The average car salesperson sells about 10 cars per month. Take that number and multiply it by the number of salespeople there are working at each dealership in America and you’ve got a whole lot of cars changing hands every year.
If you’re going to be among the many buyers that pick up a new or used vehicle in the next 12-months, you’re going to want to educate yourself on what to know when buying a car to ensure that you walk away with the best deal. Our team has talked to experts and weighed our own experiences to do the heavy lifting for you on that front.
Below, we share 8 steps that will maximize the value of your next car purchase.
1. Do Extensive Research
What to know when buying a car almost 100% comes down to doing basic research. You need to know which kinds of cars are best for you and how much those cars cost on average. So, before you spend a Sunday exploring dealerships, spend a Saturday exploring the internet to find out what it is that you’re looking for and how much you can expect to pay for it.
2. See If You Can Secure Financing Before Shopping
Most people that buy cars will look to lenders to help them out with financing since purchasing a car all-cash could cost thousands of dollars. To understand how much car you can afford prior to shopping around, we recommend looking into getting financing before visiting dealerships.
Banks and credit unions both offer vehicle financing to qualified buyers that you can look into.
3. Explore Dealership Inventories Online
At this point, you should know what kind of car(s) you’re looking for, what an acceptable price is for that car and how much car you can afford per the financing offers you’ve received. You’re now ready to start browsing local inventories to see which cars are available in your market.
Tools like AutoTrader are very helpful when it comes to inventory browsing because they index multiple dealership’s inventories and allow you to filter down car options so you can see who’s carrying the exact make/model of car that you’re looking for.
4. Visit Dealers With Promising Inventories
After you’ve shortlisted a few dealerships that have cars you might be interested in, visit those dealerships in person. Find the cars that you were looking at online and confirm that they’re in the same condition that they were advertised to be in. Then, test drive them to make sure that everything runs smoothly.
If you like the car you’re assessing, you can begin the negotiation process.
5. Negotiate With Your Magic Number in Mind
Negotiating a car’s price is the most intimidating part of completing vehicle purchases. Unfortunately, though, negotiation is an integral component of the what to know when buying a car formula, especially if you’re looking to get the best deal.
In order to strengthen your negotiating position, try to appear on the fence as you test drive and analyze your vehicle. If you seem too impressed, your salesperson may feel more validated in driving up their price.
When it comes time to make an offer on the car, know your “magic number” and present it to your salesperson as such. Your magic number is the price that would lead you to buy the car right now. Let your salesperson know that if they can’t hit your magic number, you’ll keep the car in mind but will continue shopping around.
Chances are, your salesperson will meet your number if it’s reasonable. If it’s not, they’ll either counteroffer or tell you to look elsewhere.
6. Keep Your Trade-In to Yourself
If your salesperson asks if you’ll be trading in a car, tell them that you don’t think so. If they don’t ask about a trade-in, don’t mention anything.
Always try to negotiate the lowest price possible without letting your salesperson know that you’ll be looking for trade-in credit. Then, once you’ve landed on a great price, bring up your trade-in to drive down the price even further.
Mentioning your trade-in early could lead to salespeople being more aggressive in their pricing since they know that you’ll be getting a discount with your trade-in vehicle.
7. Never Buy Anything During the Closing Process
When you’re signing your final paperwork on your car, your dealership will try to sell you everything from alarms to warranties. Say no to everything.
Whatever it is that they’re selling, you can get cheaper from a third party.
8. Keep Your Leverage by Being Prepared to Walk Away
Sometimes, it’s a seller’s market in the car industry. During these periods, salespeople are going to be less inclined to cut your deals.
The best thing that you can do if salespeople don’t seem willing to work with you is to be open walking away. If you’re willing to walk away from a bad deal, you hold a ton of leverage in a negotiation.
Wrapping Up Our What to Know When Buying a Car Guide
If you understand what to know when buying a car and take the time to learn those pertinates, you’re going to be better equipped to score a great deal on a vehicle purchase.
Take our guide to heart to save money on your next car transaction! Also, feel free to read more of the stellar car content that we have right here on our blog if you need additional car-buying inspiration!