I recently bought my first grown up car. I’d been saving for a down payment for the better part of a year, and this summer I was finally ready to test drive and buy a car. Since this was my first big adult purchase, over the past 6 months I did a lot of research on purchasing used cars. I learned that there’s an overwhelming amount of information out there, but there is a lack of help when it comes to learning how to negotiate.
We live in a world where nearly everything is negotiable, but you won’t get anything unless you ask for it. I spend a lot of time at work building budgets and negotiating them. When I first started, I felt out of my comfort zone and daunted by the process. The more practice I got, the sooner I realized that negotiating was only scary because I told myself it was. Negotiating at work gave me the confidence to start negotiating for things in my personal life. Keep in mind that the more research you do before you buy the car, the more confidence you'll have. The more confident you are, the easier it will be to negotiate. You owe it to yourself to try to get a better deal. All you have to do is ask. The worst they can say is no.
2. Research Vehicles by Make, Model, Year, and Fuel Efficiency. There are a lot of cars out there. Once you know how much car you can afford, you can sort through the different makes and models to find which cars are actually in your price range. Kelley Blue Book and JD Power Dependability Award ratings are great starting points to look up how different makes and models stack up. For example, although I would have loved to get a Honda Civic or a Toyota Camry, neither of them were in my price range so I looked at other cheaper but still good quality models from Kia and Hyundai. If you’re browsing through JD power, make sure you’re looking at the correct year. Even Civics and Camrys can fluctuate significantly in quality from year to year.
3. Think About How Much the Car Will Be Worth When You’ve Paid Off the Loan. Based on the research you do in Step 2, you’ll quickly realize that not all cars maintain the same value as they age. If you’re comparing a $12,000 car from 2012 that is only worth $4,000 in 5 years when you’ve paid off the loan, with a $13,000 car from the same year that’s worth $6,000 in 5 years, that extra $1,000 when you purchase the car may help you in the long run. 4. Over the course of 2-3 months, research average prices at local dealerships. The more you know about what cars are regularly available at competing sellers, the easier it will be to identify a good deal. 5. When you’re at the dealership, ask lots of questions and be persistent when you don’t get a straight answer. When I was shopping for my car, I asked the salesperson a lot of questions about the history of the vehicle. I wanted to see the history report myself and I wanted to know the specifics of the car loan that the salesman said I was “pre-approved for”. As a woman who was solo car shopping, it was very difficult to get a direct answer from the salesman. Maybe it’s because I was a woman asking a man specific questions about the car, or maybe the salesman wasn’t used to a customer (regardless of gender) asking several questions. Either way, when I didn’t get an answer to one of my questions, I asked it again until I got a straight answer. Here are some good questions to ask when considering purchasing a car:
6. Always, Always, Always Make an Offer That’s Lower Than the Advertised Sale Price. Even if it’s already marked down. Even if the salesperson has already told you the value of the car. Even if it feels like you’re being too pushy. Even if it’s scary. Especially if it’s scary. The more you normalize talking about money and negotiating a better deal for yourself, the easier it gets. What do you have to lose? It’s not like the dealer will refuse to sell you the car just because you asked for a better price. And if the salesperson still can’t make you an offer you can work with, it’s okay to walk away. There will be other similar cars in your area. Asking for a better price isn’t a scary conversation. It can be as simple as:
Emma: The car is currently marked at $11,000 after the Memorial Day Sale pricing. That’s still a little too far out of my price range. Can you do $10,000? Stewart Salesperson: The car is normally priced at $13,000. I can’t do $10,000. E: How about $10,500? S: If you agree to purchase today with financing, I can go to the owner and ask him to approve this. **Spoiler alert, it’s rare for the owner to quibble over a few hundred dollars. Even though I didn’t get what I initially asked for, I got two and half months worth of monthly payments for free just because I asked for it. What do you have to lose? 7. Negotiate For a Better Warranty. One of the things I didn’t think about when I went to purchase my car was the warranty. After you sign to purchase the car and they run your credit card for the down payment (welp), you’re ushered over to the loan specialist who will try to sell you the more comprehensive warranty package and tells you what APR you just signed up for. This is why it’s important to make the salesperson tell you your "pre-approved rate" beforehand. Ask for specifics about the extended warranty and how it compares to the standard warranty. It’s your money. It’s okay to be assertive. You’re not being pushy, you’re asking for the facts. For example: Finance Phil: For an extra $3,000 you can get the extended 3-year warranty that covers more than the complimentary 3-month engine warranty. Emma: That’s too much. I can’t afford the warranty. F: What about if I have it included in your monthly payment? E: You still haven’t told me what my monthly payment is going to be. By how much will the warranty increase my monthly payment? F: With the warranty, your payment will be $210 a month. E: And without? F: $175. E: I was looking to keep my monthly payment under $200. I’m sorry but that’s still too much. F: What if I changed the length of the warranty from 3 years to 4 years? E: That’s something I could potentially agree to. F: If you agree to purchase the extended warranty, I can go to the owner and ask him to approve this. *Shocker*, he did the same approval song and dance as the salesman and *shocker* the owner approved the deal.
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AuthorEmma Neale: (young) adult, cat mom, and aspiring for adventure. Archives
February 2019
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