For the this car buying guide topic, I encourage you to hang with me.
The topic may seem elementary and not very exciting to talk about initially, but between the lines there are a couple of facets to this topic that can really save you some good money... or cost you if you're not being diligent.
So, hang in there and give some thought to what we cover.
This certainly isn't the most severe of the car buying mistakes people make from time to time, make but it does come to my mind. I guess really this would fall under the category of patience, or the lack thereof.
But, human nature is funny and there are many people seem to have great patience and shop around for their best price when they are looking to buy clothes, shoes, groceries and the like, but when it comes to car buying and shopping they head to their closest most conveniently located car dealership.
If you have to patience to shop for your other consumer goods you should muster up that patience and even more, when you car shop.
You should make it a point visit dealers not only close by but in the surrounding area as well. It could save you much money.
Every car dealer is not the same!
How could they be?
At the very least, each of their employees is going to have a bit different personality. Each dealer, depending upon when you visit them is going to be in the middle of a good month, bad month, or in between month. And this alone is going to certainly have an affect on how willing (or motivated) they are to put together a good car deal for you.
Don't take this car buying guide tip too lightly. This is a big money saving tip hidden right in the previous paragraph.
When you shop around you may find that even the prices on the cars may vary somewhat. This is because the MSRP is determined by the manufacturer who considers many factors before pricing and shipping their cars to a particular automobile dealership; a couple of which is geographic and demographic.
But, getting back to the personalities involved when car shopping; I discuss in my car buying guide that salesperson shopping can be a source of great savings (or expense) to you when it comes the to car buying process.
By visiting various car dealers, you will also not doubt come across a litany of personalities.
If you find a salesperson that you can tell enjoys working on and putting deals together and isn't afraid, or isn't offended by receiving and considering offers, you should make a note of that and get their business card.
Nothing is more frustrating when trying to work a car deal than having to deal with a salesperson that can't seem to understand their primary purpose is to sell you a car. And if it takes some negotiating to produce a win - win situation, then that's what they should do.
>>> Potential Big Money Savings Tip <<<
Sales people work on commissions. No big revelation there to be sure.
However, they all have different bonus plateaus based upon how many cars they sell each month.
Here's a very real example for you.
Let's just say I'm a salesperson that hits a pretty nice bonus if I sell 20 cars this month. And let's just say I'm sitting on 19 cars when you walk on the lot or call. You can bet I'm going to do my level best to put a deal together for you. And I'm not going to worry so much about how much commission I make on the car I sell you because...
you would be my 20th sale and my bonus that will kick in will far outweigh my worrying about maximizing my profit on this particular single car deal.
Be aware that the inverse of the above scenario can be true as well. If for example you walk on to the same lot and you happen to be greeted by a salesperson that is in the middle of a lack luster month and has no hope for hitting bonus, they're motivation won't be as high...
and even worse...
since they have no hope of hitting a sales bonus they may very well work their hardest just trying to hit home runs (trying to make the most they can off of each individual sale) in an effort to make up what they won't be getting in bonus money!
Don't be the one they make up financial ground with! Everyone is human. Salespeople have families to feed and bills to pay. It's just a fact of the business, and this is a nugget you should know and be aware of.
Before you head out, check out the dealers C.S.I. (customer satisfaction index) this is an industry term that can be found in such publications as J.D. Power. Also check with the Better Business Bureau, and even ask friends and neighbors about their experiences.
The bottom line is you should visit various dealers and even get outside your general geographic area because opportunities do change. Don't be lazy, and don't car shop when you are tired or feeling beat down. This will end up costing you money.
Be patient and persistent when you are in the car buying mode you will reap the rewards with saving a good bit of money.
Be sure to stop by and get all the details in my complete car buying guide eBook.
12/28/09
12/27/09
Car Buying Guide - V
For this segment of the car buying guide, let's discuss a hard fact that is sometimes hard to believe about car buying, and that is even with the amount of money and the financial commitment over time involved in car buying, many people impulse buy when it comes to their car.
Keeping in mind that for most of us, buying a car is a financial outlay second only to our home, is exactly why taking the time to honestly determine what kind of car genuinely fits your lifestyle is so important.
This is even more to the point if you have someone else in your life that is also going to be driving the choice of car that you decide to buy.
Take some time to frankly determine what it is that you use your car for most. If you travel a great deal, be sure to check out trunk and storage space. How does the gas mileage fit your budget? These days this is a biggie. Run the numbers and do the math, don't get caught off guard. Remember your folder? ... this is information that you should have researched.
If you do travel or spend a good bit of time on the road, you'll probably put a higher premium on a smoother, quieter, ride because even though an SUV may look attractive, over those long miles on the road, the smoother suspension will be nicer.
The point is there is not much worse in the car buying experience than getting just a few months into your car payments and realizing that the car you just bought is a mismatch for your lifestyle, your comfort, and you don't particularly like it. Be pragmatic and honest between your 'wants' and your 'needs' when it comes to car shopping.
Also, try to look at your lifestyle longer term. For example you may have young kids, which today, may fit nicely in the back of your sexy two door coupe. But, in just a couple of years are going to be too leggy and even have a time just getting them in and out of the back seat.
There were a few times indeed, when I would field a call from a someone who had not too long ago had purchased a car and at the time were quite happy, but had come to realize that their new car no longer fit the bill for them personally.
Although I would certainly like nothing more than to sell them yet another car, as you might well know there was little chance for me to be able to get them out of their current car because of the depreciation hit they took, and without some significant financial outlay on their part they were pretty much stuck.
Remember, buying a car that doesn't really fit your needs but strokes your ego, may give you a temporary lift, but eventually the reality of your needs will overshadow your initial impulses, and those payments are going to certainly continue for a while.
If you'd like to jump ahead and get all the details on the entire car buying process and how get your best possible deal, I've leveled the playing field for you with my complete car buying guide.
Keeping in mind that for most of us, buying a car is a financial outlay second only to our home, is exactly why taking the time to honestly determine what kind of car genuinely fits your lifestyle is so important.
This is even more to the point if you have someone else in your life that is also going to be driving the choice of car that you decide to buy.
Take some time to frankly determine what it is that you use your car for most. If you travel a great deal, be sure to check out trunk and storage space. How does the gas mileage fit your budget? These days this is a biggie. Run the numbers and do the math, don't get caught off guard. Remember your folder? ... this is information that you should have researched.
If you do travel or spend a good bit of time on the road, you'll probably put a higher premium on a smoother, quieter, ride because even though an SUV may look attractive, over those long miles on the road, the smoother suspension will be nicer.
The point is there is not much worse in the car buying experience than getting just a few months into your car payments and realizing that the car you just bought is a mismatch for your lifestyle, your comfort, and you don't particularly like it. Be pragmatic and honest between your 'wants' and your 'needs' when it comes to car shopping.
Also, try to look at your lifestyle longer term. For example you may have young kids, which today, may fit nicely in the back of your sexy two door coupe. But, in just a couple of years are going to be too leggy and even have a time just getting them in and out of the back seat.
There were a few times indeed, when I would field a call from a someone who had not too long ago had purchased a car and at the time were quite happy, but had come to realize that their new car no longer fit the bill for them personally.
Although I would certainly like nothing more than to sell them yet another car, as you might well know there was little chance for me to be able to get them out of their current car because of the depreciation hit they took, and without some significant financial outlay on their part they were pretty much stuck.
Remember, buying a car that doesn't really fit your needs but strokes your ego, may give you a temporary lift, but eventually the reality of your needs will overshadow your initial impulses, and those payments are going to certainly continue for a while.
If you'd like to jump ahead and get all the details on the entire car buying process and how get your best possible deal, I've leveled the playing field for you with my complete car buying guide.
12/23/09
Car Buying Guide - VI
The car buying mistake of not going on a test drive falls under the heading of I can't believe anyone would do this.
Second only to not going on a test drive would be not test driving with the purpose of doing a critical evaluation of the vehicle.
I mean really.
Why would you not test drive a potential new car for yourself? Believe me, it happens. I sold several cars where the person did not test drive the car. The reasons were varied, but none were valid.
Test drive the damn car. Sorry... but if you don't, I have no empathy for you.
You might even discover some things about the car that you did not know. This, by the way, is one of the reasons for taking the car on a test drive in the first place.
And if you have done some serious shopping and looking around you will want to come back and test drive the car again once you have narrowed your choices down to a chosen few.
Do not try to commit all your thoughts on the car to memory.
This just won't work for you.
Also, insist that you want to take the car on some various road conditions and various speeds. The sales person may push for a specific route, but be firm.
If you have to, speak with the sales manager and politely tell them of your desire to test drive the car thoroughly and that you need to experience different road conditions.
Also, it's a good idea to test drive your car on rainy or bad weather days. This will give you a different perspective as well. And as you are scoring the car on the drive, don't allow the salesperson to comment on or otherwise refute any of your scoring.
The test drive is more than a perfunctory ritual. It is the most important thing you'll do in the car buying process before you actually sit down and start negotiating your deal.
The car buying playing field has now been leveled for you with the complete car buying guide... check it out.
Second only to not going on a test drive would be not test driving with the purpose of doing a critical evaluation of the vehicle.
I mean really.
Why would you not test drive a potential new car for yourself? Believe me, it happens. I sold several cars where the person did not test drive the car. The reasons were varied, but none were valid.
Test drive the damn car. Sorry... but if you don't, I have no empathy for you.
You might even discover some things about the car that you did not know. This, by the way, is one of the reasons for taking the car on a test drive in the first place.
And if you have done some serious shopping and looking around you will want to come back and test drive the car again once you have narrowed your choices down to a chosen few.
Do not try to commit all your thoughts on the car to memory.
This just won't work for you.
Also, insist that you want to take the car on some various road conditions and various speeds. The sales person may push for a specific route, but be firm.
If you have to, speak with the sales manager and politely tell them of your desire to test drive the car thoroughly and that you need to experience different road conditions.
Also, it's a good idea to test drive your car on rainy or bad weather days. This will give you a different perspective as well. And as you are scoring the car on the drive, don't allow the salesperson to comment on or otherwise refute any of your scoring.
The test drive is more than a perfunctory ritual. It is the most important thing you'll do in the car buying process before you actually sit down and start negotiating your deal.
The car buying playing field has now been leveled for you with the complete car buying guide... check it out.
12/20/09
Car Buying Guide - VII
Cars are a depreciating asset... a rapidly depreciating one at that.
Buying a car is not investing. It is not an investment.
Oh, to be sure, you'll be 'investing' much of your hard earned money into your car over the years to come, but buying a car is not an investment.
Buying a car too soon can cost you a lot of money. I don't mean in the calendar year. I mean falling victim to all the new styles and marketing ploys car manufacturers and car dealers throw at you that stimulates you into buying a new car well before what you owe on your current ride catches up with what the actual value of the car actually is.
In car buying vernacular, when you owe more than your car is worth you are 'upside down' in your car. You're 'flipped'.
These days, believe or not, the average person ends up rolling about $2,000 of negative equity into their new car when they trade.
In other words, if you're looking at a $20,000 car and your car is worth $8,000 and your pay-off on your loan is $10,000 then you are going to be buying a $22,000 dollar car.
When the car dealer says they are going to 'pay off' your loan, they are really only rolling your negative equity from your old car into your new car and burying you even deeper in your new car.
Now, here is the extremely important point to keep in mind about our example above and why it is beyond important that you put forth a concerted effort to get the best car deal you can.
If you are bound and determined to roll negative equity into your next car purchase (which is a mistake in and of itself), then you better darn well drive a hard bargain and work every penny you can.
Here's why.
First, if you pay the sticker price of $20,000 on your new car, you just over paid for the car itself right out of the gate. I will guarantee you that the market value of that car is not $20,000!
And we haven't even added in the $2,000 you still owe on your trade!
Remember, in our example you owe $10,000 and you traded it for $8,000... because the dealer is kind enough to 'pay off your old loan'.
Before the ink even dries on your new car contract you are in a deep financial hole with your new car.
You'll really need to plan of keeping your new car around for quite awhile because you will have to drive it for a long while before you get anywhere back to even money... or at least to a point where you can even trade out without significant financial contribution on your part.
Be sure to stop by and check out the details of the whole car buying process and my complete car buying guide.
Buying a car is not investing. It is not an investment.
Oh, to be sure, you'll be 'investing' much of your hard earned money into your car over the years to come, but buying a car is not an investment.
Buying a car too soon can cost you a lot of money. I don't mean in the calendar year. I mean falling victim to all the new styles and marketing ploys car manufacturers and car dealers throw at you that stimulates you into buying a new car well before what you owe on your current ride catches up with what the actual value of the car actually is.
In car buying vernacular, when you owe more than your car is worth you are 'upside down' in your car. You're 'flipped'.
These days, believe or not, the average person ends up rolling about $2,000 of negative equity into their new car when they trade.
In other words, if you're looking at a $20,000 car and your car is worth $8,000 and your pay-off on your loan is $10,000 then you are going to be buying a $22,000 dollar car.
When the car dealer says they are going to 'pay off' your loan, they are really only rolling your negative equity from your old car into your new car and burying you even deeper in your new car.
Now, here is the extremely important point to keep in mind about our example above and why it is beyond important that you put forth a concerted effort to get the best car deal you can.
If you are bound and determined to roll negative equity into your next car purchase (which is a mistake in and of itself), then you better darn well drive a hard bargain and work every penny you can.
Here's why.
First, if you pay the sticker price of $20,000 on your new car, you just over paid for the car itself right out of the gate. I will guarantee you that the market value of that car is not $20,000!
And we haven't even added in the $2,000 you still owe on your trade!
Remember, in our example you owe $10,000 and you traded it for $8,000... because the dealer is kind enough to 'pay off your old loan'.
Before the ink even dries on your new car contract you are in a deep financial hole with your new car.
You'll really need to plan of keeping your new car around for quite awhile because you will have to drive it for a long while before you get anywhere back to even money... or at least to a point where you can even trade out without significant financial contribution on your part.
Be sure to stop by and check out the details of the whole car buying process and my complete car buying guide.
12/18/09
Car Buying Guide - VIII
With this edition of the car buying guide let's discuss a huge profit center for dealers... dealer add-on's.
Off the top of my head I cannot think of another type of transaction that you will come in contact with that would have such potential to have so many hidden and extra costs involved.
The not so funny part is that when it comes to buying a car, this is an area that almost everyone has become aware of over the years, but people still sign up for stuff and fluff they don't need and didn't even want... just good salesmanship I guess.
Right off the bat when you walk onto a car dealer's lot and look at a few sticker prices, along with the standard factory sticker price there's a good chance you'll see a dealer adds sticker on the window as well.
Without getting into a protracted list... see if these ring a bell with you: paint sealant, rust protection, fabric guard, any type of security system or glass etching, floor mats, administration fees, advertising, and my personal favorites... market value mark-up.
My short answer to you is don't pay for any of this type of big profit add-on. And don't let any salesperson tell you that you have to pay for these either.
Now, having said this you may have to take a firm stand.
By in large the actual value of these add on's to the car's market value is just about nill. The sales person may tell something to the effect that they can't take these off the price of the car because they have already been 'billed to the car'.
Well then un-bill those to the car if you want to put this deal together and if you don't then I'll go somewhere else.
And be prepared to do so.
Dealers really don't like you to try to get them to remove their documentation or administrative fees.
And why should they? This is pure unadulterated profit for the dealer.
Most will push back hard on this one, and tell you that this is not negotiable...but I'm telling you... you don't need to pay it.
From a salesperson's perspective the tangible items such as the floor mats, the security system, paint sealant, fabric guard, represent various 'spiffs'.
This means that if they can sell you these overpriced and undervalued items, they will get a small cash bonus from the dealer. For you the potential buyer they should only represent additional costs.
And you certainly don't want to be rolling any of this into your financing when you buy the car!
Be prepared to take a hard line.
Stand your ground.
Leave the car deal on the table and walk if you must... but don't buy.
After all... its about your money, not theirs.
I cover this in detail and whole bunch more in my eBook the complete car buying guide when I come clean with my years and experience in the car business.
Off the top of my head I cannot think of another type of transaction that you will come in contact with that would have such potential to have so many hidden and extra costs involved.
The not so funny part is that when it comes to buying a car, this is an area that almost everyone has become aware of over the years, but people still sign up for stuff and fluff they don't need and didn't even want... just good salesmanship I guess.
Right off the bat when you walk onto a car dealer's lot and look at a few sticker prices, along with the standard factory sticker price there's a good chance you'll see a dealer adds sticker on the window as well.
Without getting into a protracted list... see if these ring a bell with you: paint sealant, rust protection, fabric guard, any type of security system or glass etching, floor mats, administration fees, advertising, and my personal favorites... market value mark-up.
My short answer to you is don't pay for any of this type of big profit add-on. And don't let any salesperson tell you that you have to pay for these either.
Now, having said this you may have to take a firm stand.
By in large the actual value of these add on's to the car's market value is just about nill. The sales person may tell something to the effect that they can't take these off the price of the car because they have already been 'billed to the car'.
Well then un-bill those to the car if you want to put this deal together and if you don't then I'll go somewhere else.
And be prepared to do so.
Dealers really don't like you to try to get them to remove their documentation or administrative fees.
And why should they? This is pure unadulterated profit for the dealer.
Most will push back hard on this one, and tell you that this is not negotiable...but I'm telling you... you don't need to pay it.
From a salesperson's perspective the tangible items such as the floor mats, the security system, paint sealant, fabric guard, represent various 'spiffs'.
This means that if they can sell you these overpriced and undervalued items, they will get a small cash bonus from the dealer. For you the potential buyer they should only represent additional costs.
And you certainly don't want to be rolling any of this into your financing when you buy the car!
Be prepared to take a hard line.
Stand your ground.
Leave the car deal on the table and walk if you must... but don't buy.
After all... its about your money, not theirs.
I cover this in detail and whole bunch more in my eBook the complete car buying guide when I come clean with my years and experience in the car business.
12/16/09
Car Buying Guide - IX
The car buying guide topic today is a BIGGIE... negotiating or buying based upon your monthly payments...
**********************
If I had to definitively say what the biggest mistake is made by car buyers, it would be buying/negotiating a car deal based upon liking the monthly payments you are being presented with. If not the most financially imprudent mistake, certainly the most frequent car buying mistake made.
Automobile sales people salivate over customers that "just want to be able to get to a certain monthly payment." If you're one of these types of buyers, you are going to lose and probably big.
Buying your car based upon a monthly payment figure just about gives the car dealer a blank slate to work you with. Don't be one of those people. Remember, mathematically any amount (selling price) divided by a large enough number (length of your loan) will get you a small enough number (your payments) that you will be comfortable with.
Now throw in your trade in, dealer incentives, and customer rebates into the mix, and you'll soon not only be confused, but you'll be paying way too much.
I'm not saying that you don't need to have a monthly payment figure in mind that will stay within your monthly budget... all of us do. Of course you do to. It just has to stay within your mind, not blathered out all over the car lot in front of the sales person.
Know your numbers.
Calculate your monthly payments ahead of time - and know bottom line amount financed what you can afford.
When it comes to negotiating your car deal... NEVER discuss your desire to buy the car in terms of monthly payments...never.
If and when you leave the dealership with your new car, neither your car salesman, nor the sales manager, nor the finance manager, not anyone should know or not whether they met your monthly payment goals.
Buying based on a monthly payment is a trap that way too many buyers fall into.
No matter how much you want the car don't rationalize yourself into buying on a monthly payment and certainly don't ever tell the salesperson...
"if you can get me to this monthly payment then I'll buy".
And don't answer the question when the salesperson asks you... "If we can get you to this monthly payment, do we have a deal?"
Redirect the conversation off the monthly payment and back onto the selling price of their car and keep it there... stay focused.
In fact, in my car buying guide eBook, I show you a real life example of just how big. And well... isn't for the faint of heart.
**********************
If I had to definitively say what the biggest mistake is made by car buyers, it would be buying/negotiating a car deal based upon liking the monthly payments you are being presented with. If not the most financially imprudent mistake, certainly the most frequent car buying mistake made.
Automobile sales people salivate over customers that "just want to be able to get to a certain monthly payment." If you're one of these types of buyers, you are going to lose and probably big.
Buying your car based upon a monthly payment figure just about gives the car dealer a blank slate to work you with. Don't be one of those people. Remember, mathematically any amount (selling price) divided by a large enough number (length of your loan) will get you a small enough number (your payments) that you will be comfortable with.
Now throw in your trade in, dealer incentives, and customer rebates into the mix, and you'll soon not only be confused, but you'll be paying way too much.
I'm not saying that you don't need to have a monthly payment figure in mind that will stay within your monthly budget... all of us do. Of course you do to. It just has to stay within your mind, not blathered out all over the car lot in front of the sales person.
Know your numbers.
Calculate your monthly payments ahead of time - and know bottom line amount financed what you can afford.
When it comes to negotiating your car deal... NEVER discuss your desire to buy the car in terms of monthly payments...never.
If and when you leave the dealership with your new car, neither your car salesman, nor the sales manager, nor the finance manager, not anyone should know or not whether they met your monthly payment goals.
Buying based on a monthly payment is a trap that way too many buyers fall into.
No matter how much you want the car don't rationalize yourself into buying on a monthly payment and certainly don't ever tell the salesperson...
"if you can get me to this monthly payment then I'll buy".
And don't answer the question when the salesperson asks you... "If we can get you to this monthly payment, do we have a deal?"
Redirect the conversation off the monthly payment and back onto the selling price of their car and keep it there... stay focused.
In fact, in my car buying guide eBook, I show you a real life example of just how big. And well... isn't for the faint of heart.
12/14/09
Car Buying Guide - X
For this car buying guide topic I'd like to discuss with the you the importance of your trade-in and how and what not do as it pertains to working on or negotiating your next deal.
~~~~~~~~~~~~~~~~~~~~~~
The key word and very important aspect for this topic is 'separate'.
Always negotiate and work the deal on the car you are buying first.
Don't allow any conversation about your trade in.
As far as you are concerned there is no trade in involved. And as we have previously discussed, always negotiate the price on the new car from the invoice price up.
Never, never, the MSRP (sticker) down.
Salespeople make their living off the MSRP selling price, so don't expect this to be easy. But be stubborn on this point.
When it comes to your trade in, if you are not comfortable with this then leave your trade in at home and tell the salesperson there is no trade in involved in this deal. You have a much better chance of getting your best car deal if you work the components of the deal separately.
It may seem a lot easier and less time consuming to just lump the trade in negotiations in with the new car negotiations, but trust me, if you do, you will probably come away spending more than you wanted to.
Also, allowing the salesperson to mix all of the components together during the negotiating in effect has you playing on their home field.
Sales people are heavily trained on how to maximize the profit for the dealer using various sales tactics including a car sales lynch pin know as the four square close.
When you mix your trade in negotiating with the new car negotiating it is hard to keep track of all the number shuffling that you will be subjected to and easy to get confused. When you keep the various components of the car deal separate, you can focus on exactly what the pertinent numbers are.
Don't get lazy! Laziness will cost you money.
KNOW THE VALUE OF YOUR TRADE IN!!!
Sorry for yelling...
but there is no excuse for not knowing the value of your trade in.
If you don't know the market value of your trade, how will you know whether you're being offered a good price or not?
And a quick note while I'm on the subject of your trade-in.
Before you go out in your potential trade-in car shopping, take the time to clean and shine up your trade in.
Remember, every dollar counts and you do want to get the best value for your trade. If you take your trade in all dirty and nasty and then try to tell the dealer how great of car it is and what great care you have taken of it, you'll not garner much credibility during the trade negotiations.
Be confident in your research, negotiate your trade in value separate of the other components of the car deal (don't get lazy), and stay persistent throughout the entire process.
The car buying playing field has now been leveled for you with the complete car buying guide... check it out.
~~~~~~~~~~~~~~~~~~~~~~
The key word and very important aspect for this topic is 'separate'.
Always negotiate and work the deal on the car you are buying first.
Don't allow any conversation about your trade in.
As far as you are concerned there is no trade in involved. And as we have previously discussed, always negotiate the price on the new car from the invoice price up.
Never, never, the MSRP (sticker) down.
Salespeople make their living off the MSRP selling price, so don't expect this to be easy. But be stubborn on this point.
When it comes to your trade in, if you are not comfortable with this then leave your trade in at home and tell the salesperson there is no trade in involved in this deal. You have a much better chance of getting your best car deal if you work the components of the deal separately.
It may seem a lot easier and less time consuming to just lump the trade in negotiations in with the new car negotiations, but trust me, if you do, you will probably come away spending more than you wanted to.
Also, allowing the salesperson to mix all of the components together during the negotiating in effect has you playing on their home field.
Sales people are heavily trained on how to maximize the profit for the dealer using various sales tactics including a car sales lynch pin know as the four square close.
When you mix your trade in negotiating with the new car negotiating it is hard to keep track of all the number shuffling that you will be subjected to and easy to get confused. When you keep the various components of the car deal separate, you can focus on exactly what the pertinent numbers are.
Don't get lazy! Laziness will cost you money.
KNOW THE VALUE OF YOUR TRADE IN!!!
Sorry for yelling...
but there is no excuse for not knowing the value of your trade in.
If you don't know the market value of your trade, how will you know whether you're being offered a good price or not?
And a quick note while I'm on the subject of your trade-in.
Before you go out in your potential trade-in car shopping, take the time to clean and shine up your trade in.
Remember, every dollar counts and you do want to get the best value for your trade. If you take your trade in all dirty and nasty and then try to tell the dealer how great of car it is and what great care you have taken of it, you'll not garner much credibility during the trade negotiations.
Be confident in your research, negotiate your trade in value separate of the other components of the car deal (don't get lazy), and stay persistent throughout the entire process.
The car buying playing field has now been leveled for you with the complete car buying guide... check it out.
12/13/09
Car Buying Guide - XI
I touched on this in a previous discussion, but it does bear reviewing.
Negotiating car prices at the dealership is difficult (and time consuming) at best. As you may recall, for our purposes here we have discussed that there are basically three distinct areas of putting together your car deal successfully... (for you not the dealer). These three areas are the new car price, the price you want for your trade in, and the subsequent new car financing.
Don't ever forget during your car buying process that each of these areas of the car dealer that you will come in contact with (new car department, used car department, finance department) are all businesses within a business.
Each of these departments has their own manager; each manager is responsible for their profit and sales numbers. Each manager either collectively or individually can be under a good bit of pressure to improve their numbers (sales and/or profit). Again, keeping this in mind is very important for you as you try to collectively get your best deal.
Keeping these negotiating points separate during the car buying process is very difficult and most people don't. Aside from knowing exactly what you're doing, it takes a great deal of patience, and persistent on the part of the buyer. Most buyers get lazy (or tired) and just want to finish up and get out. Which they will do... buy paying more for their car than they should have.
It may sound simple in theory, but to do this successfully you may have to do a lot of haggling in each area of the deal. Don't take no as an answer from the car salesman. They are trained day in and day out how to react to and handle objections from the buyer. They make a living on not giving up, so you shouldn't either. Remember without you, there is no deal for dealer. You have the power.
Do not let your emotions get the better of you. Don't let the salesperson get the better of you and frustrate you into a poor or hasty decision.
If you feel your frustration meter being pegged out then take a break or leave all together. The sales people have to be there... you don't.
Believe me; their time is valuable to them. And the more time they have invested in you, the more they are going to want to negotiate a car deal on your behalf. Even a mini profit deal for them is better than none at all.
Next time let's talk more about the process of keeping all your car negotiating pieces separate and how you can optimize your deal.
By the way, hope you're enjoying these money saving tips... don't forget to give my car buying guide eBook a quick look too... my whole brain dump is in there!
Negotiating car prices at the dealership is difficult (and time consuming) at best. As you may recall, for our purposes here we have discussed that there are basically three distinct areas of putting together your car deal successfully... (for you not the dealer). These three areas are the new car price, the price you want for your trade in, and the subsequent new car financing.
Don't ever forget during your car buying process that each of these areas of the car dealer that you will come in contact with (new car department, used car department, finance department) are all businesses within a business.
Each of these departments has their own manager; each manager is responsible for their profit and sales numbers. Each manager either collectively or individually can be under a good bit of pressure to improve their numbers (sales and/or profit). Again, keeping this in mind is very important for you as you try to collectively get your best deal.
Keeping these negotiating points separate during the car buying process is very difficult and most people don't. Aside from knowing exactly what you're doing, it takes a great deal of patience, and persistent on the part of the buyer. Most buyers get lazy (or tired) and just want to finish up and get out. Which they will do... buy paying more for their car than they should have.
It may sound simple in theory, but to do this successfully you may have to do a lot of haggling in each area of the deal. Don't take no as an answer from the car salesman. They are trained day in and day out how to react to and handle objections from the buyer. They make a living on not giving up, so you shouldn't either. Remember without you, there is no deal for dealer. You have the power.
Do not let your emotions get the better of you. Don't let the salesperson get the better of you and frustrate you into a poor or hasty decision.
If you feel your frustration meter being pegged out then take a break or leave all together. The sales people have to be there... you don't.
Believe me; their time is valuable to them. And the more time they have invested in you, the more they are going to want to negotiate a car deal on your behalf. Even a mini profit deal for them is better than none at all.
Next time let's talk more about the process of keeping all your car negotiating pieces separate and how you can optimize your deal.
By the way, hope you're enjoying these money saving tips... don't forget to give my car buying guide eBook a quick look too... my whole brain dump is in there!
12/12/09
Car Buying Guide - XII
During the car buying process it is very easy for the waters to get muddied up and confusing for you. During any negotiating process you don't want this to be the case... it will cost you money.
~~~~~~~~~~~~~~~~~~
Previously in our car buying guide we talked about the necessity to keep the three basic areas of the car buying process (new car, trade, financing) separate. Although difficult, you must do this in order to negotiate your best car deal.
Let's start with the new car you are looking at.
First and foremost in your new car negotiations you will negotiate from the invoice price up! Never, never, ever, negotiate from the sticker price down.
Just don't!
Focus on the selling price of the new car. Oh, by the way, I am writing under the assumption that you have been a good student to this point and haven't even started this process without knowing exactly what the numbers are, both on the new and the trade in side of the ledger.
Focus on the selling price of the car you are looking at.
Don't worry about the trade at this point. Even if the used car manager is out evaluating your trade as you speak with the salesman. Remember, you already know what a fair price is for your trade in.
Once you make an offer of price for their new car do not allow such tactics as the salesperson telling you something like "I can't get you that price on this car, but I am pretty sure I can on that (other) car". Well, that car isn't the one you have researched and want. Do not let them switch cars on you. This would be a big mistake.
Stay calm, know your numbers. Don't let the sales person walk you around the lot looking at other possibilities that will fit your numbers.
Don't be ridiculous with your numbers you present. Be realistic. Sure it may take some work to get them, but don't take yourself out of the game by offering up something so ridiculously low that you aren't even taken as a serious car buyer.
You have to get their attention as a serious buyer... a sale for them is definitely possible if the numbers come together to your satisfaction.
Ultimately, the best advice I could give you on this process is that after you have done your homework on both your trade in and the new car and you have a target price for both; you will now have a number known as the trade difference. In other words, the price you are willing to pay for the new, minus the value you want for your trade is the "trade difference".
This number in your mind is extremely important in keeping your rudder straight.
Because, no matter what set of numbers the car salesman tosses at you between the new car and your trade, you know the trade difference number is your goal.
For example let's say you know that if you can get a trade difference of say $15,000 you will be satisfied with the car deal. This means that you will have met your goal getting the prices you want for the new car and your used car you traded. It also means that you have satisfied your budgetary constraints as well.
If you persist, in getting your trade difference goal you may end up a bit higher on the new car price, but also get a higher value on your trade than you thought. Or even vise versa.
For example, if the sales person comes back and asks you... "if I can get you this much more for your trade, can we earn your business?" Again, take this dollar value and subtract it from the new car price they have penciled in and then does this meet your trade difference goal?
If not, and you feel that there is still some money left on the new car, but you know they are indeed at a good price on your trade, then encourage the sales person to redirect back at the selling price of the new car and go after that last few hundred dollars that you know is fair.
I know that this is a lot to talk about. I have talked about hours if not days of work on your part. But if you want to negotiate your best car deal this is what you must be prepared to do.
Remember stay calm, cool, and collected during all parts of negotiating car prices. And most of all, know a fair price for the selling price of the new car and a fair price for your trade, so you will then know the trade difference number. Then it will be up to the car salesman, the car dealer and you to get to that number.
Be sure to stop by and check out the details of the whole car buying process and my complete car buying guide.
~~~~~~~~~~~~~~~~~~
Previously in our car buying guide we talked about the necessity to keep the three basic areas of the car buying process (new car, trade, financing) separate. Although difficult, you must do this in order to negotiate your best car deal.
Let's start with the new car you are looking at.
First and foremost in your new car negotiations you will negotiate from the invoice price up! Never, never, ever, negotiate from the sticker price down.
Just don't!
Focus on the selling price of the new car. Oh, by the way, I am writing under the assumption that you have been a good student to this point and haven't even started this process without knowing exactly what the numbers are, both on the new and the trade in side of the ledger.
Focus on the selling price of the car you are looking at.
Don't worry about the trade at this point. Even if the used car manager is out evaluating your trade as you speak with the salesman. Remember, you already know what a fair price is for your trade in.
Once you make an offer of price for their new car do not allow such tactics as the salesperson telling you something like "I can't get you that price on this car, but I am pretty sure I can on that (other) car". Well, that car isn't the one you have researched and want. Do not let them switch cars on you. This would be a big mistake.
Stay calm, know your numbers. Don't let the sales person walk you around the lot looking at other possibilities that will fit your numbers.
Don't be ridiculous with your numbers you present. Be realistic. Sure it may take some work to get them, but don't take yourself out of the game by offering up something so ridiculously low that you aren't even taken as a serious car buyer.
You have to get their attention as a serious buyer... a sale for them is definitely possible if the numbers come together to your satisfaction.
Ultimately, the best advice I could give you on this process is that after you have done your homework on both your trade in and the new car and you have a target price for both; you will now have a number known as the trade difference. In other words, the price you are willing to pay for the new, minus the value you want for your trade is the "trade difference".
This number in your mind is extremely important in keeping your rudder straight.
Because, no matter what set of numbers the car salesman tosses at you between the new car and your trade, you know the trade difference number is your goal.
For example let's say you know that if you can get a trade difference of say $15,000 you will be satisfied with the car deal. This means that you will have met your goal getting the prices you want for the new car and your used car you traded. It also means that you have satisfied your budgetary constraints as well.
If you persist, in getting your trade difference goal you may end up a bit higher on the new car price, but also get a higher value on your trade than you thought. Or even vise versa.
For example, if the sales person comes back and asks you... "if I can get you this much more for your trade, can we earn your business?" Again, take this dollar value and subtract it from the new car price they have penciled in and then does this meet your trade difference goal?
If not, and you feel that there is still some money left on the new car, but you know they are indeed at a good price on your trade, then encourage the sales person to redirect back at the selling price of the new car and go after that last few hundred dollars that you know is fair.
I know that this is a lot to talk about. I have talked about hours if not days of work on your part. But if you want to negotiate your best car deal this is what you must be prepared to do.
Remember stay calm, cool, and collected during all parts of negotiating car prices. And most of all, know a fair price for the selling price of the new car and a fair price for your trade, so you will then know the trade difference number. Then it will be up to the car salesman, the car dealer and you to get to that number.
Be sure to stop by and check out the details of the whole car buying process and my complete car buying guide.
12/10/09
Car Buying Guide - XIII
During the car buying process it is very easy to become... well... a bit too relaxed. It's actually part of the salesperson's job to get you relaxed and talkative.
That way they can gain valuable information from you in order to work and close the deal to their advantage.
Loose lips can sink ships when it comes to negotiating car deals... keep those personal numbers close to the vest and keep your poker face on.
~~~~~~~~~~~~~~~~~~
One big mistakes that car buyers make when negotiating the car prices is that... well quite frankly... they reveal their hot buttons.
Sure buying a car is an emotional experience.
Particularly if you have put a lot of work into your research and you haven't had much luck finding what you want... then you finally do and you immediately go into a slobbering mess.
O.K. maybe not that bad... but you must remember buying a car is a business transaction.
Don't let your emotions cost you big money in the car buying process. Aside from the obvious that your emotions can certainly cloud your judgment, they will also give the salesman an edge when dealing with you because now they know that you have fallen in love with a particular vehicle.
Salespeople will indeed use your enthusiasm and emotions to make the sale.
That's a big part of what selling is all about.
As a salesperson you look for things that will build momentum toward the sale and you revealing your feelings of amour toward a car will only aid the process.
And this not only applies about what you love about the new car you are test driving and looking at, but it applies to what you dislike or grown tired of about your trade in.
If you talk about all the annoyances of your current car the salesperson will have a good idea about what to show you to keep your emotions high.
Keeping your car negotiating cards close to your vest doesn't really take any of the research that we have stressed throughout, but it does take practice and concentration.
Don't underestimate the importance of this concept.
If the car salesman knows your hot buttons they will push them!
Again and again.
But they can't if they don't know what they are.
And finally, when it comes to negotiating car prices, know what your budget is and what you can afford.
Don't let your heart rule your head.
Don't pick out a car that you know you can't afford and try to negotiate your way into it. This will only create frustration and quite possibly put you in a car that you will soon financially regret.
Keep both your feet on the ground, your eye on the target, and your emotional cards tight to your vest and you'll be the one in control.
If you'd like to jump ahead and get all the details on the entire car buying process and how get your best possible deal, I've leveled the playing field for you with my complete car buying guide.
That way they can gain valuable information from you in order to work and close the deal to their advantage.
Loose lips can sink ships when it comes to negotiating car deals... keep those personal numbers close to the vest and keep your poker face on.
~~~~~~~~~~~~~~~~~~
One big mistakes that car buyers make when negotiating the car prices is that... well quite frankly... they reveal their hot buttons.
Sure buying a car is an emotional experience.
Particularly if you have put a lot of work into your research and you haven't had much luck finding what you want... then you finally do and you immediately go into a slobbering mess.
O.K. maybe not that bad... but you must remember buying a car is a business transaction.
Don't let your emotions cost you big money in the car buying process. Aside from the obvious that your emotions can certainly cloud your judgment, they will also give the salesman an edge when dealing with you because now they know that you have fallen in love with a particular vehicle.
Salespeople will indeed use your enthusiasm and emotions to make the sale.
That's a big part of what selling is all about.
As a salesperson you look for things that will build momentum toward the sale and you revealing your feelings of amour toward a car will only aid the process.
And this not only applies about what you love about the new car you are test driving and looking at, but it applies to what you dislike or grown tired of about your trade in.
If you talk about all the annoyances of your current car the salesperson will have a good idea about what to show you to keep your emotions high.
Keeping your car negotiating cards close to your vest doesn't really take any of the research that we have stressed throughout, but it does take practice and concentration.
Don't underestimate the importance of this concept.
If the car salesman knows your hot buttons they will push them!
Again and again.
But they can't if they don't know what they are.
And finally, when it comes to negotiating car prices, know what your budget is and what you can afford.
Don't let your heart rule your head.
Don't pick out a car that you know you can't afford and try to negotiate your way into it. This will only create frustration and quite possibly put you in a car that you will soon financially regret.
Keep both your feet on the ground, your eye on the target, and your emotional cards tight to your vest and you'll be the one in control.
If you'd like to jump ahead and get all the details on the entire car buying process and how get your best possible deal, I've leveled the playing field for you with my complete car buying guide.
12/8/09
Car Buying Guide - XIV
For today's stop on our car buying guide tour, let's discuss the mistake people make when it comes to tripping over their back end.
In the vernacular of car deals and car dealerships there is the front end of the deal which is the car and everything they can sell you to put on that car. You know... pin stripes, floor mats, paint protection, and oh yeah... the car itself.
The 'back end' part of the deal is the other area in which the car dealer is willing to take a home run cut at you if you so let them.... I've seen so many people work so hard to get a good deal on the front end then let their guard down when they venture into the dealership finance & insurance department(F&I)and they just give it all back and then some.
Stay tough and keep focused all the way through the entire process and you'll come out with a win a win.
~~~~~~~~~~~~~~~~~
Car buying mistakes made on the back end?
What is that?
In the vernacular of car dealers the back end part of the deal takes place in the finance manger's office (F&I). If you know nothing else about this part of the car buying process, know that the F&I person at the dealership is a sales person.
Their job is to sell you products.
Their job is to get the highest interest rate on your car loan that they can without sending you running out of their office.
They are responsible for the profitability of their department.
If their sales don't meet management and ownership's demands and goals, they will eventually be fired.
Again, just so you have no question, the F&I manager is not your friendly financial adviser making sure that your money is most efficiently spent.
The point here is, and this is where many people give back much if not more than what they gained on the front end of the deal, don't relax at this point in your car negotiations. If you do, it will cost you money.
In fact, stay focused and in negotiating mode.
You may even come across salespeople and F&I people that may imply that in order for you to get the deal that you worked hard to negotiate on the front end of the car deal you have to do your financing through the dealership.
This is NOT true.
In fact, as a student of this car buying guide, you have already done your financing homework and know exactly what your credit score is and also how much money you qualify for and for what interest rate.
And since you have done the aforementioned, you can now hold the dealership's feet to the fire and let them know you would be happy to finance through them if they can indeed provide you with the best (or better) terms than you already know you can get.
Make sure you read the contract.
I know, this sounds way too basic of advice, but you would be surprised how many people don't do this.
Also, make sure that anything that you have negotiated during the front end part of the car deal gets put in writing. If, for example, you negotiated a year of free car washes or something such that made you feel good about the deal, make sure you have it in writing and signed before you sign any contracts.
In summary, just to be perfectly clear, the F&I office is another opportunity for the dealership to sell you something, and sell you something at a very tidy profit.
Anything they try to sell you, including interest rates, has dealer profit and sales commission in it. Therefore, any of these prices are open for negotiating.
Stay focused, you're almost done once you hit the F&I department at the car dealership...
don't give all your hard car buying and negotiating work back at this point.
Don't stop your learning process here! Grab a copy of my complete car buying guide eBook, and you'll never have to worry again about getting your very best deal.
In the vernacular of car deals and car dealerships there is the front end of the deal which is the car and everything they can sell you to put on that car. You know... pin stripes, floor mats, paint protection, and oh yeah... the car itself.
The 'back end' part of the deal is the other area in which the car dealer is willing to take a home run cut at you if you so let them.... I've seen so many people work so hard to get a good deal on the front end then let their guard down when they venture into the dealership finance & insurance department(F&I)and they just give it all back and then some.
Stay tough and keep focused all the way through the entire process and you'll come out with a win a win.
~~~~~~~~~~~~~~~~~
Car buying mistakes made on the back end?
What is that?
In the vernacular of car dealers the back end part of the deal takes place in the finance manger's office (F&I). If you know nothing else about this part of the car buying process, know that the F&I person at the dealership is a sales person.
Their job is to sell you products.
Their job is to get the highest interest rate on your car loan that they can without sending you running out of their office.
They are responsible for the profitability of their department.
If their sales don't meet management and ownership's demands and goals, they will eventually be fired.
Again, just so you have no question, the F&I manager is not your friendly financial adviser making sure that your money is most efficiently spent.
The point here is, and this is where many people give back much if not more than what they gained on the front end of the deal, don't relax at this point in your car negotiations. If you do, it will cost you money.
In fact, stay focused and in negotiating mode.
You may even come across salespeople and F&I people that may imply that in order for you to get the deal that you worked hard to negotiate on the front end of the car deal you have to do your financing through the dealership.
This is NOT true.
In fact, as a student of this car buying guide, you have already done your financing homework and know exactly what your credit score is and also how much money you qualify for and for what interest rate.
And since you have done the aforementioned, you can now hold the dealership's feet to the fire and let them know you would be happy to finance through them if they can indeed provide you with the best (or better) terms than you already know you can get.
Make sure you read the contract.
I know, this sounds way too basic of advice, but you would be surprised how many people don't do this.
Also, make sure that anything that you have negotiated during the front end part of the car deal gets put in writing. If, for example, you negotiated a year of free car washes or something such that made you feel good about the deal, make sure you have it in writing and signed before you sign any contracts.
In summary, just to be perfectly clear, the F&I office is another opportunity for the dealership to sell you something, and sell you something at a very tidy profit.
Anything they try to sell you, including interest rates, has dealer profit and sales commission in it. Therefore, any of these prices are open for negotiating.
Stay focused, you're almost done once you hit the F&I department at the car dealership...
don't give all your hard car buying and negotiating work back at this point.
Don't stop your learning process here! Grab a copy of my complete car buying guide eBook, and you'll never have to worry again about getting your very best deal.
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