How to be a Smart Car Buyer

    BEFORE you go to the dealership, consult you bank or credit union

    Thereís an old expression in the car business: "Payment buyers are low flying ducks." Don't negotiate based on monthly payment!!! It is OK to let the dealer try to beat your bank or credit union terms, but you have to know those terms in order to let the dealer compete for your business. Do not rely on dealer staff for monthly payment quotes during sales negotiations. Get that information from your bank or Credit Union before you go to the dealership. Ask your bank or credit union how much you should be borrowing given your debt to income ratio and heed their advice.

    Itís the only way to know if youíre getting a deal or being taken for a ride

    A car deal is a negotiated transaction - actually it's three major negotiations: price of car, trade-in allowance, and finance package. Everything is negotiable.

    Remember, the dealer's staff is commission-paid professional negotiators. The more money they get from you, the more they get paid. Use the internet or consumer publications to find out what the dealer paid for the car you want. Keep this in mind: the dealer's "invoice price" usually includes a 3% holdback. Negotiate from their actual cost up, not from the sticker or MSRP down.

    Know what your trade in is worth at wholesale and negotiate that amount separately. A good place to check is

    Use competition to your advantage. This isnít the only car dealer on the planet

    Do not accept high pressure sales tactics! The dealership either accepts a fair offer in a reasonable period of time or you will see if their competitor will.

    The biggest mistake is to act in haste based on emotion, forgetting that car buying is a significant business transaction. Rush into a transaction and you could buy too much car at too high a price. You might also get unfavorable credit terms. Figuring that out after you sign the contract doesnít do you much good.

    Remember, this is horse-trading. The dealerís team is there to extract maximum profit from the new car sale, sale of the trade in, sale of the credit or lease agreement and sale of extra car related goods and services. Your job is to get the right vehicle that fits your needs and your budget.

    And do it before you sign! There is no 3-day cooling off period for car sales.

    Make sure you get full credit for your down payment, trade-in allowance and all rebates on the purchase order and credit contract (if applicable).

    Read your contract carefully to ensure you are not paying for things you did not agree to buy!


                      Home  |  About  |  Links  |  Get Help  |  Scams  |  FAQs  |  Archives  |  Calculators  |  Consumer Quizzes


                      Knowledge is power. The ConsumerMan gives you the information you need to be a smarter consumer.

The ConsumerMan Home Page
Follow me on Facebook

Follow me on Twitter

© 2012 Herb Weisbaum, The ConsumerMan. All Rights Reserved.


  PRIVACY POLICY: The ConsumerMan site does not collect or keep personally identifiable information. Third-party vendors and their ad networks (including Google) use cookies, clear gifs, or web beacons to serve ads based on a user's prior visits to and other sites. You may opt out of the use of the DART cookie by visiting the advertising opt-out page. You may opt-out of many other third-party cookies by visiting the Network Advertising Initiative opt-out page.