So, you’ve decided it’s time to buy a new car. New or used, you know what you want; make, model, features. You’ve planned out your budget, and done your research; you are ready to go buy that car! Before heading to the dealership and signing on the dotted line, take a few minutes to learn the 10 phrases to avoid when buying a car.
“I’m trying to keep my monthly payments down.”
- “I’m trying to keep my monthly payments down.”
- “Honey, what do you think?”
- “I have a car to trade in; how does that affect the deal?”
- “Let’s talk financing!”
- “Here’s how much I have to spend.”
- “What kind of extended warranties do you have?”
- “I need this car now.”
- “I think my credit’s good.”
- “It looks like it has been kept pretty well.”
- “I guess all these fees are pretty standard, huh?”
There are a lot of ways a dealer can lower your monthly payments, but this usually means extended loans, costing you more in the long run. A dealer can easily drop your monthly payment from $400 to $300 by adding a year or two to the term of your loan, but this could end up costing you thousands extra in interest. Make sure you know and are clear to your salesperson what the maximum you are willing to spend over the life of the loan.
“Honey, what do you think?”
Dealers are excellent at playing couples against each other and often are able to talk the buyers into things they would not have otherwise considered. If one of you gets emotionally attached or excited about a specific vehicle, it is much harder to keep your negotiating power. It is important that couples walk into the dealership on the same page. They should have a very good idea of the make, model, and features they are interested in, as well as, how much they are willing to spend. If a couple needs to discuss an issue, ask for some time alone to talk. Talk through your issues and come back united.
“I have a car to trade in; how does that affect the deal?”
By making one deal contingent on other gives the dealership more leverage when negotiating. Wait until after you have settled on a price for the car you are buying. Make sure you not only research the price of the car you are purchasing but also of the car you are wanting to sell. In most cases, you get a better price for your car by selling it yourself. A trade in is convenient but not always the best option.
“Let’s talk financing!”
This is another time when it is important to settle on a price first. The rate of the loan shouldn’t influence the price of the car. Often times you can get a better loan from a bank, credit union or online lender. Showing up to the dealer with a pre-approved loan, gives you more negotiating power.
“Here’s how much I have to spend.”
Coming right out with the amount you are willing to spend could cost you thousands of dollars. If you let the salesperson know how much you are willing to spend, they are most definitely not giving you a lower offer. Discuss the car and options you are interested in first, then let the dealer make the first offer.
“What kind of extended warranties do you have?”
Treat extended warranties like insurance and shop around. Often times third party companies can give you a much better deal. Also, by purchasing an extended warranty you are questioning the reliability of the vehicle. It may be a better idea to put the money you would have spent on the warranty into savings for futures repairs if needed. If you don’t feel comfortable not having the warranty, consider a policy from your insurance company, which usually cost around $100 a year.
“I need this car now.”
Having the leverage to walk away gives you incredible negotiating power. By showing the need for urgency, the dealer is less likely to come down on the price. The urgency of selling the car should be on the dealer as they need to move inventory quickly.
“I think my credit’s good.”
You should know your credit score before you even step foot into the dealership. It is law that everyone is entitled to one free credit score each year. Knowing you credit score beforehand can prevent your salesperson from setting unfavorable terms with stories of bad credit and finance struggles.
“It looks like it has been kept pretty well.”
When buying a used car, a look under the hood is never enough to know if the car has mechanical issues or not. Always have a licensed and neutral mechanic do a full inspection. These normally run between $50 and $90 but could save you thousands in repair costs down the road. If the dealer tries to steer you away from this or insist on an in-house inspection, walk away!
“I guess all these fees are pretty standard, huh?”
It depends on the fee. Sales tax, title, registration and delivery fees are usually set but watch out for other fees. Ask the dealer to remove any taxes such as “dealer prep.” Read over your contract carefully and ask questions about any extra fees you may not understand. If they don’t seem necessary, ask for them to be removed.
Remember, to always do your research and walk into the dealership prepared. If things aren’t going the way you’d like, it is important to be prepared to walk out. Shop around and find a dealership that is willing to work with you not against you.
Original article here: http://editorial.autos.msn.com/listarticle.aspx?cp-documentid=765384