How To Deal With the Dealer - Ten Do's and Don'ts for Car Buyers

December 15, 2009

So you have decided to single handedly save Detroit, not to mention, Nagasaki, Seoul, Stuttgart, and Milan by purchasing a new car. Before you put yourself and your dealership through hell again, here are ten things to keep in mind.

This is for your sake and theirs. After all, they are just trying to keep the doors open by opening a few for you.

1.      Do your homework. Now before you make a face, I am talking about fun homework. Figure out what you want and need in your next vehicle, and research it until you either know which model you want, or at least have it narrowed down to a few.

2.      Do make an appointment. This sets you apart from 90% of the public who just drop in. It marks you as a courteous and serious customer. You want to be taken seriously, especially if you are going to be purchasing. Let them know you are not just looking, and you have a limited time allotted say no more than an hour total for example.

3.      Do get pre-approved before you show up by your credit union, bank, or an online auto finance broker. Do I really have to tell you how credible you now look to the dealer, or how much stress this will eliminate?

4.      Do bring the written pre-approval with you. Let them see it, so they do not waste your time trying to pre-qualify you. Let them know they can still do your financing if they are competitive.

5.      Do not say you are paying cash if you can avoid it. At best they will take it to mean you cannot qualify, or just don't want to have your credit pulled. At worst they will believe you which means they just lost the most profitable part of the transaction. Not a good negotiating strategy.

6.      Do spend a few dollars and get the actual dealer cost, not just invoice, on the model you want. Find out about all incentives if possible. You cant negotiate well without this information.Consumer Reports among others offers this service for a fee.

7.      Do not try to get the dealer to sell you a car at a true loss. Unless it is a model that nobody wants, and they are dying to get rid of it. If it is popular or scarce, you may be lucky to get them to sell without a large markup.

8.      Do allow a reasonable profit over cost - which is actually below invoice on many   cars.  Negotiate up from their cost, not down from their sticker or invoice.

9.      Do not lie to the salesperson. They can tell.  Courtesy and honesty are rare, so know what your bottom line is, and let them know firmly but politely. Be prepared to walk, but leave the door open.  If the car is not for you, say so.

10.  Know what inventory is out there. Is the car you want at several places, or is this the only black Challenger SRT-8 in a 500 mile radius? It makes a difference if you know you can go somewhere else. Of course you can buy something out of state, or have the dealer order you something. If you are patient and don't mind paying extra, which kind of kills the point.

11.  Oops, I said ten didn't I? This is a valuable extra do and don't you should have with every article, as you can roll it in for just a few extra words per paragraph.  Sound familiar? I thought so. When you close on that great deal, do not, I repeat do not, undo all your research and negotiating by buying overpriced extras from the dealer. This includes everything from extended warranties, to rust proofing and undercoating scams, to pre-treating fabrics, to a gap insurance add-on that was already figured into the financing.

Do have fun shopping for your car, and don't spend extra time, money, or emotional stress you can avoid by following this list. Or forget what I said and just wander around aimlessly until someone sells you a car you didn't mean to buy at a price you never meant to pay. Don't say I didn't warn you.
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