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
- Tricks of the trade: Restaurants
- 7 simple steps to winterize your car
- Tricks of the trade: Credit cards
- Smart Spending on the go: Get our app for Android or iPhone
- Car buyers stretching out payments
- Should you get a 7-year car loan?
Well, I agree that car salesmen do less work for their money than just about anybody, except that is from the guy who hijacked the PC from IBM. IBM and Intel did ALL the work, and some other company wrote DOS, and an opportunist stole the whole package from them. On top of that our tax dollars built the internet, and Microsoft uses it to sell advertising and make yet more money.
So, you self righteous whatever you really are, whoever is without sin may cast the first stone.
When I see ads on TV where a new car dealer is offering cars at up to $10,000 off, then I know that thay are OVERPRICED TO BEGIN WITH!. I don't care if it is the end of year model sale, inventory sale, or any other kind of sale, anything that has that big of a discount is way over priced!!! That is why people expect to negotiate a lower price on cars when they go to the lot.
Watch them squirm like a kid looking at a piece of chocolate cake that Mom says they can't have until after supper. Then tell them YOUR offer and tell them THEY can take it or leave it.
i have been in the auto business for over thirty years in f&i and have never abused,pressured
or lied to a customer and have never worked for any dealer that would allow anything like that
the same msn writer is suggesting that you go to your friend at a bank. my friend there are alot
more bankers in jail for fraud and other white collar crimes than any car dealers. remember the
fees they were charging and abusing people with bad credit.
my point is this ediot has to write something that will catch your eye. some of the dealers in my
area have been in business 75 to 100 plus years, as you know deceptive and dishonest companies
do not last that long. remember dreamaway?
i do know there are some dealers out here that do business as you have stated but check the bbb
and check them out and listen to their offers.and compare them to the other offers you may be
surprised and save some money. at least you will know and not just wander into a bank and
think their profit is no concern. this is what this article is telling you to do and assume everyone you speak to is a crook. you are the one making this decision.
You missed one of many more. Documentation fees. Sometimes
as much as $500. This for doing the paper wook. LOL
It's called fraud, folks. Most salesmen engage in it with the implicit approval of the dealer or his general manager.
Best bet: look at the dealer, buy through a broker.
OMG - yet another out dated thieving dealership story. Believe it or not, it's not the dealership that makes car buying a hassle, it's the consumer. They read these goofy stories from goofy people like this writer, and go into a dealership with a chip on their shoulder. Those who go through life always expecting to be ripped offf, will be, just ask them.
The internet has leveled the playing field for both dealer and consumer.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
ABOUT SMART SPENDING
LATEST BLOG POSTS
Saving just a single month of expenses may take longer than you think. See how your savings rate affects how quickly you can build a solid emergency fund.
VIDEO ON MSN MONEY
BLOGS WE LIKE
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'