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6 Common Mistakes People Make At The Car Dealership

By: Hank Peterson

You may think that buying a car from a dealership is a hugely intimidating thing, , and you might be anxious about the process. It’s really not that big of a deal, though, as long as you are aware of some mistakes you should avoid. Read on and gain some confidence for your next interaction at the car dealership.

Not knowing what you want.

Never go looking for a new car without knowing exactly what you want before you walk out of your house. People who go shopping without having a solid idea of what they need and want are great for sales people who can see them coming from a mile away. Go online first and see what there is available, compare features and prices, and read reviews from both experts and people who own or have owned the car you’re researching. Estimate financing costs, too, as well as how much your insurance will cost. This will give you a good base before you even step foot onto a car lot.

Negotiating based on MSRP.

There are only a few dealerships that won’t negotiate price. All of the others will dicker with you on transaction price. A better idea is to look online for the “dealer invoice” which is how much the dealership pays the manufacturer for each car. It’s better to start from that number and go up than to start at the MSRP and go down.

  Not taking a test drive.

Can you believe that one in every six people who buy a car never drove it before buying it. A third of those people only took the car for a short 10-minute drive around the block, and only took out one car. A test drive can tell you a lot about the car: how you feel driving it, if there are any blind spots you don’t like, and what kind of features it offers. Drive between four and seven cars for the best comparison, and if the dealership balks, walk away. Be thorough, and make sure you test drive the actual car you want.

  Shopping based on monthly payment.

We’re not saying you shouldn’t have an idea how much you can afford to pay each month, but don’t make that the basis of your negotiation. Definitely don’t tell the salesperson the number. Negotiate the sales price of your new car first, without considering the down-payment, financing arrangements, and trade-in, and make an informed decision.

  Expecting to use dealer financing.

Yes, there may be signs up offering zero percent financing, but that doesn’t mean you will qualify. The amount you will pay in interest depends on your credit score. Don’t assume the dealer can make you a better offer, so shop around for comparable financing offers from banks and even private lenders before you make your decision.

You can pretty much always sell your old car for more than what a dealership will offer you in trade. If you want to avoid the hassle of selling privately, look into how much your car is worth and don’t talk about it until after you’ve settled the price on the new car. If you owe money on your old car, make sure what you get will cover what is owed, or don’t trade it. Either wait until you have paid off more, or sell it privately for enough to cover the loan.

  Not being prepared to walk away.

The sight of your back as you walk away is a great negotiating tool. If you feel suspicious or uncomfortable with a deal, don’t take it. Say you want to think about it or do some more research, and walk away. Don’t be so emotionally invested in a car that you say yes to a questionable deal. Think with your head, not your heart; be prepared to receive a call from the dealer in a day or two offering you a better deal.