Got a case of new-car fever? It can really make you dizzy. All the choices, features, makes, models, and colors! Nothing throws cold water on that fever worse than looking at that sticker price and calculating monthly car and insurance payments.
Before that new-car smell intoxicates you on a test drive, be prepared to move the numbers in your favor with these four hints to negotiate the lowest car price at dealerships or with private sellers.
When you have your eye on a new or used car it makes sense for you to find out all the facts about it before you negotiate a price. Read reviews and understand the features that attract you to the car. This helps you be on equal footing with the salesperson or seller. You’re less likely to be distracted or confused by hype.
If buying a used car, research the Kelley Blue Book value. Also look up the value of your own trade-in vehicle if working with a dealership. If a dealer isn’t willing to give you a good trade-in value, walk away and sell it elsewhere.
Find forums and review sites that share owners’ experiences with the make and model you’re considering. See if there are recurring issues with maintenance problems and repairs.
If you’re negotiating with a private seller about a used car, be sure to ask why they want to sell the car. Ask for all vehicle history reports available about repairs, accidents, etc. If there are cosmetic problems with the car, remember they can always be fixed and won’t affect the car’s performance. Be more concerned with the engine and the electronics.
The seller should be willing to let you have the car inspected by a mechanic you trust before you make a commitment to buy. The result of the inspection could give you some negotiating power.
There are a lot of benefits to being preapproved for a car loan before you begin negotiating a price. First of all, you’ll know upfront of any credit history issues or errors you may have and have time to take care of them. You’ll also get a clear picture of what you can afford before you get in too deep and become emotionally attached to a dream car.
A general rule of thumb is that car expenses should be at or less than 20% of your take-home pay. These expenses include not only your monthly car payment, but your car insurance (remember, new cars cost more to insure), gas, and routine maintenance as well.
By having your auto loan secured with a reputable financial institution or credit union, you can also let the seller know that you’re able to afford the car and not be influenced by any financing negotiation within a dealership. Dealers love to play around with financing. For instance, they may show you a sweet low monthly payment, then tell you it’s for six years or more! You really don’t want to still be paying for a car when you’re ready to move on to a new model.
Don’t walk away from the car you want just because the price on the sticker scares you. Think of it as a starting point for your conversation with the seller. Let the seller know of your interest, but that you’re looking for a better price. It’s smart to talk to more than one seller and let each know you’re shopping around. A little competition can work in your favor.
Keep a poker face. Don’t let on too many details of your desires. Let the seller do the talking.
Also, be prepared to walk away, even if you’re absolutely dying to have the car! One thing is certain, there will always be another car to fall in love with. And don’t be surprised if you get a call from the salesperson with a better price or maybe something else to sweeten the deal like a set of new tires.
Never underestimate the power of cash. Especially if you’re buying a lower priced used car, you sometimes have more negotiating power if you’re paying with cash. Skip the middleman and all the financing terms and conditions talk.
With a personal loan you can receive your cash quickly to use however you like and then repay it at a fixed rate for a predetermined length of time. This is a much better and more stable method than paying with a credit card where rates rise over time.
Cash is preferable to the seller. It’s a sure thing. And if you don’t like the way your negotiations are going, you take the money off the table and go home.
When you’re ready to get the wheels rolling on your new car dreams, talk to your friends at Regional Finance about a fixed-rate personal loan to give you the negotiating power you need. We’re always here with ideas to keep your budget manageable and your life a little easier.
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You can prequalify for your loan online in just minutes. Or, if you prefer, call or stop by your local branch. Our loan specialists can answer any questions and help you fill out an application for the personal loan that fits your needs.