Buying a new car.

Buying a car is one of the largest expenses a person makes in their life aside from buying a house. It’s understandable how most have at least some anxiety associated with making such a big purchase. I have been asked on my than one occasion to help negotiate the best deal on a car, and have been able to help almost everyone.

I will give some general and more specific tips – things you should know before you go to the dealership to buy a car you should go and test drive all the cars you are interested in.

Make sure these are two separate trips, never buy a car right after the test drive. This is important and will save you from the regrets of the impulsive buys.

The first thing to do is to create a list of all potential cars you are interested in. Sites like edmunds.com will give you some good information, reviews, etc. Once you picked 2-3 cars you are considering go and test drive. When the sales people try to force you to make a decision tell them this

“I have a list of cars I like to test drive before making a final decision which car is right for me. I am not ready to buy a car today”. They will get lost and let you drive the car you like.

Now you found the car you like and ready to buy it. Research the MSRP of the car with all the options as well as the Invoice price:  carsdirect.com is the best resource to get both prices. carsdirect.com will also give you a great idea of what is the price in your area. This is NOT the price you will be targeting, as a rule of thumb you can get additional 1-2% off carsdirect.com price. Reading some forums will help you determine the best price you can get on any given cars, but in general it will be between invoice and invoice + $1 500.

Now you know the car you like, with the options you like and the price you want to pay for it. We should proceed to the most difficult step – convincing the car dealer that they should let you have that car at that price.

I suggest going to a different dealer from the one where you did a test drive.  Go on a slow day, you will get a much easier deal on Wednesday mornings compare to Saturday afternoon. They will pay more attention to you when you are the only customer on the dealership.

When the salesman comes to you give them the exact model, color, options you would like and have them come back to you with the price. Once they come back with the price you tell them exactly how much  you are willing to pay for this car and how you came up with this number (usually invoice +).

So lets say you are willing to pay $1000 above invoice on that BMW. And they are saying “they will never approve it”. They will make you wait, a manager will come out, or whatever other techniques they like to use.  Your statement should stay firm:

“I am your model customer, I came here, I know exactly what I want, I don’t waste your time and ready to make a deal right now. You will make at least $1000 on this car for 15 minute of work, which is a good deal does not matter how you look at it. Lets do a deal now”.

If they say you are “difficult” “unreasonable” or “not wanting to make a deal” keep showing them the number and tell them “if you are not willing to make a deal I will go back to (name of dealership when you test drove the car) and they will give you just  that deal.

I have never seen this strategy not work, but I would appreciate your experiences with this or any other/better technique you used.

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