Are you
in the market for buying a vehicle? I
recently found myself in the predicament of having to navigate the often very
stressful and intimidating world of car shopping, only to come out on the other
side empowered, educated, and confident in my decision.
Tip # 1: Although it is not always a possibility, try
to start looking before you are in desperation mode. Car buying negotiation and research is best
done over time, without the added pressure of necessity or emergency. I began
the car-buying process by asking around for opinions from friends and
co-workers. Everyone has great advice to
share from their own car buying experience, and usually want to talk about it
because it often becomes a big life event for many people.
Tip # 2: Do not feel obligated to purchase a vehicle
when shopping around. Even if a
Salesperson has been extremely helpful, do not feel obligated, and especially if they are pressuring you,
DO NOT FOLD. There is power in walking
away. I had
never purchased a vehicle before, and wasn’t sure what to expect. I had visions of Car Salesmen circling me like
sharks at the Dealership to get a sale….well it wasn’t quite this way, however, you do get a
sense of urgency to “make that sale” and all the tactics are used, whether you
realize it or not. The first tactic I
encountered was the Finance Manager assuming that I was purchasing the vehicle
that day, after I had met with the Salesperson for all of 15 minutes. Yes, there are levels of Salespeople, first
you deal with the Salesperson, and then you meet the Finance Manager, who is
essentially there to close the deal. I
had to be confrontational and say to the Finance Manager, “I’m not planning to
buy a car today. This is a big purchase;
I need time to think about it.” I was
then told, “We sell 20-30 vehicles per week…it might not be at the lot when you
return, in fact I’ve had cars sold right after someone left the lot.” I was
given the gimmick of, “Just take the car home for 24 hours, and see how you
like it, that way no one else can buy it…”
This is because the Dealership knows if you go home to think about it
and do not have an obligation to come back, chances are you will not return,
especially if you research prices and find you can get a better deal
elsewhere. I had to say “No thank you”
many more times than I am comfortable with (at least 10 times!) before I finally
left the Dealership. Evidently, the
vehicle didn’t sell as soon as I left the lot because I received several phone
calls over the next week or so asking when I would be coming in to purchase the
vehicle, they couldn’t hold it much longer, etc., until I finally told them
that I would not be purchasing the vehicle at all.
At first, I didn’t want to say “no” because I was scared that I was
passing up a good deal, but, then I realized that I really didn’t like their
sales tactics and I wanted more time to become informed and make the best choice for my needs. You must lean into these
uncomfortable moments and learn from them, because you will be glad that you
ultimately made the choice that is best for YOU.
Tip # 3: Shop around, not only for
the right vehicle, but the right financing. I also
approached several banking institutions (Credit Unions mostly) to request
information regarding car loans. You
need to know that you have options. When
you begin to discuss financing with the Car Salesman, they will most likely tell you that their interest rates are the lowest (I spoke with three different Dealerships that said this). Well, I ended up finding an interest rate
lower than all the Salesmen I negotiated with, just by doing my own research,
and taking my time. It is in THEIR best
interest for you to finance with them…but, you have to realize that you should
make decisions based on YOUR best interest, because you will be making the
payments. It is quite possible that you
could get the better interest rate through the Salesman, but, by doing your
due-diligence, you will be confident that you are getting the better rate in
whichever route you choose.
Tip # 4: Know what your needs are, and know what your
personal financial limits and goals are…there may be options that you haven’t
considered that may help you achieve your goals while staying within your
budget. Because
of my modest income as an AmeriCorps VISTA, I automatically assumed that I
would only be able to afford a used vehicle.
After speaking with an Industry Professional, I began to realize that if
I buy a used vehicle, that is most likely out of warranty, how will I pay for
any unforeseen mechanical problems? I
would inevitably have dip into my Emergency Savings, or worse, put debt onto a
credit card. I slowly began to think
about the possibility of a new vehicle, which would still be under
warranty. I began my research online,
and you will see that the majority of warranties are 3 years or 36,000 miles
for General, as well as 5 years or 60,000 miles for Power Train. Additionally, the company I ended up
purchasing from includes the first year of maintenance for FREE. I had to weigh my options, and decided that
it was in my own personal best interest to have a reliable vehicle, with an
excellent resale value. And after
shopping around, I was able to see that I could afford a new car, and then
began the next step in the car-buying process. First, I
chose 2-3 vehicles (different makes/models).
I did some comparison research on each one, to have an idea of what
options they have, and what prices to expect, and then I took a day to go to
Dealerships and test drive. This is one
of the most important steps, as you will be able to narrow your search just by
a simple test-drive. I went into the
process thinking I wanted one particular model more than the others, and ended
up changing my mind after the test drive, liking another vehicle much better.
An
excellent resource is the Consumer Reports Car-Buying issue (showing Pros and Cons of different vehicles), check your local
library or their website: http://www.consumerreports.org/cro/index.htm
There are
multiple websites that can help you compare pricing in your local area: True Car https://www.truecar.com and Edmunds www.edmunds.com/
These websites can show you what
other people have purchased specific vehicles for most recently in your local and surrounding areas. And you can use this information to your
benefit when negotiating with the Car Dealerships. This also works for Used Vehicles. Interestingly enough, when I was car
shopping, I ended up negotiating with at least 4 different dealerships. You do not have to feel loyalty to one
particular dealership, even if you did test-drive with them. Many of them will negotiate with you via
email or text, so that is even easier for communication, less intimidating,
very simple and to-the-point. In the
end, I purchased my vehicle from a Dealership in another City from a Salesman
that I never met, and they delivered it to me at my home, which is over 90
miles from the Dealership. I had no idea
this was an option before beginning this process! Since I didn’t have a car at the time, when I looked online at
Dealerships in other areas, I checked for Free Vehicle Delivery. I even negotiated for All-Weather floor
mats! I told the Salesman that was
giving me the best price, “If you throw in the all-weather floor mats, we have
a deal,” and it worked!
Tip # 5: Don’t give too much
information; there is power in your silence. At the car dealership, you may be asked, “How
much do you want to pay per month?” They
don’t tell you their lowest price; they want to know your highest price! So, use your power of silence and don't say a number. Just say that you are not interested in
purchasing anything today, you’re just beginning to shop around. Once you remove that lingering pressure for
purchase, you are free to ask questions about the vehicle and make your
comparisons, also that way the Salesperson is aware of your intentions. Now, during negotiation,
you will have to talk price. And when
Salesmen told me their price, I would ask if they could come down from that
price because it was too high for my budget.
Most likely they will say, “What number are you thinking you want to
pay?” I would then say a price and most
times, they would say that it was impossible.
I presented one particular Salesman a quote from another Dealership to
show that it was possible, and they did come down to meet that number! Now, it did
take a day or two for their response, however they did meet my “impossible
price”…this is the time when you really have to be patient.
Tip #6: Be sure to research the
offered warranties and see what is best for your needs. The Finance Manager will most
likely try to convince you that you need many additional extended warranties,
which will drive up the price. Be
prepared for this conversation, do your research ahead of time. In my case, I decided that I only wanted the Road Hazard
package for the tires. I made it very
clear to the Dealerships during negotiation that I would only be purchasing the
Road Hazard warranty and that helped take the pressure off of having to say
“no” so many times. These extended warranties may be something that you are interested in purchasing, just be aware it will raise the price of the vehicle.
Bottom
line, it is always best to educate yourself, just try not to get overwhelmed,
because it is a lot of information to process. My
negotiations lasted 4-5 days after almost one month of research, and I had
moments of frustration but, it was all worth it when I finally negotiated the
deal that was best for me. Once you
realize you have the power to say yes or no, you take control of the entire process.
