Ask The Seller To Sweeten The Deal
The best negotiations are win-win deals. The buyer wins, the seller wins . . . everybody wins! Theres a healthy give-and-take involved, and sometimes that goes beyond the price tag. If a seller doesnt want to budge on price, you can get a little creative and ask the seller to throw in something extra so youll agree to pay them what they want.
If you and the seller take the car to a mechanic who finds a problem with the carmaybe it needs new brake pads or the tires are worn downthats something you can use to either negotiate a lower price or sweeten the deal.
You can say, If Im going to give you $10,000 for the car, then I want you to throw in brand-new tires. It doesnt hurt to ask!
Before Buying A New Car: What You Need To Prepare
It helps if youre clear beforehand on exactly which model, engine and trim level youre interested in, so check out all of our new car reviews and pinpoint the model and spec that’s right for you.
Theres more you can do to secure a great deal before you even set foot in the showroom.
Look for manufacturer discounts online and in adverts, and be prepared to bargain dealers still have their own margin to play with.
Look for manufacturer discounts online and in adverts, and be prepared to bargain dealers still have their own margin to play with.
Check car broker prices theyre easy to obtain online. Even if you dont want to buy from a broker, just mentioning the prices they offer will often change attitudes in the showroom. Take printed quotes with you to show the salesperson.
Never Agree To An Early Credit Check
If you plan on financing a car, you’ll eventually have to submit to a credit check. According to Car and Driver, however, some dealers will try to get you to consent to a credit check early in the process, perhaps because they have to “screen” potential buyers. Not only does this not benefit you in any way, but so-called hard pulls can actually damage your credit.
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Come Prepared With Paperwork
If you cant figure out how to negotiate a used car price or new car price do your homework. If youve done your research and know what a fair price for a car is, or know another dealership is offering a different deal, share that information. Come prepared with price reports or comparison sheets. These can be found on websites like Edmunds and Kelley Blue Book.
How Much Is A Used Car
When negotiating prices on used cars, it’s helpful to know how much they typically sell for. On average, the typical used vehicle sold for $21,558 in 2020. Prices for used vehicles and new cars rose during 2020 thanks in part to a wave of consumer spending triggered by the release of economic impact payments. Decreased supply of used vehicles paired with more consumers having ready cash to spend in the form of stimulus checks helped raise used car prices year over year.
In terms of how much should you pay for a used car, that depends entirely on your budget. If you’re paying cash for a used vehicle, then the amount you have on hand will likely determine how much you can spend. If you’re planning to get an auto loan, then you may have a larger used car buying budget to work with. Remember to check the best car loan rates to compare financing options.
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Do A Background Check
If youre buying a used car, be sure to run a background check on it. Companies like HPI, the AA and the RAC will make sure theres no outstanding finance on a car and it hasnt been stolen or written off. All they need to do this is a number plate. While many dealers will provide background checks on the cars they sell for you, a quick phone call to the checking company to confirm the details provided is always a good idea. If any problems do show up, walk away from the deal politely, but immediately.
How Much Can I Haggle Isn’t The Price On The Car The Actual Price
No, it’s not. Purchasing a new vehicle is not just a big expense, but an investment, and it is definitely a negotiable endeavor.
Certain purchases are non-negotiable. Like when you walk into Walmart, you cant walk up to the guy and say, “Hey, I know that TV has a $2,000 price tag, but I’ll give you $1,500 for it.” They will simply say No. and let you walk. Same thing at the supermarket, and so on. They know someone will be along in the next minute paying the posted price.
But when you’re spending tens of thousands of dollars on something, you better believe you should be negotiating, and they do not want to let you walk.
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Can You Negotiate Buying A Tesla
The Tesla buying process is more streamlined and efficient than most dealerships, but it comes at the price of not being able to negotiate Tesla prices. All prices on the companys website for their cars are final. However, this isnt a bad thing. Due to not needing a middleman to sell your vehicle to you, Tesla is able to keep its prices low and sell directly to the consumer while still maintaining high-quality craftsmanship.
Teslas cannot be negotiated through their traditional buying method. However, some dealerships sell used Teslas where you can haggle the price of the interest on the loan. Keep in mind that buying through these dealerships is more than likely going to be more expensive and time-consuming than purchasing directly from Tesla. Although you will be able to negotiate the price of the interest on the loan, ask yourself if its really worth it to go through this process rather than purchasing a Tesla directly.
So Heres How You Cut The Deal
You just got back from the test drive. It was incredible. You could feel the engine rumbling in your belly. Just the fragrance of the barely-worn leather upholstery intoxicates you with anticipation.
The salesman looks at you. “So what do you think?” You say, “It drives nice. I like this little feature, and this little feature, but I saw the sticker price. We’re not really at my number yet.” This is when the “what-if’s” start. The dealer looks at you. “Well, what if I can take $1,500 off that price? Would that help?””That’s a start. I brought some notes, let’s take a look at some figures.”
Their first offer is just that. Their second offer is just that. It’s the third offer, the fourth offer, and the stop-you-from-walking-out-the-door offer that you’re trying to get to.
Use options to your advantage. They will try and get closer to your number by offering you less of a vehicle in some way, and unless your number is ridiculous, this is not an acceptable solution. Youll say,”Well, I like this number were at, but this model doesn’t have this and that, and your offer on my trade is a little low.” Get what you want for your trade, but don’t be unreasonable. Since youve researched all three Kelly Blue Book values for your trade, you have a good idea what its worth.
Then he’ll start throwing the what-if’s out there again. What if I can throw in the DVD player, and the fancy tires, what if I give you X amount more for your trade. Would we have a deal then?
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Set A Target Value For Your Trade
The other bullet in your money gun is your current car. If youve got a vehicle that youre getting rid of, you have a number of alternatives to consider. The first step would be to determine what your vehicle is worth. You can obtain an estimate via online valuation sites according to your location, the vehicles general condition and the number of miles on the odometer.
You can obtain a more accurate assessment by checking its Carfax History-Based Value . These free estimates are specific to a models vehicle identification number and are based on a wider set of variables than most websites use when looking up a VIN. Carfax History-Based Value includes the number of owners, vehicle use , open recalls, service records, accident history and registration history.
You can usually get the most money by selling the car yourself, but thats a time-consuming process. Though youll be offered far less for it, a far easier way is to trade it in when you buy a new vehicle and use the proceeds as all or part of your down payment.
Another alternative is to offer it directly to the used-car department of a new-car dealership, particularly one that sells the same brand of vehicle as the one youre getting rid of. At the least, you can use a bona fide offer from a new or used car dealer as a negotiating tool later, should you decide to trade the car in as part of the new-vehicle transaction.
Become The Pricing Expert In Your Area
The market is always changing, and prices fluctuate rapidly. So it’s important to shop around for the best deal. The car pricing terms here will guide you as you get quotes and consider various offers. As you shop, you will become an expert on car pricing in your area during the period of time you’re shopping for your car. And when you know the numbers behind the deal, it will make you a better negotiator.
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Secure Your Own Financing
Yes, you can get financing at the dealership when you buy the vehicle, but securing your own auto financing ahead of time can help in a few ways:
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Youll know what amount you’re pre approved for, allowing you to shop without wondering if you’ll be approved.
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You can shop like a cash buyer, negotiating the selling price instead of the monthly payments .
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It gives the dealer a best offer to beat. If you already have a great offer from a bank, credit union or online lender, the dealership has to beat that offer to earn any bonus or commission on the financing. This limits the dealerships’ ability to hold points the act of adding percentage points to the rate the banks offer and pocketing the difference as commission so you get a stronger interest rate and save money throughout the loan.
Other Tips And Tricks For Negotiating
In addition to the steps listed above in the guide for entering car shopping negotiations, below are a few other tips on how to negotiate car price:
- Check different dealerships for the best price
- Know the deals and discounts before beginning negotiations
- Mention the price of the car at a competing dealership and ask if the dealership youre at can beat or match its competitors price
- Keep your initial offer reasonably low so that youre still likely getting a deal if the purchase price is higher
- Know the out-the-door price before signing any contracts
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Realize Each Used Car Is Unique And Investigate Its Past
Each car will have a unique history, current condition and number of miles on the odometer.
For this reason, its important to thoroughly investigate any used car you may buy. Get a vehicle history report using a service like Carfax to see how many previous owners the car has had, whether its been in any accidents, and what maintenance or other work has been done on the car. These factors are important in both choosing a used car and negotiating its price.
Research All Available Offers
Once you have identified the car you would like that fits your budget, it’s time to do some research. Preparation and research is the single best thing you can do in a negotiation and it is no different when car buying.
First you’ll want to get an idea on the price of the car given the make, model, year, options, mileage, etc. You can use resources like Kelley Blue Book or Edmunds to get a fair market value of the vehicle in question.
To zero-in closer on the market value, you’ll also want to get an idea of pricing of the actual vehicle in question by referencing dealership websites and Autotrader to get an understanding of what the vehicle is actually listed for at the desired specifications.
If you want to get even more detailed, you can document in an Excel sheet or Google sheet all of the inventory of vehicles that fit your criteria, the pricing, mileage, options, etc. so that you can get a high & low estimate as well as find the median estimate of the vehicle in order to land on a fair price.
Once you have an understanding of the available inventory, it is time to e-mail the salesperson and start the negotiation process.
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Don’t Negotiate Based On Monthly Payments
Another common tactic is for a dealer to ask how much you want to spend per month. Never fall into this trap. Once a dealer knows your budget, they can sell you almost any car they want. By stretching out the loan terms, they can shoehorn a much more expensive car into your monthly budget. The problem is, you get stuck not only with a more expensive car, but you wind up paying far more money in interest payments — if they’re doing the financing, they win twice. According to AutoTrader, $400 a month for 60 months is enough for a $24,000 car. For 72 months , it’s $28,800, and for 84 months , you can get a $33,600 car for the same $400 monthly payment. Determine what you can afford based on a 60-month payment plan and make that your budget.
Advantages Of Buying A Car Online
As we outline in How to Shop for a Car Online, using the magic of the internet for your car, truck, van, or SUV purchase has multiple advantages.
Hundreds of information sources, including the JDPower.com website, are available to help you hone your vehicle selection. Beyond that, resources like this one are at your fingertips to help you decide what you should pay, whether the vehicle you are looking at is a brand-new or a used car. Since knowledge is power when you’re negotiating a vehicle’s price, having these free resources puts you in the figurative driver’s seat.
Also, other aspects of the online buying process are firmly in your favor when you negotiate. Here are some of the critical advantages to negotiating a car price online:
- No sales pressure
- No face-to-face interaction
- Opportunity to shop several deals simultaneously
These factors offer you incredible advantages as a negotiator compared to walking into a dealership, meeting a salesperson at the door, and wending your way through the traditional sales process. By approaching the negotiation online, you immediately separate yourself from the run-of-the-mill shopper. You also position yourself as a smart, no-nonsense buyer who wants a good deal done quickly.
Believe it or not, dealers like that kind of customer.
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Can I Negotiate The Price With A Used Car Dealer
| The answer, in short, is yes. What you need to be aware of, though, is that unlike new cars, used cars dont provide the dealer with below the line, off the sticker discounts and incentives based on reaching sales goals. When buying a used car its a simple equation of what it cost the dealer to acquire the vehicle, what costs were incurred in making the vehicle fit for sale, and how much the dealer needs to make to keep the lights on and the doors open. Then the dealer adds a buffer to that amount, checking the various pricing tools available so that they have some wiggle room if they have to negotiate. |
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Don’t Reveal How You Plan To Pay
A dealer is likely to ask if you plan to finance the vehicle through the dealership. Say you haven’t decided and you’ll discuss financing after you come to an agreement on the price of the car. If the dealer knows you’ve secured a preapproval, the salesperson might go higher on the price of the car to make up for the fact that they won’t be making money on financing. If they know you plan to finance through them, they might go lower on the vehicle price because they know they can juice the loan rate.
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Understand The Power Of Cash
The best way to buy a car is with cash. But does cash really have the same power that it used to? In a society where most folks buy things with the swipe of a card, its a fair question. But in an increasingly cashless society, cash is probably even more powerful as a negotiating tool than ever!
Nothing is more stressful than selling a big-ticket item worth thousands of dollars and wondering if the persons check is going to bounce or if their loan approval will come through. With cash, you take away that stress completelythat makes your cash offer a lot more attractive!
People get silly when they see cashreal cash. Its emotional. Its visual. It sends a message that you mean business. So, dont be afraid to literally put the money on the table and say, Look, if you want this money today, youre going to have to meet me at this price. If not, Im outta here. Even in a world with PayPal, Venmo and Apple Pay, its still all about the Benjamins!
