car dealerships http://www.wisebread.com/taxonomy/term/532/all en-US 6 Smart Auto Finance Options http://www.wisebread.com/6-smart-auto-finance-options <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-smart-auto-finance-options" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/buying_new_car_000033988744.jpg" alt="Learning smart auto finance options" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Finding the right auto financing is one of the most important parts of the car buying process. But how do you figure out which option is right for you? We've come up with some general guidelines to help you find the best financing for your budget, credit, and personal needs. (See also: <a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know?ref=seealso">17 Things Car Salesmen Don't Want You to Know</a>)</p> <h2>1. Direct Lending Options</h2> <p>Some of the best sources for direct lending include banks, credit unions, and private online dealers. You may want to start your search with any bank or credit union that you already have a relationship with. If you have good history with them, they will likely have special offers on auto financing. If you receive offers from private online lenders or dealerships that you aren't familiar with, make sure to look them up on the Better Business Bureau to ensure they are reputable.</p> <p>When you get a loan directly from a bank or credit union, you may have more flexibility with the dealership. They might work harder to beat the deal you have and offer even better rates. By having an auto financing deal set up before you visit the dealership, you can focus on getting the best price for your new car and the highest price for your trade-in, rather than having to worry about haggling for better financing offers.</p> <h2>2. Benefits of Going With the Dealership</h2> <p>According to the Center for Responsible Lending, eight out of 10 car buyers choose to finance with the dealership. That's partially because choosing the dealership's financing can provide more than just a better APR. For instance, it will be easier for you to negotiate a lower price if you are also working with the dealership on financing. Your business will be even more important to them, so they may be willing to work with you on the total cost of the vehicle, or even throw in some free upgrades.</p> <p>It is often easier to get approved for a loan through a car dealer. However, they don't always have the best rates available, so you may save more with direct lending through a bank or credit union. Before you head into the dealership, it's helpful to have another financing offer in hand. Even if you choose to go with the dealership's financing, you'll have a rate for them to beat.</p> <p>The dealer may be able to offer special manufacturer incentives, such as lower APR, no down payment offers, or cash back. You may also be able to negotiate the APR, loan term, or monthly payment. Even if you do decide to finance with your dealership, going in empty-handed will make you an easy target.</p> <h2>3. Know What You Can Afford</h2> <p>When comparing auto financing offers, there are certain things you will want to take note of, including:</p> <ul> <li>Annual percentage rate (APR): A lower rate will save you more money.<br /> &nbsp;</li> <li>Loan term: A shorter term means higher monthly payments, but less interest paid overall, and possibly a lower APR. Most dealerships offer loan terms between 36&ndash;60 months.<br /> &nbsp;</li> <li>Down payment: The higher your down payment, the shorter your loan term will be, and you may possibly enjoy a lower APR.<br /> &nbsp;</li> <li>Monthly payment: This will be affected by the APR, loan term, and down payment.</li> </ul> <p>Keep in mind that determinants like the length of the loan term and how much of a down payment you can afford will change your monthly payment and the APR. For instance, if you can put down a larger down payment or pay off the loan faster, the interest rate will likely go down.</p> <h2>4. Know Your Credit Standing</h2> <p>Your credit is a huge determining factor of how good a financing offer you will receive. If you aren't sure of what your credit is looking like, visit AnnualCreditReport.com for your free credit report. If you notice any errors, make sure to have them corrected before you apply for auto financing.</p> <p>If you have bad credit or no credit at all, there are still loan options available to you. However, you may not be eligible for favorable rates or loan terms. If you need a car now, consider getting the best loan available to you at the moment and then refinance it in the future when your credit has improved. You might also consider applying with a co-signer.</p> <h2>5. Shop Around</h2> <p>Don't settle for the first offer you find. In fact, you should have at least three offers in hand before visiting a dealer. Make sure you have done your homework and compared various offers before stepping foot into the dealership. This will give you more bargaining power and a greater understanding of what to expect.</p> <h2>6. Lease It</h2> <p>When all else fails, you can lease. This is similar to a long-term rental agreement. This is a great option if you aren't concerned about owning a car, or if you like to frequently upgrade your vehicle.</p> <p>You will receive various leasing offers from the dealership based on your credit and ideal loan term. Be sure to consider the number of months and miles that you need the vehicle for. At the end of the lease agreement, you may be able to buy the vehicle at an agreed-upon discounted price, or you can simply return it and pay any remaining fees.</p> <p><em>Do you have other tips for finding the right auto financing offers? Please share your thoughts in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/6-smart-auto-finance-options">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easy-ways-to-calculate-your-new-car-budget">7 Easy Ways to Calculate Your New Car Budget</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know">17 Things Car Salesmen Don&#039;t Want You to Know</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-self-employed-persons-guide-to-getting-credit">The Self-Employed Person&#039;s Guide to Getting Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-you-need-to-know-before-leasing-a-car">What You Need to Know Before Leasing a Car</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation auto financing car dealerships credit leasing loans price comparisons Tue, 22 Dec 2015 22:00:04 +0000 Andrea Cannon 1621621 at http://www.wisebread.com A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them) http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/car-salesman-151336938-small.jpg" alt="car salesman" title="car salesman" class="imagecache imagecache-250w" width="250" height="146" /></a> </div> </div> </div> <p>Used car salesmen are generally portrayed in the media as sleazy, greasy guys in too-tight polyester suits that are trying to take you for a ride &mdash; and not just in that lemon sitting on the lot. Of course, not all used car salesmen fit that stereotype, but at least part of that image is accurate: There are dirty tricks that they're putting into action to get that bill of sale signed&hellip; by you. (See also: <a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know?ref=seealso">17 Things Used Car Salesmen Don't Want You to Know</a>)</p> <p>Jason Lancaster made a living as a used car salesman for a decade &mdash; at an &quot;upstanding dealership,&quot; he says &mdash; but he's now committed to exposing the less-than-ethical business practices because he believes that &quot;customers deserve better.&quot; He left the car business in 2007 and started a website &mdash;<a href="http://www.accurateautoadvice.com">Accurate Auto Advice</a> &mdash; devoted to sharing accurate advice and information with consumers. According to Jason, &quot;The mission of the site is to give consumers advice that's 100% true. A lot of the info I see about car buying is false or misleading, and I'm trying to correct that.&quot;</p> <p>Lancaster exposes some of the more dastardly car-buying schemes in the following four tactics &mdash; and some advice about combatting them.</p> <h2>1. The Scream</h2> <p>Think of &quot;The Scream&quot; tactic as a riff on the good cop/bad cop scenario. The gist of it is that the buyer wants a certain car or a certain price that the dealer doesn't have or can't match. At the same time, the buyer says that they're not ready to buy at the moment. Instead of sending the buyer on their way without any hope of getting what they want &mdash; which, in truth, isn't available &mdash; the salesperson plants a seed that what the buyer wants may be available when he or she is ready to buy and suggests that they contact the dealer before they make any decisions at another dealer.</p> <p>&quot;Then, you sit back and wait for the phone call,&quot; says Lancaster. &quot;If the customer calls you for an unbelievable price, you tell them that you remember what they want and they need to come in to complete the deal. They come down to the dealership believing that you're going to meet their price, get their car, etc., and THEN you tell them the bad news.&quot;</p> <p>That's where the namesake &quot;scream&quot; comes in. Angry that they came back to a dealer that isn't willing to give them what they want when it was suggested that they would, the buyer, in theory, takes their frustration out on the salesperson &mdash; or the bad cop, if you will. And that's when the good cop &mdash; the manager, in most cases &mdash; comes in to seal the deal.</p> <p>Lancaster continues, &quot;The manager comes over, apologizes, then explains how the customer wanted a price that wasn't realistic (or a car that isn't available), that $XX is the very best price there is, offers to throw in a freebie, and makes the deal. If the salesperson is sufficiently scolded, and the manager is good at calming people down, it can work OK.&quot;</p> <p>The problem with this scenario, as Lancaster points out, is that the buyer no longer trusts the salesperson, which means that they'll never come back to them again. &quot;It's great in the short term, but really damaging to the dealership in the long term, so a lot of dealers won't permit it.&quot;</p> <h3>How to Avoid The Scream</h3> <p>First, don't let on that you're not ready to buy right now. That's basically where this scheme begins. Instead, inform the salesperson that you're looking for a car, and you want to find the best price possible, so you're keeping your options open by visiting other dealerships.</p> <p>To flip this tactic on its head altogether, round up a few prices on comparable cars from area dealers and bring them to the table with each salesperson. If the salesperson doesn't want to be competitive, and you don't feel like you're getting the best or fairest deal possible, walk. Simple as that. If they want your business, they'll work with you to find the most reasonable deal for the dealership and for you.</p> <h2>2. Rolling a Car They Know You Can't Finance</h2> <p>What's a dealership manager to do when he wants to move a vehicle off the lot, but he's dealing with a buyer who won't agree to make a sufficient or realistic down payment or who has bad credit with no chance of getting a good finance rate? Lancaster says there are two choices:</p> <ul> <li>The salesperson can tell the buyer what a realistic interest rate will be, and what that means for their payment; or<br /> &nbsp;</li> <li>The salesperson can tell the buyer whatever they want to hear about interest rates, have them sign paperwork and take delivery, then call them back in a week or so and tell them the terms have changed.</li> </ul> <p>Did you just have a WTF moment, too? Truth is this tactic works &mdash; and it's still used fairly often for three important reasons, according to Lancaster:</p> <ol> <li>People want to believe the dealer tried to get them a good interest rate, says Lancaster. &quot;If you bring them back, show them all the decline notices from the banks, etc., you can prove to them that you tried. Then they'll admit their credit is bad and agree to a higher interest rate and payment.&quot;<br /> &nbsp;</li> <li>People usually show their new car off to friends and family, often the day they get it or the day after. Losing the car a week later would be embarrassing, so people will often pay more just to avoid that embarrassment.<br /> &nbsp;</li> <li>Most dealerships make customers sign something called a &quot;bailment agreement&quot; that says the dealership can charge a very high fee for the use of the vehicle if financing falls apart, according to Lancaster. &quot;When I was in the business, bailment was $50 a day and $0.50 a mile. If someone drives a car for a week, that's $500+. That's a big cash penalty a lot of people don't want to pay.&quot;</li> </ol> <h3>How to Avoid This Trick</h3> <p>To avoid the dealer changing your finance rate after you take delivery, consider these three suggestions:</p> <ol> <li>Secure financing before you arrive at the dealer; or<br /> &nbsp;</li> <li>Request that the dealer show you a copy of the bank approval (they can print it out and show you easily enough); and/or<br /> &nbsp;</li> <li>Don't sign a bailment agreement, at least not one that specifies payment of a penalty for miles driven and days of use.</li> </ol> <p>&quot;The bailment agreement is typically the first or last document the dealer will show you,&quot; says Lancaster. &quot;If you see anything that says you agree to pay for vehicle use should financing fall through, don't sign it. However, understand that this may keep you from buying a car if you have poor credit. Sometimes, people with poor credit don't have much of a choice, unfortunately.&quot;</p> <h2>3. &quot;This Is the Finance Rate the Bank Came Back With&quot;</h2> <p>As you may know, dealers can make a percentage of a vehicle's interest rate if they can mark it up. One of the easiest ways to mark up interest rates is to bring a customer into the finance office, ask them a series of probing questions about their credit report, make a show of submitting something to &quot;the bank,&quot; then showing them a piece of paper and saying, essentially, &quot;this is what the bank came back with.&quot;</p> <p>Another dirty trick, of course, but it works.</p> <p>&quot;The customer assumes that whatever you're showing them is the actual interest rate they qualified for, not realizing that the dealership has marked the interest rate up 2% to 3%&quot; Lancaster explains. &quot;This is done all the time. Even at nice dealerships. Even today.&quot;</p> <h3>How to Avoid This Trick</h3> <p>The best way to avoid this trap? Join a credit union and ask them for pre-approval on a vehicle loan. Credit unions almost always offer excellent finance rates. From personal experience, I can tell you that my husband has done this in the past, and it's always resulted in a smoother negotiation. Lancaster echoes that sentiment and offers an additional tip: &quot;If you can't join a credit union, I'd go online and see what you can do to secure a loan from one of the lenders that partner with <a href="http://www.edmunds.com/">Edmunds.com</a>, <a href="http://www.cars.com/">Cars.com</a>, etc.&quot;</p> <h2>4. Failing to Disclose Damage</h2> <p>Prior damage to a vehicle will almost certainly play a part in your decision to buy a particular used car. But how do you know what that car has endured? Unfortunately there's no easy way to find this out &mdash; and it's not entirely the fault of the salesman or dealer.</p> <p>&quot;Depending on the damage and the state you live in,&quot; Lancaster says, &quot;dealers may not be under any legal obligation to disclose a vehicle's prior history. The vehicle could be a 'lemon' (manufacturer buy-back), it could have suffered damage while on the dealership's lot, it could have substantial body damage &mdash; and the dealership doesn't have to say a word about it.</p> <p>&quot;While a CARFAX report can help, CARFAX reports are often incomplete. I've seen CARFAX reports that are missing considerable information, to the point where it makes me doubt the quality of their service. In any case, dealers will lie about damage or problems because they're under no obligation to tell the truth, and the consumer can't prove the dealership lied after the fact.&quot;</p> <h3>How to Avoid This Trick</h3> <p>So what can you do to at least try to get the most up-to-date, complete, and accurate information about the vehicle? The answer here isn't the most appealing, but it's sort of a better-safe-than-sorry situation.</p> <p>&quot;The best way to protect yourself is to pay for an independent vehicle inspection and buy a CARFAX or AutoCheck report,&quot; advises Lancaster. &quot;A good inspector can usually spot a vehicle with undisclosed damage, and CARFAX/Autocheck reports are usually good about indicating if a car is a manufacturer buy-back (AKA someone else's lemon).&quot;</p> <p>If you choose to go this route, there are mobile used car inspection services in most medium-sized cities. If you live in a small town, you can take your car to the nearest independent mechanic and ask them to look it over.</p> <h2>How to Beat a Used Car Salesman</h2> <p>In addition to revealing these trickster tactics, Lancaster also has advice for car buyers, so you can walk into the dealership knowledgeable and (hopefully) maintain the upper hand.</p> <h3>Buy From a Reputable Franchise</h3> <p>Buy from a franchised new car dealership, as most of these &quot;tricks&quot; won't fly. New car dealers are carefully monitored by state authorities and the automakers they represent, so they're very careful.</p> <h3>Get It Inspected</h3> <p>Have whatever it is you're buying professionally inspected. It costs $100 to $150, and it's worth every penny.</p> <h3>Secure Financing First</h3> <p>Arrange financing at the local credit union then ask the dealer if they can beat that rate. Outside of a credit union, most of the larger banks have some sort of auto finance program, and most of the popular car sites have a partnership with finance companies.</p> <p><em>Have you ever scored a great deal on a used car from a dealership? How did you do it? Please share in comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-warranties-that-arent-worth-it">4 Warranties That Aren&#039;t Worth It</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/save-on-your-new-car-send-mom-not-dad-to-the-dealer">Save on Your New Car: Send Mom, Not Dad, to the Dealer</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-is-gasoline-so-cheap-a-cost-comparison-of-40-common-household-liquids">Why is Gasoline So Cheap? A Cost Comparison of 40 Common Household Liquids</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/car-buying-part-2-into-the-devils-domain">Car Buying Part 2 – Into the Devil&#039;s domain.</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-gaming-mice">The 5 Best Gaming Mice</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Shopping car dealerships Cars scams shopping used car Thu, 03 Jul 2014 13:00:04 +0000 Mikey Rox 1153218 at http://www.wisebread.com 5 Questions to Ask Before You Buy a Used Car http://www.wisebread.com/5-questions-to-ask-before-you-buy-a-used-car <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-questions-to-ask-before-you-buy-a-used-car" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/8135309893_9a82eb9dc3_z.jpg" alt="car" title="car" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>Spring is a time when the used car market sees an uptick in activity. Tax refunds are in hand, the sun is shining, the open road beckons, and folks start to stroll through used car lots with a gleam in their eyes. But before you start test driving and haggling, take a moment to prepare and clarify what kind of car you need and what you can afford. Here are five questions to ask yourself before you buy. (See also:&nbsp;<a href="http://www.wisebread.com/guide-to-buying-a-used-car-without-going-crazy">Guide to&nbsp;Buying a Used Car Without Going Crazy</a>)</p> <h2>1. Have I Done My Research?</h2> <p>There are volumes of information online about specific automobile makes and models. If you have a particular car in mind, check out sites like <a href="http://www.edmunds.com/">Edmunds.com</a> or <a href="http://www.kbb.com/">KBB.com</a> for expert and consumer reviews that include safety features, performance, dependability, fuel economy, etc. Pay close to attention to the qualities that matter most for you and your family.</p> <h2>2. How Much Can I Really Afford?</h2> <p><a href="http://www.wisebread.com/how-much-car-can-you-afford">Determine how much you can afford</a> for your new set of wheels. Remember to factor in tax, title, and license fees; costs related to changes in insurance coverage; and any immediate upgrades the car may need such as new tires. Whether you&rsquo;re paying cash or financing, err on the side of a conservative estimate and always leave room for contingencies.</p> <h2>3. What Best Suits My Lifestyle?</h2> <p>A great value is always tempting, but don&rsquo;t lose sight of what fits your lifestyle.</p> <ul> <li>Will you be transporting precious cargo (people, pets, or stuff)?<br /> &nbsp;</li> <li>Do you have older parents or in-laws who may need a car that sits a bit higher and is easier to get in and out of?<br /> &nbsp;</li> <li>Do you need a hatchback for hauling?<br /> &nbsp;</li> <li>Or maybe a four-wheel drive for steep terrain or challenging winters?<br /> &nbsp;</li> <li>Do you have a small business that might benefit from a mini-van or small truck?</li> </ul> <p>Explore all the available options and find what suits you best now, with an eye toward the future.</p> <h2>4. What Will the Maintenance and Repair Costs Average?</h2> <p>Many people focus only on the upfront costs of buying a used car and don&rsquo;t really consider the unplanned or recurring costs. No car runs perfectly all the time, so factor in repair expenses as you shop for what you can afford.</p> <ul> <li>What are the repair cost averages in your area for foreign and domestic models?<br /> &nbsp;</li> <li>Would finding a regular mechanic for a non-domestic car require a long commute?</li> </ul> <p>Also, earlier model cars typically have fewer frills and creature comforts, but that means fewer high-tech engineering features under the hood that can be expensive to maintain, repair, and replace. Take a comprehensive look at the total cost of ownership and decide what works best for you and your resources.</p> <h2>5. Is the Dealership Reputable?</h2> <p>If you&rsquo;re <a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know">buying from a dealership</a>, a bit of research can go a long way. Do some online sleuthing to see what customers are saying about their experiences with a particular used car dealership.</p> <ul> <li>What has the post-buy customer experience been like?<br /> &nbsp;</li> <li>How has the business responded to customer complaints and helped to resolve issues?<br /> &nbsp;</li> <li>Are there any pending legal issues with the business?<br /> &nbsp;</li> <li>Are customers willing to refer friends and family?</li> </ul> <p>Once you know the answers to these five questions, you&rsquo;re in the driver's seat and in a much better position to make the right choice. Remember, a bit of due diligence and strategy ahead of time will help ensure that your new car is a perfect fit now and still a great value when you decide to sell it later. Drive safe!</p> <p><em>Have you purchased a car from a used car dealership? What was your experience like?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kentin-waits">Kentin Waits</a> of <a href="http://www.wisebread.com/5-questions-to-ask-before-you-buy-a-used-car">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know">17 Things Car Salesmen Don&#039;t Want You to Know</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-jump-starter-kits">The 5 Best Jump Starter Kits</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-tell-if-a-car-service-plan-is-worth-it">How to Tell If a Car Service Plan Is Worth It</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-car-battery-warmers">The 5 Best Car Battery Warmers</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation buying a used car car dealerships car repair Mon, 01 Apr 2013 10:24:29 +0000 Kentin Waits 971381 at http://www.wisebread.com 17 Things Car Salesmen Don't Want You to Know http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/17-things-car-salesmen-dont-want-you-to-know" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/3666101234_f74fccb6a3_z_0.jpg" alt="car salesmen" title="car salesmen" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Regular readers of the content aggregator Reddit.com may have seen a post recently asking car salesmen <a target="_blank" href="http://www.reddit.com/r/AskReddit/comments/19996t/car_salesmen_of_reddit_whats_something_you_dont/">to confess their greatest fears</a>.</p> <p>The response was overwhelming; over 7,500 comments were posted. As I read through the list (it took hours!) I jotted down some recurring themes. From those notes I have identified car salesmen's 17 greatest fears and weaknesses. (See also:&nbsp;<a href="http://www.wisebread.com/guide-to-buying-a-used-car-without-going-crazy">Guide to&nbsp;Buying a Used Car Without Going Crazy</a>)</p> <p>If you're in the market for a new or used car anytime soon, this list could save you a lot of money. (By the way, I use &quot;salesman&quot; and &quot;salesmen&quot; but this obviously refers to both men and women in the auto sales force.)</p> <h2>1. Your Smartphone Is Your Most Powerful Weapon</h2> <p>Years ago, car dealerships and their sales force held all the cards, and buyers held very few. But that has changed completely. Now, with information and sites like Edmunds.com's <a target="_blank" href="http://www.edmunds.com/car-buying/how-to-use-tmv.html">True Market Value</a> (TMV), Autotrader, eBay Motors, and access to car experts in the palm of your hand, you have effectively marginalized the car salesman. You know what they paid for the car, what their mark up is, when they bought it, what their bottom line is, everything. You can, in essence, make haggling a thing of the past. However, if you leave your phone at home, then you better have a terrific memory and be able stick by your guns. Proof is power.</p> <h2>2. You Can Win the Game Before Setting Foot on a Lot</h2> <p>The Internet has done wonders for the humble consumer. With it, you can email 20 dealers within a 50 mile radius, tell them what you're looking for, and ask them to send you back a quote. From those quotes, pick the lowest couple and take those to any dealership you want. They'll usually be forced to match it, destroying whatever profit margin they were hoping for. And before you feel too bad, the dealerships get massive bonuses by hitting certain sales targets. They can give you the car at cost and still walk away with a nice pile of cash.</p> <h2>3. Be Wary of Salesmen Who Leave to Let You &quot;Talk it Over&quot;</h2> <p>I actually had this happen to a friend of mine, and I laughed when I saw it come up in the comments.</p> <p>If you somehow manage to get stuck in the salesman's office haggling over numbers, he may receive a call and leave to let you and your partner &quot;talk it over.&quot; This is an old trick that some dealers use to listen in on your conversation, letting them know instantly just what your bottom line is. If it happens, whispers or text messages to each other may be a good way to combat eaves dropping.</p> <h2>4. You Are Being Screwed on Your Trade In</h2> <p>If the car you're trading in is in good condition, you won't be getting a good deal on it.</p> <p>Sure, you're armed with the Kelley Blue Book (KBB) trade-in price and resale price, but those numbers are hogwash. Dealers use something called the National Automobile Dealers Association (NADA) database, which gives them a much more realistic idea of what they can get for your trade. Some of the salesmen reported KBB values that undervalued cars by $5,000 or more. Your best bet is to get a copy of the <a target="_blank" href="http://www.nadaguides.com/">NADA value for your car</a>. Or, if you can, <a target="_blank" href="http://www.wisebread.com/best-of-personal-finance-how-to-sell-your-car-on-craigslist">sell it privately instead</a>.</p> <h2>5. There Are Mark-Ups Aplenty on the Sales Stickers</h2> <p>Dealerships refer to them as &quot;bumper stickers&quot; because that's where they bump up the price of the car. Little extras like VIN etching, fabric protectants, sealants, and other &quot;must have&quot; additions can all be done by you at home, usually for way less. Ask to see the original invoice, and compare it to the bumper sticker. That's what you really want to look at. If they refuse, go elsewhere. And even then, the invoice doesn't tell the whole story. See fear number 10, below.</p> <h2>6. You Have the Power to Control the Sale</h2> <p>Those two things below your waist, called legs, are a sales weapon.</p> <p>If at any time you don't feel good about the sale, you can walk away. Often, the salesman will hit you with a much lower offer when you get up out of your seat and tell them you've decided against it. Remember, they can't do the deal without you, and <a href="http://www.wisebread.com/the-7-laws-of-negotiation">you are always in a position to say, &quot;NO</a>.&quot; You lose nothing but a few hours of your time; they lose a commission and a bonus.</p> <h2>7. The Dealership's Extended Warranties Are for Suckers</h2> <p>Even if you get the salesman to agree to a price that is basically what the dealership paid for the car, you still have to go to that back room; the room where the deal is sealed.</p> <p>Whether you lease, finance it, or plonk down a wad of cash, they'll try to push every single option they can on you. That includes an extended warranty that you can buy way cheaper from someone else. The dealership makes a lot of money on these service contracts. Don't fall for this. As one of the salesmen pointed out, the finance manager is actually a salesman, too. They're going to do whatever they can to squeeze more money out of you before you leave.</p> <h2>8. The Four Square Is Designed to Manipulate You</h2> <p>There have been many, many negative articles written on the four square worksheet, and with good reason.</p> <p>The four square sheet is a way for the salesman to &quot;play&quot; with the numbers and make you think you're getting a great deal. Usually, the first time they come to the table with it, the numbers are so insulting you'll want to walk out. That's intentional. They can't look like miracle workers if they give you a reasonable price. And then the numbers game is played out, but the price of the car rarely goes down more than a few bucks. However, there's a better way to show just how this is used to trap you into a price you really don't want to pay. <a target="_blank" href="http://arthurfontes.hubpages.com/hub/How-To-Use-The-Four-Square-System-To-Sell-Cars">Read this article,</a> written by car salesmen FOR car salesmen. It's quite an eye opener. And as one redditor advised, tell them not to bring out the four square worksheet or you're leaving. That puts you in a position of power, and they'll know you're no sucker.</p> <h2>9. Salesmen Have Ways to Mess With Your Head</h2> <p>You drive into a dealership with your trade in. The salesman looks it over, nodding, giving the usual chit chat. But he'll ask things like &quot;does it have power steering?&quot; or &quot;does it have a sunroof?&quot; He already knows the answer. He knows the spec of the car and what it's worth. He just wants you to say NO a lot. And by saying no over and over, you start to devalue your trade in, and expect less for it. Get the NADA value, and whatever he asks you, just keep that number in your head.</p> <p>Another method is taking the keys from your trade in before you sit down at the negotiation table. It's a lot harder to walk away when you don't have your keys on you. They know this, and will often give the keys to a third party, like their sales manager. Now, they have to hunt him down before you can get your keys, and that will take a while. Long enough for them to have another crack at you.</p> <h2>10. Never Offer to Pay Invoice for Your Vehicle</h2> <p>You hear people say it all the time. &quot;I'm paying invoice for that car, not a cent more.&quot; Well, go ahead, it's better than paying the MSRP. But very few people will pay MSRP anyway. And the invoice price of the car is not telling you the whole story. The dealership gets dealer holdbacks, customer rebates, and factory-to-dealer incentives. This is money they can take off the sales price and offer to you, but they won't just hand it over without a fight. These incentives are usually not even advertised, but they can save you thousands.</p> <h2>11. Never Talk About Your Down Payment Up Front</h2> <p>The salesman will ask early on &quot;how much are you going to put down?&quot; It seems like a reasonable question, but you're giving up a bargaining chip way too early. One story talks about an old man who had $10,000 to put down on a truck, and the dealership basically upped the price of the truck to offset that down payment. In effect, the old man threw it away. Wait until you know the &quot;Out the Door&quot; price of the vehicle before you talk about a down payment.</p> <h2>12. Monthly Payments Are Deceptive</h2> <p>You should have a figure in your head of what you can afford to pay for the car, NOT for the monthly payment. The reason is simple. A dealership can mess with the figures, the length of the loan, and the APR, and reduce your monthly payment, but you could end up paying even more for the car than you first agreed to. Look at the final cost, and only the final cost. If your monthly price for that is too high, you're spending more than you want to.</p> <h2>13. Hail-Damaged &quot;Bargains&quot; Are Marked Way Too High</h2> <p>If the cars at the dealership get hail damage, they're going to mark them down and sell them to you at a discount. Great, a bargain, if you don't mind the dents. But the dealership has insurance policies on the cars on the lot, and they've already been reimbursed for that damage. The dealership is not passing all of that on to you, so you're generating some nice profit for them.</p> <h2>14. Non-Factory After-Market Options Are a Huge Rip Off</h2> <p>Many dealers will add &quot;extras&quot; to the car that cost them pennies on the dollar. Pin striping, rims, spoilers, stereo systems, alarms, you name it, they'll throw it in.</p> <p>Negotiate from the invoice price, not the padded sticker price. You don't need to pay $250 for a few bucks worth of pin striping. You don't need floor mats that cost $200. If it's non-factory, ask for it to be taken off. All of it. Do it yourself, or <a href="http://www.wisebread.com/4-ways-to-find-a-reputable-mechanic">get a trusted mechanic</a> to do it. And you can also get your tinting and clear bras done elsewhere for around HALF the price the dealership will charge.</p> <h2>15. You Get the Best Deal From the Internet Salesman</h2> <p>This was the one point that kept coming up over and over.</p> <p>When you go through the Internet sales department, the dealership already knows that you know certain things. They know you're a savvy shopper, that you're looking around, and that you're comparing prices. The Internet salesman will start at a much lower price than the salesman on the lot. In short &mdash; don't walk onto the lot unless you're going in to meet the salesman you've been dealing with online.</p> <h2>16. Get Your Own Financing Before You Buy</h2> <p>You can negotiate way better terms in advance, with a <a href="http://www.wisebread.com/the-benefits-and-drawbacks-of-credit-unions">credit union</a> or another financial institution. Don't leave it up to the dealership; get this all pre-approved before you walk in.</p> <h2>17. You Can Cancel Those Service Contracts Within 30 Days</h2> <p>So you get caught up in the financial meltdown and agree to pay for a lot of extras, including the extended warranty, tire protection, and so on. Well, you are not stuck with them. You can cancel within 30 days and get your money back. You can also use this to your advantage. Agree to the service contracts if you get money taken off the price of the car. The dealership makes way more from the service plans than the car anyway, so they'll be happy to make the deal. When you cancel, you're in the money.</p> <p>There were many more tips in the <a target="_blank" href="http://www.reddit.com/r/AskReddit/comments/19996t/car_salesmen_of_reddit_whats_something_you_dont/">reddit.com thread,</a> which I urge you to read. And remember, these all came from people who make a living selling cars. This is straight from the source, and well worth remembering.</p> <p><em>Are you a car salesman with more information to share? Let us know in comments below.</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-easy-diy-car-repairs-to-save-big">8 Easy DIY Car Repairs to Save Big</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-check-if-a-flight-is-delayed-online">How to check if a flight is delayed</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-smart-auto-finance-options">6 Smart Auto Finance Options</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/become-a-frequent-flyer-master-and-earn-a-free-flight-every-year">Become a Frequent Flyer Master and Earn a Free Flight Every Year</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Life Hacks Cars and Transportation buying a car car dealerships car salesmen marketing tricks Wed, 13 Mar 2013 11:36:34 +0000 Paul Michael 969713 at http://www.wisebread.com Cheat Sheet: Retail Markup on Common Items http://www.wisebread.com/cheat-sheet-retail-markup-on-common-items <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/cheat-sheet-retail-markup-on-common-items" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/3275702181_a11e8d65ae_z.jpg" alt="sale" title="sale" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>The holidays typically bring a rush of retail shopping. And during tough economic times, retail shopping brings endless commercials and high-decibel ads all proclaiming &ldquo;low prices&rdquo; and &ldquo;deep discounts.&rdquo; But how can we determine the value of a discount if we&rsquo;re unaware of the average retail markup? If those jeans are priced 200% above wholesale, does a 15% discount really seem that generous? (See also: <a href="http://www.wisebread.com/party-like-its-1999-the-psychology-of-pricing" title="Party Like It's 19.99: The Psychology of Pricing ">Party Like It's 19.99: The Psychology of Pricing</a>)</p> <p>Very few resources exist to research the average markup that retailers enjoy between their wholesale costs and retail prices. The whole topic seems shrouded in complex formulae and arcane insider knowledge. Even in the Information Age, online searches on the subject bring wild variances in statistics (when they exist) and huge gray areas of subjectivity (when they don&rsquo;t).</p> <p>With a few days worth of research, I&rsquo;ve narrowed down the range that most retailers employ when pricing their items. The list below outlines some of the more common consumer goods and the associated markup from wholesale to retail. One caveat: Consumers in America have a wide choice in retailers, and big box stores, outlets, malls, and boutiques all have their unique pricing structures based on overhead such as advertising, real estate prices, buying volume, staffing, etc. No single rule holds true for each, and broad ranges are the norm. However, from a consumer perspective, a broad range based upon research is better than no idea at all. A knowledgeable consumer is better equipped to understand the real value of a discount based upon a retailer&rsquo;s real cost and not the markup/markdown shell game that seems to entice us so often.</p> <h3>Clothing Markups: 100-350%</h3> <p>Jeans are the biggest culprit in the clothing category. The price of boutique denim jeans can reflect a markup of 350%. Jeans from mid-level retailers like Kohl&rsquo;s or JCPenney are slightly saner with an average markup of 115%.</p> <h3>Shoe Markups: 100-500%</h3> <p>Markup is as varied in the footwear industry as sizes and styles. Typical cross-trainers or athletic shoes carry a 100% mark-up, while higher-end fashion shoes at boutique stores can be marked up by as much as 500%.</p> <h3>Cell Phone Markups: 8-10%</h3> <p>The entire category of <a href="http://www.wisebread.com/frugal-advice-for-the-gadget-addicted" title="Frugal Advice for the Gadget Addicted">electronics</a> has some of the lowest markups around. Cell phones, for example, are only bumped up about 8% between wholesale and retail. The profit center for phones lies in the service contracts and usage fees. Manufacturers can operate with a lower retail markup because the real money is in the service.</p> <h3>Furniture Markups: 200-400%</h3> <p>No industry manipulates the meaningless MSRP (Manufacturer&rsquo;s Suggested Retail Price) quite like the furniture industry. Salespeople usually receive a 15-20% commission if they sell an item at the inflated MSRP. But there&rsquo;s another helpful abbreviation to know: MAP (Manufacturer&rsquo;s Advertised Price). This lower price is the minimum at which most retailers are allowed to sell the item. Salespeople resist consumers who ask for this price and only receive about 7% commission on MAP sales.</p> <h3>Grocery Markups: 5-25%</h3> <p>Grocers certainly operate on slimmer profit margins than most other retailers. According to the Retail Owners Institute, stores typically maintain a narrow margin of 5-8% on the staples and then broaden their margins on luxury or indulgence items (think high-end coffees, chocolate, wines, etc.).</p> <h3>Cosmetics Markups: 60-80%</h3> <p>According to the research firm Euromonitor, the average markup on premium cosmetics is 78%. Since most cosmetics are composed of various combinations of good ol&rsquo; dirt, oil, wax, and fragrance, this relatively small markup adds up to big profits.</p> <h3>Prescription Medicine Markups: 200-5,600%</h3> <p>According to an expose by the Detroit ABC affiliate WXYZ-TV, pharmaceutical companies enjoy a 200-5,600% markup on their drugs in the US. Canada and several European nations impose a ceiling on drug prices and actively negotiate with drug manufacturers to keep costs down. No such safeguards exist here; even generic drugs in the US can be marked up by as much as 1,200%. Sure, development costs are high for some of these life-saving medications, but the markup has no expiration date.</p> <h3>New Car Markups: 8-10%</h3> <p>Not factoring in extended warrantees, finance charges, and other add-ons, auto dealers markup car prices by about 10%. Dealers&rsquo; intricate pricing structures involve invoice prices, transportation charges, dealer holdbacks, and incentives &mdash; enough confusing consumer fodder to fill a dozen articles. Suffice to say, the more you know about the secret cabal of car dealerships and how they arrive at their sticker prices, the better chance you&rsquo;ll have of knowing where to begin your <a href="http://www.wisebread.com/the-7-laws-of-negotiation" title="The 7 Laws of Negotiation">negotiating</a>.</p> <h3>Eyeglasses Markups: 800-1,000%</h3> <p>It&rsquo;s amazing but true: Some opticians charge 1,000% over wholesale for the hottest designer frames. Malls and larger chain stores are the worst offenders, with many other peripheral costs factored into the price of those fancy frames.</p> <p>I'm not suggesting that retailers shouldn&rsquo;t be paid for the services they offer. Buying low and selling high is as American as apple pie and credit card debt. Retailers often have huge cost-structures to maintain &mdash; all supported by tweaking that markup and (hopefully) influencing consumer behavior by hitting the sweet spot between cost and perceived value. But since this whole system rides on the backs of you and me, isn&rsquo;t it worth unpacking, examining, and understanding exactly what we&rsquo;re paying for?</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kentin-waits">Kentin Waits</a> of <a href="http://www.wisebread.com/cheat-sheet-retail-markup-on-common-items">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-9-everyday-products-with-the-biggest-markups">The 9 Everyday Products With the Biggest Markups</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-brands-with-the-best-warranties">6 Brands With the Best Warranties</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-at-the-checkout">Debit Or Credit? Which One Should You Choose At The Checkout?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-retailers-with-the-absolute-best-customer-service">7 Retailers With the Absolute Best Customer Service</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Consumer Affairs Shopping car dealerships clothes shopping eyeglasses holiday shopping markups shopping tips Wed, 15 Dec 2010 15:00:07 +0000 Kentin Waits 388406 at http://www.wisebread.com Save on Your New Car: Send Mom, Not Dad, to the Dealer http://www.wisebread.com/save-on-your-new-car-send-mom-not-dad-to-the-dealer <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/save-on-your-new-car-send-mom-not-dad-to-the-dealer" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/3229989135_6cd9b922f0.jpg" alt="car dealership" title="car dealership" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>Some people just shouldn't go car shopping on their own &mdash; like Chris, who drove home to his horrified family in the garish chartreuse coupe on which he got &quot;a great deal.&quot; Chris should have never walked alone through the auto dealer's doors, not only because he is colorblind &mdash; but because he is a man.</p> <p>In generations past, buying the family car was considered Dad's job, but women now account for just over half of all automotive buys and play a big role when the family chooses a car. And that's a darn good thing for the household budget. Ahead of your next trip to the new car showroom or used car lot, you'll want to know what the automakers and dealers know about gender differences in car buying:</p> <ul> <li>Although on the whole more knowledgeable about cars &mdash; how they work, who makes what model, how <i>Road and Track</i> rated a new vehicle &mdash; men tend to be less rational about their purchases than are women.<br /> &nbsp;</li> <li>While men in a recent market research survey put &quot;styling&quot; on the top of the list of attributes they found most important in a car, women ranked it 11th. Women placed practical items like &quot;visibility from the driver's seat to both the front and rear&quot; high on their list.<br /> &nbsp;</li> <li>Men are more likely to carry into adulthood the unshakable desire to own their childhood &quot;dream car.&quot; Whether or not it is a practical or affordable purchase, they may well go ahead and snap it up. A man can overlook the difficulty of getting the kids in and out of rear car seats when he test-drives the gleaming model whose poster was on his bedroom wall as he grew up.<br /> &nbsp;</li> <li>Unlike women, who approach salespeople with a set of questions, men are more likely to display their knowledge at the dealership rather than test or build on what they think they know.<br /> &nbsp;</li> <li>Women are more focused on cost, using dealer incentives like rebates to reduce the overall amount they will pay while men generally use them to buy a more expensive car.<br /> &nbsp;</li> <li>Men fall out of love with vehicles at mach speed. Research shows that it takes only four months for the average man to grow bored with his car and become susceptible to advertising and sales pitches to buy a new one. Women bask in the pleasure of their new purchases more than three times longer (though still not terribly long).</li> </ul> <p>Knowing all of this, you may decide it's sensible to send Mom, not Dad, to the dealer next time. Of course, these are generalizations. There are men who buy cars pragmatically and women who buy them impulsively. (Unsurprisingly, it is an industry goal to turn women into more emotional purchasers.)</p> <p>Nevertheless, car shoppers of both genders would benefit from following a dispassionate process that involves these steps:</p> <ol> <li>Ask yourself whether you really <i>need</i> a new car or just <i>want</i> one. Owning your current car a year or two longer could save you thousands.<br /> &nbsp;</li> <li>Make a checklist of realistic, everyday needs before researching models that fit those criteria. Avoid buying for peak cargo, passenger, or terrain needs; instead plan on renting a vehicle for these occasions.<br /> &nbsp;</li> <li>Conduct research online and view vehicles at an auto show before entering the high-pressure setting of the showroom. Try to avoid the pitfall of using research to justify an emotional decision rather than to help make a reasoned one.<br /> &nbsp;</li> <li>Rely on trusted sources for comparative information that don't accept advertising from the car companies, such as <a href="http://www.consumerreports.org/cro/index.htm">Consumer Reports</a>.<br /> &nbsp;</li> <li>Bring your most frugal friend or family member with you to the dealer to help you stick to your needs checklist.<br /> &nbsp;</li> <li>Know how much a car will cost you to <i>own,</i> not just to <i>buy</i>. A car with a higher sticker price can cost you less to own over the first five years based on, among other things, its depreciation rate, repair costs, miles per gallon, and cost to insure. A good site for this data is <a href="http://www.edmunds.com/advice/buying/articles/59897/article.html">Edmunds True Cost to Own</a>&trade;.<br /> &nbsp;</li> <li>If you cannot save up before buying, secure financing before going to the dealer. Understand how much you need in total (roughly two times the monthly loan payment) to own your car. Dealers know how easily payment shoppers can be convinced to buy more car once in the showroom.</li> </ol> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p>This is a guest post by Catherine Lutz and Anne Lutz Fernandez. Catherine is an anthropologist at Brown University&rsquo;s Watson Institute, and Anne is a former marketer and banker. They are the authors of <i><a href="http://www.carjacked.org/">Carjacked: The Culture of the Automobile and its Effect on Our Lives</a> </i>(Palgrave Macmillan). Read more by Catherine and Anne:</p> <ul> <li><a href="http://www.brownalumnimagazine.com/content/view/2427/40/">Car Wreck</a></li> <li><a href="http://ac360.blogs.cnn.com/2010/01/29/cash-for-clunkers-the-gift-that-keeps-on-taking/">Cash for Clunkers: The gift that keeps on taking</a></li> <li><a href="http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2009/05/06/car_crash_the_death_of_the_american_auto/">Car crash: The death of the America auto</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/catherine-lutz-and-anne-lutz-fernandez">Catherine Lutz and Anne Lutz Fernandez</a> of <a href="http://www.wisebread.com/save-on-your-new-car-send-mom-not-dad-to-the-dealer">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/car-buying-part-2-into-the-devils-domain">Car Buying Part 2 – Into the Devil&#039;s domain.</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know">17 Things Car Salesmen Don&#039;t Want You to Know</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cheat-sheet-retail-markup-on-common-items">Cheat Sheet: Retail Markup on Common Items</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-jump-starter-kits">The 5 Best Jump Starter Kits</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Shopping auto budget car dealerships car shopping mom and dad Fri, 06 Aug 2010 12:00:07 +0000 Catherine Lutz and Anne Lutz Fernandez 196264 at http://www.wisebread.com Car Buying Part 2 – Into the Devil's domain. http://www.wisebread.com/car-buying-part-2-into-the-devils-domain <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/car-buying-part-2-into-the-devils-domain" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000035853430_XXXLarge.jpg" alt="untrustworthy car salesman" title="untrustworthy car salesman" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Last time I covered the basics of <a href="http://www.wisebread.com/car-buying-part-1-going-for-broker">going with a broker</a>. I hope many of you found that advice useful. Now, I&rsquo;m going to cover a few basics of buying a new or used car from a car dealership. (I&rsquo;m not into leasing because, well, I&rsquo;ve never leased. It&rsquo;s just never been the right option for me, so I couldn&rsquo;t offer you great advice on something I&rsquo;ve never done myself.)</p> <p class="MsoNormal">Now I must point out that I really only am covering basics here. I could write a book about buying a car from a dealership, and many qualified professionals have already done so. That&rsquo;s why I&rsquo;d choose a broker over a dealership haggle. But, I didn&rsquo;t have the broker option last time for one simple reason: My car died on me and I needed a new one ASAP. That&rsquo;s when a broker falls down on doing it yourself. You can&rsquo;t play the waiting game if you have no car to drive. So, once more into the Devil's domain I ventured. And here&rsquo;s what advice I have to offer on that subject, in 10 simple steps.</p> <h2>1. Research, Research, Research</h2> <p class="MsoNormal">I was lucky. When my old car kicked the bucket, I had already done my research. I knew I wanted a 2007 Civic Coupe, I knew the specs I wanted, and knew the price I was going to pay. I was armed. I recommend you do the same. Do yourself a favor and go into a dealership with the car you have in mind bolted deeply in your head.</p> <p class="MsoNormal">There are many ways to research a car. Use <a href="/www.kbb.com">Kelley Blue Book</a>&nbsp;and <a href="/www.edmunds.com">Edmunds.com</a>. They are worth their weight in gold. Is an LX better than a DX, or is the extra cost not worth it? Do you need good fuel economy, or rear, front, or all wheel drive? What exactly do you need? Spend weeks on this, really. There is no such thing as a good impulse buy when it comes to a car.</p> <h2>2. What Can You Afford?</h2> <p class="MsoNormal">When you find the car you want, find out its TMV, also known as <em>true market value</em>. You can find more about that at Edmunds.com</p> <p class="MsoNormal">This is basically what people are paying for that car across the country, taking into account dealer incentives, seasonality, and so on. This is a great place to start. On no account do you want to pay MORE than the TMV. Ideally, you&rsquo;re going to use this as a figure to drive the price down. I managed to get my car for well under the TMV, and that price was way, way under the sticker price on the car. What is sticker price? Well, that&rsquo;s the pie-in-the-sky amount you see on the window that the dealer is hoping you&rsquo;ll pay. And you will, if you&rsquo;re known as a &ldquo;laydown.&rdquo; A good car salesman knows a laydown after just a few minutes (or sometimes less). A laydown will basically say all the wrong things, come armed with no research, reveal how much they want to pay immediately, reveal their trade-in, and so on. DON&rsquo;T be a laydown. So, bearing all that in mind, you now know what you want, and what you are willing to pay. Next, the trade-in.</p> <h2>3. Trading In Your Old Car</h2> <p class="MsoNormal">So, most of you will have a trade-in. If you can, make sure this is paid off. You see those ads saying &ldquo;I&rsquo;ll pay off your trade no matter what you owe?&rdquo; Of course he will. You can owe $28,000 on a car worth $35,000. He doesn&rsquo;t care. All the dealer wants is your name on the dotted line. So, he&rsquo;ll take in your car, pay off your trade, and apply that huge figure to the balance of your new car. Guess what. Now that nice little car you had your eye on just doubled in price. Ouch.</p> <p class="MsoNormal">Even if you only owe a few thousand, get it paid off. It puts you in a much better place at the negotiating table. Now, you also need to get the fair value of this car. Kelley Blue Book is a great resource. They have a tool for estimating the fair trade-in value of your car. And by fair, that means be honest. When you fill out the form, don&rsquo;t say your car is in &quot;excellent&quot; condition if it has a few dings and needs a new transmission. The dealer&rsquo;s no fool. Get the real trade-in value, and write that down. Take NO LESS than that. And above all, never mention your trade-in until you&rsquo;ve done the deal on the new car. Mentioning this first puts you in a position of weakness.</p> <h2>4. Financing Ahead of Time</h2> <p class="MsoNormal">If you can, get yourself pre-approved for a blank check auto loan. This gives you so much power at the closing table, I can&rsquo;t tell you how cool this is. You&rsquo;re not at the mercy of dealer offers, and best of all, you know exactly how much you&rsquo;re approved for. Most financial institutions will do it, I used a credit union. They have excellent rates and you already know them if you use a bank you&rsquo;re familiar with. Also, know what your credit score is. That lets you know what kind of APR you&rsquo;re going to get if you do decide to go with a financing offer from the dealer. I&rsquo;ve never paid more than 6.5% APR. Last time, it was 5.75%.</p> <p class="MsoNormal">So, you&rsquo;ve done the research, got the cash, know what you want, and what you&rsquo;re willing to pay. You even know the price of your trade, down to the last cent. You&rsquo;re ready. (I&rsquo;d say at this point, wait until the ideal time to buy a car &mdash; ideally, just before delivery of the new year's cars. But, as most of us can&rsquo;t wait for one specific month in the year, let&rsquo;s move on.)</p> <h2>5.&nbsp;The Dealership, the Sales Staff, the Horror</h2> <p class="MsoNormal">I hate dealerships. I really do. It&rsquo;s all a complete façade. You want to walk away with a car for peanuts, the dealer wants you to go bankrupt on a compact car with a rubberband engine. But, this is where you can knuckle down and get the deal.</p> <p class="MsoNormal">First, walk into the dealership armed with your folder, filled with research and cold, hard facts and figures. That tells them straight-away that you are no laydown. Bingo. Stage one complete. Now, choose your vehicle. You know it. You&rsquo;ve seen it before. Hopefully, you&rsquo;ve even test-driven it a couple of times on previous occasions and walked away (good for you&hellip;this has the dealership dangling on a hook for your business). Now, you&rsquo;re ready to say those immortal words &ldquo;I think I&rsquo;d like to buy this car.&rdquo; At this point, you&rsquo;ll get escorted to the &quot;table&quot; and this is where battle commences. You&rsquo;re going to hear things like &quot;What can you afford as a monthly payment?&rdquo; or &ldquo;Well, your trade-in isn&rsquo;t quite up to scratch.&rdquo; Here, I present you with the golden rule&hellip;</p> <h2>6. If In Doubt, Walk Out</h2> <p class="MsoNormal">Seriously, this is a dealership&rsquo;s Achilles heel. The second you mention that you&rsquo;d like to think about it, and stand up, they freak. You&rsquo;re almost a sale. You&rsquo;re almost a big, fat, juicy commission check. There&rsquo;s no way you&rsquo;re leaving. And this is when the tables turn back to your favor.</p> <p class="MsoNormal">Be firm. Before they throw a whole bunch of mumbo jumbo handling fees and so forth at you, ask to see the INVOICE price of the new car. That&rsquo;s the price they paid for the car, and by law they have to show it to you. Check as well. Make sure they&rsquo;re not showing you an invoice for a souped-up version of the car you&rsquo;re buying. If you&rsquo;re buying a used car, you should already have the figure from your research at Kelley Blue Book. Either way, once you have that figure you know you&rsquo;re not going to pay much more. Remember, don&rsquo;t talk about a trade-in. Wait until you&rsquo;ve agreed on a price, not based on a monthly payment but on a final, everything included, sale price. When that&rsquo;s good and you feel good, then mention your trade. And you don&rsquo;t say yes until you get what you want. You&rsquo;re being reasonable, because the price you want is a good $2,000<span style="font-family: Arial; font-size: 14.6667px; font-style: normal; white-space: pre-wrap; color: rgb(0, 0, 0); line-height: 1.5; background-color: transparent;">&ndash;</span><span style="font-size: 13px; line-height: 1.7em;">$3,000 less than what the dealer will sell it for. That&rsquo;s a nice profit. Add that to the small profit they&rsquo;ll make from the car they sell you, and they&rsquo;ve done quite nice for a few hours work.</span></p> <h2>7. The Salesperson Is Not Your Friend</h2> <p class="MsoNormal"><span> </span>A few times, I&rsquo;ve had scenarios where a salesman has gone back and forth between myself and his boss, struggling on my behalf to get my payment down by a few thousand dollars. It&rsquo;s bunk. Total bunk. He&rsquo;s probably going in there to talk about the weather, or last night&rsquo;s ball game, or what a sucker he has for a client right now. If you get the sense that you&rsquo;re being taken for a fool, refer to the step aboe. There is more wooden acting going on here than in a bad soap opera.</p> <h2>8: Deal&rsquo;s Done: Off to Financing Hell</h2> <p class="MsoNormal">Yikes. Another table. Another set of papers. And yet more ways to get screwed. Only this time, you&rsquo;re dealing with a person who is a phenomenal bean-counter. It&rsquo;s the job of this person to add everything possible on to the sale of the car. Extra warranties, GAP insurance, clear bras, tinting, rust-proofing, alien-avoidance-radar, you name it, they&rsquo;ve got something to sell.</p> <p class="MsoNormal">In my opinion, take nothing. All of these you can find yourself from great institutions at much less than what the dealer will charge. They mark these up by an enormous amount. You know what you want to pay, and with the unavoidable addition of dealer handling fees and sales tax, that&rsquo;s all you will pay. If you have a blank check, sign it and hand it over. If not, you know your credit score so you know what kind of APR is coming to you. Feel good? Sign the papers. Don&rsquo;t feel so good? See above and walk away. You can come back another day, after you&rsquo;ve had time to think it over. Until you sign, you are liable for nothing.</p> <h2>9. Check Your Vehicle</h2> <p class="MsoNormal">Whether new or used, give your car a thorough going over before you leave the dealership. It&rsquo;s amazing what shows up in daylight, after the car has been detailed. If you&rsquo;re not happy with anything, make it known. The dealership will have to take care of it. Remember, this is a big purchase. Most likely the second largest after your home. So, just like a walkthrough before you move in, give your car that final once-over. Now, you&rsquo;re ready to drive off home. It&rsquo;s been a few hours, you&rsquo;re a little older and a little greyer on top, but you did great. Now you can see why choosing a broker is preferable.</p> <h2>10. Relax</h2> <p class="MsoNormal">Go home, put your feet up, grab a cocktail or a nice fat cup of tea and pat yourself on the back. You have walked into the Devil&rsquo;s domain and came out smelling of roses. Most people don&rsquo;t. I know it took a long time to cover this, but it was worth it. And as I always say, IF IN DOUBT, WALK OUT.<strong> </strong>That&rsquo;s your biggest bargaining chip. Happy motoring, folks.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/car-buying-part-2-into-the-devils-domain">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-car-parts-that-are-safe-to-buy-used">9 Car Parts That Are Safe to Buy Used</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/save-on-your-new-car-send-mom-not-dad-to-the-dealer">Save on Your New Car: Send Mom, Not Dad, to the Dealer</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-millennials-can-learn-about-saving-money-from-gen-x">5 Things Millennials Can Learn About Saving Money From Gen-X</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-saving-hacks-every-college-student-should-try">8 Money-Saving Hacks Every College Student Should Try</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation Shopping Buying a new car car dealerships car deals saving money Sun, 21 Jan 2007 17:03:24 +0000 Paul Michael 206 at http://www.wisebread.com