Three Tips to Help Negotiate Buying a Car

Buying a car is a rite of passage, and for some, it can be intimidating. We reached out to a few former car salesmen to give us some easy tactics that can help save money and give you leverage in a negotiation. These tips won’t mean you can get a brand new luxury car for half-off, but they should allow you to shave a few hundred dollars off.

Timing

Timing matters. Don’t agree? Go check out the prices of Halloween candy on November 1st. There are certain deadlines and realities you can take advantage of when buying a car. New model years roll out in October and November, so consider getting last year’s model right as the new ones are hitting the lot. The dealer will want to get rid of them to make room for new inventory, and you’ll still be getting a new car.

If you’re buying used and not worried about what year, or if you just want to add some extra leverage to the negotiation – go at the end of the month. Car salesmen almost universally work on commission, and they all have monthly quotas. Coming down a few hundred dollars on a sale price only means sacrificing a few dollars commission, but hitting the quota likely means a substantial bonus. Salesmen who are close to hitting their quotas will make this tradeoff every time.

Location

Ever tried to buy gas in a big city, or a remote location like an island beach? It’s expensive for a number of reasons, some of which extend to the cars that require said gasoline. Consider leaving the city or suburbs for a more remote dealership. They have much less volume, so the business means more to them. Consider calling ahead and letting them know that you’re coming from a distance – it adds pressure because they know you probably won’t be back.

Additionally, if you live near a state line there are often radical differences in price. Consider crossing state or county lines if there are consistently better deals outside of your own zip code.

Dealership

This seems counterintuitive – because you’ll probably get a better sticker price from a private seller. The problem is if anything goes wrong: you’re on the hook. You’d need to pursue legal action on your own, or just hope that the seller is a good person – which is not always a great thing to be relying on.

Dealers also offer great warranties on used cars that even extend to the wheels and tires, and these investments often pay for themselves.

Remember to focus on the purchase price, not the payment. Salesmen can usually achieve the desired payment by extending the terms of your loan, but this often ends up in a higher out of pocket expense for you. If the salesman insists on talking payments, just find a better dealership.

Even if you aren’t a shrewd negotiator, you can employ these strategies to give yourself the best chance at a good deal during your next car hunt. Let us know in the comments if you’ve tried anything that’s helped you get a better price when shopping for a car.

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2 Comments
  • Dealer warranties can be negotiated.

  • Regarding location. While going outside a city might work, when I bought my new car, I looked at every dealership and the higher-end city dealership offered me the best price and had the best selection of colors/options. And they did it quickly. They said that because they were high volume sellers, they were able to offer lower prices because they were benefiting from the volume. I ended up buying the newly released 2013 model for cheaper than all the other dealerships offered me for the last of their 2012’s (that weren’t even the color I wanted).

    Most important: Find a dealership that has a good service department, whether you bought the car there or not. Go in and talk to them. Some of them are terrible. Some are great. Ask any random questions just to see how they respond. See if they always have some bs answer or if they genuinely try to get you an answer or admit if they don’t know. Why? Because those people are the ones that have the leeway to help you or not care if something unusual happens and you get ripped off. Read bad car reviews and it always has to do with the service department. They have options. Once you’ve experienced a bad dept versus a good one, you realize it makes all the difference. (Also remember that service departments in more expensive neighborhoods depend on their excellent customer service and their prices aren’t necessarily higher — no one likes getting ripped off.) My 2 favorite service depts have been smaller ones (2-3 service reps) vs the huge operations.