Buying a car can be a stressful experience because of the complex nature of the transaction. The car buying transaction has several areas that can be ambiguous but important to understand to pull together a deal. Focusing on these areas and treating each one as its own transaction can help alleviate some of the stress and ensure you’re in control of getting a better deal on your vehicle purchase.
1. Vehicle Price
Before going to the dealership, you need to identify the car or cars that you are serious about and plan to test-drive them. You don’t have to engage in making a deal on the same day. Once you are set on a car, getting the right price should be your next step. Some dealerships have no haggle pricing on used cars, if you are in the market for a used car, this can be a great place to start. When you are ready to buy, if you are working with a dealer that does not have a no haggle policy, it’s time to negotiate the price of the vehicle. While the dealer may ask you where you want your payment to be, you should first make sure you become aware of any incentives and rebates that are available to customers and if the dealer is willing to lower the price below that. You can check with several dealers in your area or you can use online tools to get a view on what others have paid for a similar car.
2. Trade-in Value
If you have a car to trade-in, you will need to negotiate the price of your trade. To ensure you get a good price, evaluate your vehicle’s value by using Kelly Blue Book, AutoGravity, or other tools readily available on the internet. Whatever value you are provided, expect that the dealer will want to pay you less so they can make a profit on the trade. Some dealers will buy your car without the need to purchase a car from them. If you have the time to sell your vehicle prior to buying your new car this is the best way to maximize the value of your trade, but it can take time. When trading in your vehicle, be ready to negotiate and be ready to walk away from the deal if you are not getting the price you are looking for.
3. Financing
Knowing your credit score and knowing how much car buying power you have is very important. Financing is another area of the car purchase where there is room for negotiation. Dealers can provide financing for you, but there may be room to negotiate the rate that you are offered by 1% to 2% or more depending on your credit situation. To feel comfortable about this part of the purchase, using a service like AutoGravity will provide you with transparency on your auto financing with multiple finance offers from some of the same lenders that dealerships works with – before you go to the showroom. The three aspects above are among the biggest drivers that will impact your monthly payment and the overall quality of your deal. You may also consider purchasing additional products such at the dealership that protect your vehicle investment. Examples of these are vehicle warranty, wheel and tire coverage, and paint/dent insurance. The products are optional and you should always check your contract before signing to make sure the dealer is including products that you agree to. Following these tips will help you save time and take control of your deal.