How to Get Great Deals At Car Dealerships
If you search "used car salesman" in Google, a few results would show images of a shifty-looking moustachioed chap wearing a plaid cheap leisure suit. It’s a wrong stereotype, to be sure, but it’s perpetuated because many people seem to get bad deals when buying cars at dealerships.
One thing we’d like to stress is that getting a bad or good deal when buying a car has nothing to do with luck or with devious salesmen, but on how well-prepared you are. To help you prepare for such an undertaking, here are several tips on how to get great deals at car dealerships.
Tip #1: Find out the vehicle’s worth
One of the first things you need to do is find out the value of the vehicle you’re interested in. If you don’t know the car’s value, you’re essentially allowing the dealer’s sales team to dictate how much you’re going to pay, and trust us—it won’t be based on the car’s actual worth.
To find out more about the car’s price range, visit the RedBook website. It’s an excellent resource that lets you search by make, model, year and type of vehicle. Of course, you should remember to bring the list of prices you’ve researched when you do visit the car dealership.
Tip #2: Check your credit score
Not knowing your credit score beforehand is a major no-no when setting foot in a car dealership. Remember that credit scores are crucial not only for determining whether you get the car loan or not; it would also influence the size of your car loan’s interest rate.
If you don’t know your credit score, you won’t be able to use it when negotiating, and this could cause you to lose out on a fair deal. Knowing your credit score (especially if you have good credit) gives you better bargaining power. It doesn’t guarantee you an unbeatable deal, but you’d get a fairer shake.
Tip #3: Get a pre-approved loan
With your credit report on-hand, it’s time to get a pre-approved loan. Just visit your preferred bank or credit union’s website and then apply for the loan. Once you get pre-approval, you can use it as leverage when negotiating at the dealership. If the dealer knows that you have other financing options, they’ll work hard to give you an even better deal just to make you say yes.
Tip #4: Look beyond lower payments
Okay, so it’s negotiation time. Here’s where you put your preparations to the test: make sure that you look beyond lower payments. The dealer will try to entice you to a deal by offering cheaper payments with longer repayment terms, but this would cost you even more money in interest. Look at the bigger picture—the overall value of the vehicle.
Tip #5: Don’t finance the extras
To make even more money, dealers will also try to sell you extras like extended warranty, corrosion protection, or roadside assistance. Whatever you do, don’t fall for extras. You won’t need many of them, but if you ever do, you can always get them at a cheaper cost outside the dealership and without the burden of interest rates.
Tip #6: Everything is negotiable
All facets of your purchase can be negotiated, and if you don’t, you might end up paying more than you have to. The bottom line here is that if the dealership can’t or won’t give you a better rate than what you saw somewhere else, then you should know when to walk away.
But if you do manage to get a really favourable deal, especially when compared to the numbers you got from your research, then grab it before the car salesman changes his mind; and forget the so-called perks—you can always purchase them at a cheaper price afterwards.