Car shopping makes many a person uncomfortable. Buying a used car can be especially challenging. You worry about getting a total piece of junk. Used car salesmen do not exactly have the best reputation among all the business people out there. Negotiating with people trained in the art of the sale can seem intimidating. But, armed with a little knowledge about the negotiation process, you can go into the situation a bit more confident, helping you land a better price. Here are some tips for negotiating with used car dealers.
Knowledge is Power
Knowledge is power, and the used car negotiation process is no exception. The dealer gets a whole lot of information from you right off the bat—the amount of money you want to spend on a car, what type of car you want and the type of vehicle you are trading in. This obviously works to his advantage in selling you a car at the maximum profit. And don’t forget that most car buyers are grossly uninformed about the vehicles they are looking for and their true value, so they are losing some power because they do not have all the information they need.
So, your first step in the negotiating game is limiting the information you tell the dealer. Secondly, learn everything you can about the cars you are interested in buying. If you have no idea what the true value is, there is no way you can negotiate from a powerful position. The goal is to find a fair price between what the dealer paid for the car and the retail value. Check guides like NADA and Kelley Blue Book, but know that the wholesale values (what dealers should be paying for them) is not available in the online guides. This is an important number to know. But, you must also do some research about your local market to get the most accurate idea of a car’s true value. Some cars may be more or less popular in your area, which affects the true retail value.
Go to sales lots after hours to browse the inventory without pressure. Take note of cars you like and go home and start researching.
Don’t Forget about All the Ways Dealers Make Money
Dealers can make money off you in three ways—the money made on the sale of the car, financing and the profit they make on your trade-in. These last two ways may not be applicable to every used car buyer, but if it applies to you, do not forget about items two and three. Do not forget about financing and the trade-in when deciding on what you think is a fair price for the car. In some cases, he may be making more money off these elements than the profit made from selling the car to you for more than what it is worth.
Stand Your Ground
Keep firm on your offer (provided it is reasonable.)Do not let the salesperson steer you off in another direction. For example, he may try to shift the focus to monthly payments rather than the overall price of the car. But, it is important to finalize pricing on the vehicle first and foremost, then talk financing. If you are not getting what you want, it is important to walk away, no matter how much you want that car. This shows you are serious about getting what you want.