Coronavirus & Crazy Amazing Car Deals...Here's How To Win Your Next Negotiation
The Coronavirus pandemic has made for a pretty sweet time to buy a car. If you are getting ready to pull the trigger, let me give you some advice that will help you walk away with the best deal possible.
Something is wrong with me that I love the experience of buying or leasing a new car. I always feel like a soldier preparing for battle. Don’t rule out jumping in place, rolling your neck, stretching, and mentally preparing to be bold. I can’t wait to see what amazing deal I can negotiate. And I can’t wait to see what new BS they are going to try to pull.
Now don’t get me wrong—Some days, victory is just not in the cards. Have you ever done a home improvement project that should be simple, yet everything goes wrong? Have you ever come back another day and it all just went into place for some reason? That’s like buying a car. Some days, I walk away with nothing—I leave having gotten nowhere. That just means trying a different dealership or a different day or a different salesman, or sometimes all three.
Now roll up your sleeves and stretch your neck because here are 8 SECRETS to getting the best deal on your next car purchase.
1) DO YOUR RESEARCH
You should know what the car costs before you ever step foot through the dealer’s doors. I usually have two cars that I’m deciding between and I let the test-drive determine which one wins, but I still know what each of those cars cost—including the options I want.
2) WALK-IN EMPTY HANDED
Get rid of your current car beforehand. Depending on how much money you have or how much hassle you’re willing to endure will determine how that happens. The most preferable way is to sell the car on your own. If you don’t want to mess with that, take it to a Carmax type of place and do your best to get a little more than they offer you the first time. You won’t be able to talk them up too much. And you'll lose more money this way, but if you absolutely can't take the hassle of selling it yourself and have to trade it in, make sure you’re trading in a car of the same make. In other words, trade-in your Honda at a Honda dealership, because if you’re trading across manufacturers, they are going to offer you a wholesale price and you will lose out big time.
3) FIND A GOOD SALESPERSON
There seems to be a trend of salespeople whose attitude is dismissive of the customer, as in, “I’m wasting my time—You can’t afford this car.” I’m seeing more and more of it. It must work to some degree, as some consumers think, “I’ll show you I’m a serious buyer and can afford this car!” If you get one of these people, ask for a different salesperson. That’s a better revenge than letting them rip you off just to prove you’re serious. It’s also great fun to watch their reaction as they become a bit panicked that they will now be in trouble.
You want to find a salesperson who is on your side. Many of the good ones are. My favorite salesman is a guy who tells me, “This is the lowest price I’ll be able to get them to, but I’m pretty sure they will agree to it.” Both times I’ve used him, his number was lower than what I was hoping to pay. For a guy like this, business is booming!
4) ASK HOW MUCH DEALER HANDLING FEES ARE
These are hidden fees of pure profit you usually won’t find out about until you are seated in the finance person's office, signing all the paperwork, and by that time, you feel committed so you just sign it. These fees usually average between $500 and $1000. Use this information to negotiate. When they tell you, “We can get you $1,500 off the price.” You should respond back, “Well, not really. Your dealer handling is $1,000, so really that’s only $500 off.” Don't find yourself in a situation where you think you've negotiated a price only to have them take $1,000 of your hard-earned effort back at the last second.
5) SHOP NEAR THE END OF THE MONTH
This isn’t always a guarantee, but oftentimes dealers have sales numbers and quotas they are trying to reach, and if they haven’t met them, you can win big. Sometimes the end of a financial quarter is even better than the end of the month—assuming they need more sales to reach their goals.
6) NEGOTIATE AN OUT-THE-DOOR-PRICE
You want to tell them the price you want out the door. That should include taxes, fees, dealer handling, etc. It’s easier to say, “I’ll write you a check for $10,000 for this used car and that’s it.” When you negotiate an out-the-door-price, they will work the numbers backward to make everything fit.
7) TRY TO WORK WITH A MANAGER
This is happening more and more frequently nowadays anyways, as many managers will speak with every customer before they leave, even if a deal is not reached. But if you find yourself close to a deal but just can’t seem to make it happen, when the salesperson disappears for 15 minutes at a time pretending like he’s trying to get your deal, ask to speak with the manager. Managers are typically direct and say things like, “What can we do to make this happen.” You tell them your out-the-door-price (if you’re buying) or your down payment and monthly amount (if you’re leasing) and get them to say yes or no. If they can’t do it, they will usually tell you the best they can do. At this point, if it’s not low enough and you walk out, my experience has been they will not come after you.
8) DON’T BUY PREPAID MAINTENANCE
You’ve negotiated the deal and you’re signing all the paperwork when they offer you this prepaid maintenance package for just a little bit more. They tell you how they’ll come to pick up the car and do everything for you. You salivate at the thought of not having to worry about car maintenance for three years—but trust me—you will. The concierge service, in my experience, is a pain in the butt and overpriced. Someone has to be home and sign the paperwork, show a driver’s license and insurance to drive the loaner. Usually, they will not let another household member sign or drive the loaner either, which means you have to sit at home and wait for the teenage car-shuttler, who knows nothing, to show up and have you sign. Only accept prepaid maintenance if it’s already part of the existing deal, which on a new car it should be, at least for the first few years. Just don’t let them use that as a bargaining chip! “We are paying your maintenance for the first 3 years,” they will say. You should be quick to roll your shoulders back, stretch your neck and snap back, “That’s not a selling point. Everyone is doing that.”
Now go get 'em, soldier!!!
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Until next time...