Do Your Research First
Before setting foot in a dealership, it’s important to do your homework. Decide what kind of vehicle you need based on your lifestyle, budget, and preferences.
Then research different makes and models that fit your criteria. Compare stats like fuel economy, horsepower, cargo space, and safety ratings.
Check out online reviews and forums to see what existing owners have to say about the vehicles you’re considering. Look up the dealer invoice price and fair market value so you understand what a reasonable offer would be.
Knowing the specifics about the cars you’re interested in and what constitutes a good deal will make negotiations easier.
Get Pre-Approved Financing
Secure car buying service before talking figures with the dealer. This allows you to know how much you can afford to spend and locks in an interest rate.
Dealers make a lot of their profit from financing, so if you already have a loan lined up from your bank, credit union or online lender, they won’t be able to upsell you on extra products or a higher rate.
Getting pre-approved also strengthens your negotiating position. Since you already have financing, the dealer will know they can’t inflate the price to compensate for giving you a better rate. Come armed with your pre-approval letter to show you’re serious.
Consider Certified Pre-Owned
CPO vehicles can be a smart alternative to buying brand new. CPO cars have undergone rigorous inspections and come with extended warranty coverage. Since they’re a couple years old, you avoid the initial depreciation new cars face as soon as they’re driven off the lot. The late model CPO options often still have that new car feel and the latest tech features.
Shop certified pre-owned inventory at dealerships for the makes you’re interested in. Be sure to verify the included warranty coverage, as this can vary. CPO cars tend to have very low rates, so factor potential financing terms into your decision.
Test Drive Before Buying
Never purchase a car without test driving it first. This is the best way to determine if a particular model suits your needs and preferences.
Pay attention to how comfortable the seats are, visibility out the windows, and how smoothly the engine accelerates. Check that all features and controls are intuitive. If you’re shopping family vehicles, make sure there’s sufficient legroom and cargo space.
Ask the dealer for an extended test drive so you can simulate your normal driving routine. Get the car out on the highway to test passing ability.
See how it handles bumpy roads. Make U-turns to check the turning radius. Don’t feel pressured into buying until you’re 100% certain it’s the right car.
Negotiate the Final Price
Once you’ve settled on the specific vehicle you want, it’s time to haggle over the price. Don’t divulge your budget or maximum spend upfront – let the dealer make the first offer.
They may start higher than the fair price. Counter with a low bid, then negotiate up incrementally until you reach a deal both parties can accept.
Point out any flaws or wear-and-tear discovered during the test drive to ask for a further discount. Mention any competitive offers you’ve received to add incentive for the dealer to sweeten the deal. Be prepared to walk away if you can’t agree on a fair price. There will always be more cars to choose from.
Read All Paperwork Carefully
Before finalizing the sale, carefully go over the purchase agreement and financing contract. Make sure all negotiated terms are correct.
Watch for any unwanted add-ons like extended warranties, wheel insurance or service plans. Decline anything you didn’t explicitly agree to – most are pure profit for the dealer.
Also verify the APR, monthly payment, loan length and other financing details even if you brought your own pre-approval. Mistakes can happen.
It’s much easier to spot and fix errors now rather than after the fact. Never sign contracts that still have blank fields – make sure everything is filled in.
Enjoy Your New Ride!
Follow these tips and you’ll be able to negotiate an excellent deal on your next car. Do the prep work upfront to determine your needs and budget range. Shop multiple dealers to compare pricing and test drive offerings.
Avoid impulse buys and be ready to walk away if you can’t get satisfactory terms. Carefully inspect all paperwork before signing and sealing the purchase. Then you can hit the open road happy in your new set of wheels!
