Automotive

Insider Secrets to Negotiating Your Car Purchase Like a Pro

A car purchase begins with sticker price information but does not end there. Skilled shoppers understand they can find massive discount opportunities through correct timing combined with particular methods. In this comprehensive guide, we reveal real, battle-tested strategies that will allow you to negotiate the price down to the bare minimum.

Do Your Homework Before Walking into a Dealership

Your ultimate weapon is knowledge. Before visiting a dealership check out Kelley Blue Book or Edmunds to gain access to invoice prices and make informed decisions about your vehicle choice. Compare Invoice prices to MSRP. Consumer Reports reveals that dealers set prices 8% to 12% higher than invoice cost but not all consumers understand this bandwidth for negotiating discounts. 

For instance, at an MSRP of $30,000 the invoice amount typically settles around $27,000. Through determined negotiations you can potentially lower the car price to reach $26,000 which results in a $4,000 savings. That’s not hype; these are based on real numbers that smart shoppers achieve.

Get Multiple Quotes and Capitalize on Competition

Never take the first price quote you receive. Call a number of dealerships and request price quotes for the same model and trim. By comparing prices, you can use a lower price as bargaining leverage with another dealer. Always let them know that you’re shopping around. This competitive tactic forces dealers to offer you the best price initially.

Negotiate the Total Price, Not Just the Monthly Payment

To concentrate on monthly payments only is misleading. Sellers will often manipulate financing conditions to achieve a prettier deal without paying an extra premium for the price. Bargain from the vehicle’s full price rather. Ask for an itemized breakdown of charges — acquisition charges, dealer doc fees, and add-ons — and scrutinize any that seem excessive. Clarity in the bottom line is important to avoid unpleasant surprises later.

Keep Your Trade-In Separate from the New Purchase

If you do have a trade-in, negotiate it separately. The dealerships will bundle the two negotiations together to conceal the true discount you’re receiving on the new car. Negotiate the new car’s price first. Once that’s done, then work out your trade-in’s value. This is making two separate deals so you receive the best price on both rather than making one for the other.

Pre-Approve Financing to Assist Your Negotiate

Having pre-approval for financing up front in your wallet will significantly boost your negotiating power. Banks and credit unions typically offer competitive rates that are lower than what many dealerships actually do provide. Arranging with a pre-approved loan has the dealer in catch-up mode from your original quotation. It also makes the process easier and discourages them from inserting unnecessary markups.

Be Prepared to Walk Away

One of the strongest negotiation tactics is being willing to walk away. If the dealer won’t make your offer after negotiating back and forth, walking out is an excellent sign. Dealers often call back with a better price rather than losing a sale. Being assertive and willing to walk out shows you know the market price and do not require having a deal.

Be Mindful of Hidden Charges

Although the negotiated price may seem appealing, always review the final agreement carefully for hidden charges. Some typical extra charges are:

1. Acquisition Fees: Charges levied by the leasing company or bank.

2. Documentation Fees: Administrative charges that can sometimes be negotiated lower.

3. Government Fees: Registration, title, and other taxes that may be rolled into the monthly payment.

By asking for an itemized bill and asking if there is any fee that seems unreasonable, you can avoid surprises when it’s time to sign on the line.