- Posted 12 Nov
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Car buying is exciting, but it can also be pretty daunting, especially if this is your first time purchasing a car. A lot of car dealers will do whatever they can to make the sale, and if you’re not prepared, they can get you to buy all kinds of things that make the purchase a lot more expensive than it needs to be.
Once you find your “wheels”, it’s just the beginning of a long process of negotiations in car buying and car finance. Here are four car buying hacks to ease the process:
1. Negotiate the trade of your car
Car dealers use something they call the “four-square” in their sales: vehicle trade in price, the cost of the new car, the down payment, and the monthly payment.
Trading in your car at the dealership is not your best option for starting your car buying process. On a trade-in, you’ll never get the exact value of any research you’ve done for your vehicle.
These prices are based on what your car would get at auction, not on trade in at the dealer. This means you’re better off selling the car yourself.
If this doesn’t appeal to you, then you’ll want to first negotiate the price of the new car and the car finance at the dealer, and then begin trade-in discussions around your old car.
2. Go below Invoice Price
When car buying there’s a strong move you can make to show that you are an educated consumer and that you know what you’re doing: insist on seeing the invoice price. You want to get a price at invoice or below.
The invoice price can be significantly less than the MSRP (Manufacturers suggested retail price). With this knowledge, you’ll have some good leverage when it comes to negotiating the car price and your car finance.
3. Car Finance.
You want to find the best financing you can for your new purchase. Shop around for this. The dealer will offer car financing, but they’re rates aren’t always the most competitive. Car salesman aren’t in the business of providing great financing – banks and brokers are.
4. Buying at the Right Time
The best time for car buying is at the end of the month. Car salespeople have quotas to meet, and they are generally going to be more flexible at the end of the month to meet the dealer’s expected goals and get dealer bonuses. These are monthly and quarterly, so it’s best to buy at the end of the month or quarter.
Car buying is something that requires forethought and preparation. It’s an involved process, but if you’re an educated consumer and make the effort to implement these “hacks”, it can actually be pretty fun.
So do some car finance homework and head to the dealer with confidence, ready to negotiate. You’ll be cruising in your new ride in no time!
If you need some help negotiating or just don’t want to do this process yourself, get in touch with our team to discuss your next steps.