10 sneaky car dealer tricks
Here are some tricks of the trade -- some more devious than others -- that you might encounter when you shop for a car.
This post comes from Angela Colley at partner site Money Talks News.
The first time I bought a car, I got ripped off. I traded in my car for less than it was worth, bought a clunker for more than I should have, and got talked into a $950 warranty to cover rust as I was finalizing the paperwork.
The salesman saw me coming and pulled out every trick in the book -- from saying my credit wasn't good enough to tacking on "mandatory charges" during the final sale.
Dealers want to talk payments; you need to talk price. For example, the last dealer I met asked me how much I could afford to pay a month. When I didn't answer, he offered a "great deal" at $385 a month. He never mentioned the total price of the car or the length of the loan.
By focusing on payments and not price, it's easy to trick consumer into thinking they're getting good deals. Steer the conversation to the total price, and let the payments take care of themselves.
A dealership can make as much money on the loan as it can on the car, which is something it's not likely to disclose. Instead, the salesman will make it seem that he's doing you a favor by getting you a great interest rate -- or getting you a loan at all.
Don't fall for it. Financing is big business for dealers, and you're not winning a prize when they get you a loan.
Step One in any purchase that requires a loan is to secure financing. Never head to the lot without first shopping for -- and getting preapproved for -- a loan. Use online auto rate searches and talk to banks and credit unions to find the best rate. Then apply and get approved. This serves two functions: You won't overpay for dealer financing, and you'll be ready to pull the trigger when you find the perfect ride.
3. Bait-and-switch advertising
Bait-and-switch gets you in the door by advertising a super deal on a car, but switching you to another, lesser deal when you show up.
Read the fine print before you go to the dealership. If you're not sure, call ahead.
4. High-pressure tactics
The salesman's goal is to close the sale today, and he'll try any number of sales tactics to make it happen. My personal favorite: Insisting the car won't be there tomorrow.
Don't bite. If you feel uncomfortable or unsure of any decision, ask to speak to someone else or just walk away. Keep looking until you find someone you can work with.
5. Extras that add up
Car salesmen work on commission, and the more you pay, the more they make. One way to increase the sale price is by adding on extras, like wheel and tire protection, a warranty extension or rust protection. To help sell you on these, the salesman will break them down to the total price per month. For example, when I bought rust protection, the dealer told me it was a "great service for only $25 a month." I ended up paying $900 over three years for something I didn't understand or even know how to use.
If you're trading in your current car, know its value. These sites can help:
Also, check eBay to see what cars like yours are selling for in your area.
If you're trading in, don't expect any dealer to offer your car's retail value. To get maximum value for your car, sell it yourself.
7. Manufacturer's suggested price
The "manufacturer's suggested price" is often used to make a deal sound better. For example, if the manufacturer's suggested price is $35,000, but the dealer is asking only $32,000, you might think, "Hey! I'm already getting $3,000 off and we haven't even started negotiating."
Sites like KBB.com can tell you what people are actually paying for specific models.
8. Your credit score
When I was buying my first car, the dealer pulled my credit report and told me my credit wasn't that grea,t but that he'd be willing to work with me. I felt a sense of relief, thinking, "At least I'm getting a loan." I later found that my scores were fine and that I could have gotten a better interest rate elsewhere.
Buying a car isn't one big transaction; it is actually three smaller ones: getting financing, pricing the trade-in and buying the car. I didn't realize this when I went to the dealership alone for the first time. Rather than look at each piece, I looked at the total cost and thought, "OK, I can afford this."
Negotiate each part separately to get the best deal.
10. Mechanical issues
Don't take the dealer's word for the condition of a used car. Never buy any car from any source without first taking it to an independent mechanic for an unbiased inspection.
More from Money Talks News and MSN Money
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- Car buyers stretching out payments
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I worked at one of those non negotiating places called carsense. This is proof of how stupid the consumer is. They love buying cars from these places but are willing to pay thousands of dollars more for it. How does this make sense?? Consumers are morons.
I've been to a place where they refused to tell me the total cost of the vehicles. Every one on the lot had the down payment required on the window, and the salesman had info for the monthly payments. When asked the price of the car, he kept repeating the payments. I practically screamed 'No! I want the TOTAL COST of the car.' He said he wasn't allowd to give me that information. Not allowed?! I walked off, saying how the hell do they expect me to buy something when you won't tell me what it costs. A few months later that place was out of business. I wonder why....
A couple of things which are not covered in the article.
First it is not necessarily a bad thing to let the dealer's F&I person arrange financing. Often times the dealer can actually get a better rate. Also, since dealers often receive a payment for arranging financing, the dealer might be willing to sell the vehicle at a lower price. The key is for the buyer to know the rate he or she qualifies before going car shopping and to let the dealer meet or beat that rate.
Second, Credit Karma is a free service which provides a somewhat accurate approximation of a person's credit score for free.
Finally, the buyer should utter only one word in the dealer's F&I office, NO! Every product sold in the F&I office is vastly overpriced and usually useless. The buyer needs to understand that friendly face in the F&I office is actually the dealer's top sales person whose job is to get as much back end profit from the car buyer as possible.
This article is worthless! Angela Colley has no business writing about something she has no clue about.
Most dealers are honest and reputable. My son who works for the Attorney Generals Office told me complaints about car dealers are at an all time low. Anyone who uses Angela's advice when going into a car dealer deserves to be kicked out. Be honest and courteous with the salespeople and they will in return treat you fair. If you're looking for a fight, that's what you will get. My wife and I purchase a new car every two years and we have never, NEVER experienced anything like this worthless article states.
We treat the salespeople with respect and in turn they have always done right by us. Salespeople are human beings, most with families. I'm sure they are sick to death of cheap skate customers who come in and want to screw them for every cent and treat them rude.
IF YOU LIVE LONG ENOUGH YOU REALIZE IF SOMEONE HAS A REPUTATION THEY HAVE EARNED IT!!!!!!!!! Why do you think they call them STEALERSHIPS!!!!!!!!!!!!!
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