How To Buy A New Car Without Getting Ripped Off
Follow the 5 “Do’s” to Getting the Deal You Want
Have you heard of buyer's remorse?
This is when you finally make a major purchase only to regret your decision.
That happens a lot with homes and cars.
Usually it is rooted in a feeling of having spent too much money on the thing.
You can avoid that when it comes to buying a car if you follow these handy-dandy tips.
Do Your Homework
Across the Internet, there are pages and pages of information available about the type of car you're interested in buying.
Do your homework and figure out exactly the make, model and perks you're looking for.
There will always be room for adjustments, but if you can arm yourself with the pertinent information then you'll be in a much stronger bargaining position.
Plus, you won't get suckered into any add-ons that you don't need or don't want.
Stick to your plan. If there is one thing that car salespeople hate it is an informed buyer. Show up with your print outs and you'll be unstoppable.
Do Your Own Financing
Car dealerships don't make money-selling cars…
They make money financing car loans.
For instance, when the dealer sets up your finance, they are given the lowest rate that you qualify for. This is the "buy rate."
However, you might never know the buy rate because the dealer wants to pad those numbers in order to make money.
The rate they offer you would be the "yield spread premium."
Yeah, avoid that.
If you're going through a dealer, tell them you want the buy rate.
On the other hand, you can avoid all of this haggling if you set up your financing outside of the dealership.
Your bank offers auto loans so check them out and get pre-approved. That way you have a "fallback" rate to, well, fall back on if the dealer tries to rip you off.
Do Walk Away
The greatest power you have in a potential car deal is to walk away.
You know how long it takes to run your credit report? About as long as it took to read the previous sentence.
Everything is just a show. Car dealers want to keep you in the showroom so that you become emotionally invested in the car you're buying.
The longer you stay, the more you want a deal to happen. It can all happen in under an hour or walk away.
What's the worst that can happen? You go buy the car somewhere else?
If the dealer puts on the stall, tell them you're out in 15 minutes and mean it. Watch how fast they hop to.
Do Get It In Writing
A dealer might offer you a return policy.
They might offer you a one-year warranty.
They might offer you free doughnuts for life.
Whatever they are offering, DO get it in writing. There is no such thing as handshake deal when it comes to buying a car.
What car do you have you eye on?
Let us know!