Buying a car: how do you negotiate a good price?

Post by **matthew1** » 24 Sep 2009, 16:24

After writing some tips in a post here, I thought I'd open a thread where we can all share our tips, tricks and experiences in getting down to the price we want in negotiations with a dealer. New or used tactics, doesn't matter.

What works for you?

nightc1 · Post by **nightc1** » 24 Sep 2009, 19:48

This is mainly for buying used. I've bought one car new in my life, and with that I got a top end model GMC Envoy (back in 07 when the 08's came out) loaded for just under the cost of the base model. I didn't have to haggle, I just wanted one in white and they cut the price till it got to what I was willing to spend.

Before negotiating for price do your due dilligance and determine the value of the car as it is and what is coming with it. Do not assume you will even get anything more than one key if you don't ask. Here's a list of what to look through to gauge your price.

1. Get a carfax
2. Ask (if at a dealer) if it's a repo and ask about past owners
3. Get the kelly blue book price for the car in the condition it is and don't pay more for it than that unless you are dead set on it (or it would cost more in shipping to go elsewhere)
4. Go to autotrader.com and pull up all the cars of that make/model with similar option packages and print them out. Some will be dealers and some will be private sellers, use whichever you need to haggle the price.
5. For private sellers, consult your bank for what they will loan. For Dealers, seek outside financing on what they will loan. Often a dealer will loan more than a car is worth but a bank often will not ever do this.
6. Check the car from front to rear, make note of any missing interior pieces, damaged parts, weathering, wear, options that don't work, mats missing, and so on. Make sure the car specs being advertised are part of the car (this will also help with Kelly Blue Book'ing the value). If this is at a dealer, be sure to get in writing all the things that are wrong that you found will be fixed.
7. Before signing any deal or even completing negotiation, get them to show you the car's paperwork. Don't take a dealers word for anything, get them to show you. If it's a repo and be sure to ask if both keys and remotes will be included. For many volvo's you may get 4 keys and two remotes (from past experience). Two are master keys (that operate everything in the car) and two are valet keys (that only open the doors and crank the engine) and then two remotes for keyless entry. Be sure you are getting all the keys and paperwork before even sitting down.

Don't pay more than the car is worth. No amount of extras is going to make the car more valuable than it is. If you later decide to sell it, it will be harder to sell if you are missing keys and other stuff that you missed during negotiation.

But the most important thing is to just do your homework. AOL has a great auto site for showing what options came with what cars. You may have found a great car but if you find out you could have one for a few dollars more that has more options, it may be worth letting one deal go to find the right car for you. I'm really wishing my V70 had the garage door remote built in. Maybe it's something for a trip to the junkyard or ebay... but adding stuff on afterwards is not as good as getting them cheaper by shopping around.

Be willing to pay what the vehicle is worth. The market may be bad for auto makers but the value is already slashed through kelly blue book and banks... they should give you a better idea of what a car is worth than the dealer or the private seller that thinks their prize is worth much more because they serviced it regularly (which yet they want to sell).

nan2cool · Post by **nan2cool** » 25 Sep 2009, 08:31

Thanks for good tip.
This might sound silly but do you recommend CarMax?

My current '99 Honda Accord is CarMax without any warrant (except for CarMax's 30-day thing), and it has been running well besides minor issues.

If CarMax is recommended or one of options, do you recommend buying their exteneded warranty with 6-yr/10K miles paying $2K?

Thanks!

ChiNorm · Post by **ChiNorm** » 25 Sep 2009, 10:32

Again, mostly applies to used cars: Don't betray your interest in the car, act like you might be interested, sorta, only if the price is right. If the dealer knows you want the car, he will hold on the price.

Last time I bought a car, I focused almost all my attention on another car on their lot, at the last moment, "I don't think this car is going to make me happy, before I go, how much for the white one?"

Now they think I am about to walk, the white car is their last chance to make a sale.

All this presumes that you first know a couple of things:
What car do you really want?
What is the right price for the car? Only way you are going to know for sure is to shop the market.

On my previous car, in the midst of all the haggling, I kept asking, "Can you do 60 months on a used car?", so the dealer figured I was a 'payment buyer'.

Since a dealer often makes more money on the back end (finnance) than they do on the front end (purchase), they gave me a real low ball price on the car with the expectation that they would make a big profit on 60 month financing.

They were really pizzed when I came in with a cashiers check to pay for the car! F&I guy looked at the check and asked "what's this?".

The trick here was to allow them to conclude that I was a haggling mooch with marginal credit, with plenty of sub-prime finance profit.

Remember, they are going to lie to you, so you may as well treat them in kind.

Post by **findude** » 26 Sep 2009, 09:08

Here's something that works in almost any negotiation, cars or not. In relation to cars it should work with either a dealer salesperson or in a private-party sale.

Stop talking. The one who talks the most usually loses the most.

Seriously. When you are close to a deal, just put on your most indecisive face and don't say anything. Most people will talk the price down all by themselves. I had a guy at a super-high-pressure dealership talk himself down 15% in a couple of minutes during which I said nothing. I didn't end up buying the car, but it was fun to watch.

Craigd2599 · Post by **Craigd2599** » 26 Sep 2009, 14:42

Ever seen The Godfather? try the horses head in the bed routine

Post by **Ozark Lee** » 28 Sep 2009, 23:19

Most of my recent car purchases have been on eBay or Craigslist. For eBay I just put up a number I can live with and either I win or lose when the auction closes. It is normally a lowball bid since I have not been able to inspect the car. I bought my son's '96 for - I think - $350.00 but I had to drive to Chicago with a trailer to get it - it just had a loose battery cable that kept it from running. With my daughter's Porsche, I put the bid in at $1,000 but I had to drive to Phoenix to get it - no rust!

I bought my '94 NA with a stick from a dealer in Indianapolis off of eBay. I flew in (I'm working on memory which fades but I think it was a $79.00 plane ticket on a jet that was just like a real jet but it was smaller + a $90.00 cab ride to get to the dealership) and just drove it back home.

The Platinum was on Craigslist locally and I got to see it and drive it. He wanted $1,200 for it and I tried to get him down to $1,000. He was firm and I wanted the car so I paid him his price. It had a lot of warts but I wanted it and I knew exactly what was wrong with it.

The Porsche has been a money pit and my daughter is under 5' tall so the way it sits with the low seats and the long hood doesn't work real well for her. She wants an 850 so I think the For Sale sign goes up on it next week.

With other cars I have bought from dealers the "document fee" has been a great place to negotiate - they all put up a sign that it is non negotiable - it is negotiable but they need to write up the order differently. I get the price I want on the car and then when they try to slap on the document fee I insist that they go stand in line at the DMV to get the plates for it to justify the fee and make it a deal breaker - that fee gets waived.

If they would waste 4 hours waiting in line to get the license plates I would pay the document fee.

...Lee

dvc100 · Post by **dvc100** » 01 Oct 2009, 19:22

I agree with nightc1 and chinorm and Ozark...in all cars and especially used ones, you have to do your research (on the value and the car itself) and know what you want to pay and stay focused when you go. The used car folks used to use a 'black book' and those prices were a lot different from blue book values--they were the real wholesale prices--so there is a lot of room in used cars.
For new cars, there is another piece of research I use and that is Consumer Reports. For about $20, you can get a complete breakdown of the car you are looking at including options and dealer costs (their really-truly costs) and build your car so you know what it costs the dealer when you walk in. At least then you know what room you have.
I didn't see it mentioned so I will say it: the end of the month pressures on a dealership to make the numbers are real. So don't ignore that old saw...it's true. Go in late and stay long.
Finally, you have to be willing to let the dealer make some money. If you know what the score is, it is easy to walk out a winner. With new cars it is pretty easy to get close to the right number. With used cars, you just have to dig harder.

Post by **meine39** » 01 Oct 2009, 20:49

While I love and use Consumer Reports to research cars, I respectfully disagree that their fee-based new car report is worthwhile - the same information can be had on Edmunds.com using their TMV (True Market Value) tool. I have routinely used the TMV tool to price up cars, and Edmunds MSRP numbers are spot-on when entering all the options found on the window sticker.

It's ironic to me that Consumers would be the first to advise their readers not to pay for information they can get for free, yet conveniently forget to apply that to their own service. I've been calculating dealer costs on new cars from way back in the dark ages when Edmunds was a published soft back you picked up at the local newsstand. I'd go broke paying CU $20 a pop for the dozen or so window stickers I'll break down for free on Edmund's during a normal new car search.