  Do your research ahead of time, settle on a price, and stick to it.  Be firm but polite.  You don't HAVE to buy a car today.  Ask them for their best out-the-door offer, and if they can't meet your price, be polite and then walk out.  Don't sit there and haggle or play the BSD--it is a waste of time.

Emailing and getting an in-writing out-the-door price (including taxes, fees, etc) will save you the legwork, if all goes well.

[Rich]

I just did a quick look to see what my employee pricing would be on a few base cars and I'm surprised at how little discount I get now.  The employee discount used to come close to about 15% off MSRP on the base car and around 18% off the options, from what I saw right now it's only about 8% off now and the so called supplier price for friends is a lousy 4%-5% off MSRP before rebates which compares to the What are other people paying quote from Edmonds.  This is the price before you consider trade-ins or rebates.

[Ironrod]

Best deal I ever got was a previous-year model Ford Escort that somebody had special ordered, then reneged on buying. They'd added a sun roof (in an Escort?!) and had it painted "bright bittersweet", which is a polite name for orange.

Before starting my shopping I had said "color doesn't matter," by which I meant that I didn't care if it was blue or green or gray or black or red or.... I hadn't figured on orange. But once I shrugged that off and stuck to the principle, I got a fabulous price on the car that came to be known as The Pumpkin. The dealer almost paid me to take that car off his lot. My negotiating position was "1. It's orange. 2. It has a bunch of expensive options that I won't pay for. 3. In a few months it will be two model years old. And 4. It's orange."

The moral of the story is: If you're buying inventory off the lot, see if they have anything that they would dearly like to move.