If you step up to the cashier at your local store with a packing of tea and say “It says $10.15 on this sticker, but I`ll pay you only a half”, you`d probably have to go without your daily dose of caffeine. If you walk into McDonald`s and say “I`d like to have this cheeseburger at a fraction of its cost” you`d remain hungry. But if you walk into an auto dealership, you are expected to haggle with the salesperson and get the best deal on your new ride.
The manufacturer`s suggested price (MSRP, or “sticker price”) includes hundreds and even thousands of dollars of dealership`s profit. When you pay sticker price, you hand this huge profit to the dealership on a silver plate. Car shoppers need to negotiate a bit to get the best price.
Negotiating a car price can be pain-free process, if you know exactly how to do it. Whether you are a negotiating novice or a seasoned haggler, the following tips will help you to get a vehicle at a good price.
Don`t Give the First Number
How much are you willing to pay? You may have heard this question multiple times. But have you ever thought about why answering this simple question with a dollar figure handicaps you from the very start? Don`t give the first number because your price could actually overbalance the vehicle`s lowest possible selling price. For instance, if a sticker price of the vehicle is $16,000 and you tell the salesperson that you can pay $14,000, you might suppose you have scored a deal, whereas the dealer may have been willing to decrease the price even more if given the chance.
Let the dealer disclose the first number. Reply the salesperson`s question by asking for the dealership`s «best price». This is a good point to start bargaining, and it will give you a better understanding of the price the dealer will accept.
Buyer, beware! Salespersons are masters of psychology, they know if people are nervous they talk excessively and may blurt out something that they can use to get more power in a negotiation. For instance, your sentence “I need the vehicle right now” may be a signal to the salesperson that you are ready to pay higher price. So, do everything to calm down and refrain from saying anything that the salesperson can use to gain a point in a negotiation process.
Never Negotiate Based on Monthly Payment
For many car shoppers, the most essential aspect of a vehicle purchase is how much it will pull out of their monthly earnings. However, when bargaining a purchase price, refrain from negotiating in terms of monthly payments. Customers appeased with a low monthly payment often overlook such «minor» details as stretched loan term or swelling interest rate.
Watch All Areas of the Foursquare
«Four-square» is a worksheet a salesperson use to map out the major factors of a car deal – vehicle price, down payment, trade-in value and monthly payment. You may get the dealership to accept less of a down payment, or give you a good deal on your trade-in, but the salesperson will inflate new-car price or your monthly payments instead. Don`t overlook two critical numbers – loan term and interest rate – your monthly payments and total amount depend on them.
Don`t Hesitate to Walk Away
In some cases, it can be difficult for a car shopper to walk away from the dealership as he has become a little attached to a certain vehicle. This big mistake should be avoided at all costs. When your are purchasing a car, don`t get too emotional about one vehicle at the dealership, otherwise you`ll lose advantage in the negotiating process. If the salesperson even suspects you only want one car, chances are too low the dealer will drop the price.
Even if you think that you have found the car you`ve dreamt about, don`t show it. Negotiation is a deal, and it should be treated correspondingly. Don`t lose the upper hand letting the dealer know you have become attached to a certain car.
If you are not satisfied with the negotiation, we strongly recommend walking away, and looking for the desirable deal somewhere else.
We hope our tips will help you head in the right direction to get the best deal possible on your new ride.
If you rights were violated when buying a car don`t hesitate to contact the Margarian Law Firm at (818) 553-1000 to have legal consultation.