Buying a new Car and dealing with sales people

So long story short, my girlfriend is in the market for a new car. She wanted a forester, but I would only allow her to get an XT and it's out of her price range :rofl:. So she has settled for a new Legacy. So this is my first time ever attempting to talk to sales people and negotiate on a car. I'm knowledgeable about the car itself, but need some tips and/or real experience on how to get the best price without getting rip off. I have already read through numerous post/articles on it, but just asking the community about your personal experiences. If it were to me I rather not even walk into a dealership. I feel like they will take advantage of me haha.

So far the majority of the articles I read pointed out...

1. Get pre-approved for a loan before you walk in.
2. Always talk about out the door price and not monthly payments.
3. Don't buy extra protective stuff that they try to sucker you into.
4. Be willing to walk out of the dealership.
5. Shop around other dealerships to get the best price.

Also what dealership should I be looking at. Reading through the Reviews thread....seems like it's a mix bag haha.

GO!

 

^^ Ahh yes! I read about that. I even watched a video that said you can buy a car without even walking into a dealership and everything can be done over the phone.

 

That's crazy Matt! Never knew they had a program like that LOL. Going to look into that as well.

 

Many stealerships keep their inventory decently up to date online. I used that to zero in on which ones had the cars I was interested in. Helped narrow which ones I was dealing with. We ended up purchasing my wife's forester from Stivers.

 

I bought a car from a dealership once and never again...

4 of the 6 dealerships that I went to lied that they had the car i was looking at but somehow sold right before I came. Even if it was just an hour in between.

If going through a loan, your best bet is to walk in preapproved by your own bank or a 3rd party. Those guys will try to rip you a new one with their so called warranties and "good" rates.

 

I always buy cars using a segmented process.

1. Secure financing before walking through the door, but dont tell them this until youve settled on a price.

2. Find vehicle, settle on out the door price. Focus on out the door price as this will include their docking/paperwork fee and tax/tag stuff.

3. Ask if they have any incentive options if you finance through one of their banks. Often times the local banks they use will give them a rebate of $500-$1k (that you never see or know about) for completing a loan. Once your price is settled, tell them you have your own financing but will allow them to match it/beat it if they can reduce the price by whatever incentive they may be getting. This has actually worked for me not once but twice.

4. Once you get to the back room, finance dude is going to offer you oil changes, extended warranties, magic paint coatings that protect you from space radiation, etc. No thanks, no thanks, no thanks, thanks but no thanks. You can still walk away if they try any funny stuff.

We had to walk out on Milton Martin Toyota because they wouldnt negotiate on a $500 docking fee that was printed on the final paperwork that they couldnt erase. They let us walk out, then 2 guys chased us out in a rainstorm and said their boss changed his mind and would lower the vehicle price $500 to offset the "non-negotiable" docking fee.

 

If its a used car look at the carfax for it. The carfax will usually tell you when the dealership took "ownership" of the car. Obviously the longer a car has been on the lot the more willing they will be to give you a good deal.

Also as you previously mention be willing to walk away. Sales people hate that and again they will try to get you back in by lowering the price.

 

As a rough rule of thumb for every $1000 you owe on your lease you pretty much pay 2% $20/mo of the TOTAL price on a 60 month term (ex $5k= $100/mo, $15k= $300/mo etc; Promotions will be a different pricing as the need to frequently liquidate inventory.) That'll help you narrow what you can afford as a budget is concerned.

Biggest advice as previous mentioned dont be afraid to walk away and say no. Don't impulse buy if you are pressured.

Don't settle for a vehicle you don't want. Say you want a WRX then buy a WRX. Don't drive off in an Impreza.

My personal rule. Lease it if it's new. If it's used buy it in cash in full or only buy what you can afford.

 

Yep, you WANT to buy a car.
They, on the other hand, NEED to sell a car.

 

It's worth mentioning that every dealership's "job" is to move the metal. They need to sell what's on their lot. Yes, they can get you a car from another dealer, but it doesn't help them keep their own inventory rotating.

With that in mind, watch the lots. A dealer is going to be MUCH more motivated to sell a car that's been on the lot for 80-90 days.

 

Thanks for all the great info! Keep it coming. This should help out other people as well.

 

If you need financing, you should always get pre-approved before you even start looking for cars. Join a local credit union to get the best rates; they will usually beat your big banks like Wells Fargo and Bank of America. When you go to the dealer negotiate the price before you tell them you are pre-approved. They get spiffs from the bank on every deal they send over, and there is usually a rate markup; so its in their best interest to finance you in house.

TAKE THE VEHICLE OVERNIGHT AND HAVE IT INSPECTED

^^^^^^I cannot stress this enough^^^^^^
A $100 inspection could save you thousands in repairs later on.

The most important thing you can do is have the car inspected by your own mechanic or someone you trust, who can put the car on a lift and look underneath. Many dealers will hide or mask problems that you wont notice right away or won't be noticeable before the car is in the air. Drive it as much as possible while you have it to make sure there aren't any little quirks or problems that didn't pop up during the test drive. Research the car thoroughly before you start looking and have your mechanic check the items that are notoriously bad.

CARFAX and Autocheck are both good resources but they are not always accurate. There are tons of cars out there with bodywork all the way around with clean CARFAX reports.

When you leave the dealership with the vehicle for your inspection, make them give you a Bill of Sale or Purchase Order with EVERYTHING included. Make sure they haven't thrown in any Protection Packages or Extended Warranties that you weren't aware of. Some people get so fixated on the "Out the Door" price that they don't look to see what it actually includes.

This also gives you time to think about your purchase. Sleep on it and make your decision at home, without a salesman there pressuring you into it.

 

A lot of great info in this thread. People should find this helpful for many days to come.

 

Carfax and autocheck are great but it has to be reported to be on file. I had many cars that had accidents (track events) but didn't report them because i knew insurance wont cover it. Just replace fenders and arms was not a big deal. Just to say that there's people that wont report things to insurance companies in the real world (ie Please don't call the cops I don't have insurance I'm sure we can work something out) so a good eye is needed when you look at the car. Never look at a car in the evening under no circumstances. You cant distinguish body imperfections or leaks and such.

Another thing to consider is for when buying used. I can only speak when I was a tech for Honda & BMW but its pretty Standard across all dealers I worked for. The used car department will only invest so much into a car before it affects their profit margin. This will determine what cars need repairs or what has been done.

All cars regardless of make and mileage will receive an oil change, applicable warranties, and a 150 point inspection (feels more like a 20).

Vehicles under warranty (<36,000 miles or under Makes warranty period) will receive ALL needed repairs and ALL scheduled maintenance. These vehicles are generally called Certified pre-owned.

Vehicles out of warranty period up to 60k will receive scheduled maintenance, brakes, and tires. These are your standard USED vehicles. Secondary warranty coverage is usually offered for these vehicles.

Vehicles with higher mileage or a "grey make" vehicle (ie purchasing a Subaru at a Lexus dealership) get no love. Only safety issues are covered (tires and brakes.) Usually the budget is very strict on these vehicles for repairs (ie a STI needs 4 tires but only 1 is considered unsafe, they are only repairing 1 tire). Both Honda and BMW used car dept (at the time) would not invest more than $250 in repairs. If it did it would be a cash only car or it gets sent back to the auction.

this might sound confusing or might not make sense but i hope it helps

 

I thought I'd add to this thread even though it's a little dusty.

Try to go at the end of the month, especially if it's the last day of the month. The sales people are far more likely to cut you a deal because they're trying to pad their numbers for the month.

There is no such thing as a "required fee"; don't let them tell you that it's the law or some other kind of horse crap. I got up from Stiver's Subaru and started to walk out because they tried to add on nearly $1000 worth of fees at the end. You have the power to get up and leave, they can't stop you, and to them you are a giant dollar sign walking away from the table. Use that to your advantage.

Never let the dealer finance your car unless it's a 0 or .99% APR loan for at least 60 months. I didn't go the Credit Union route, but I still got a 0.99% APR loan for 72 months from my bank/credit card company. I had to set up a checking account and auto-pay to get an extra 1% off (initially the loan was 1.99% APR).

Had a credit card for forever and a day? Call them up, they're likely to give you a good deal on a loan because you've been with them so long.

Never let on how much you want a specific car. The sales people will eat you alive if you do.

Don't be afraid to waste their time if they try to waste yours. If you're not getting any satisfaction, and it turns into a back and forth thing, ask for another test ride, or ask to drive something different. Say you'll think about it and just sit there. Do whatever you can to eat up their time if they're trying to be clowns. Obviously you wouldn't do this if they're being straightforward with you, though they seldom are.

Bring a friend with you, that way you won't be alone and you'll have someone to consult with.

 

Honestly, I recommend the Costco route to anyone looking at new cars.

In any car purchase there's three negotiations:

1. Cost of new car
2. Value of old car
3. Financing needs

With the Costco program they literally hand you a sheet with what Costco has negotiated for the difference from the invoice price and then show you the invoice. I got my WRX through the Costco program and the negotiated rate was $500 below invoice or something like that. SoG said that they no longer participate in this program when I asked them, and they said the prices just match up with the TrueCar pricing. I don't know if this is true or not (SoG doesn't seem quite trustworthy) so I would find the Costco dealer again instead. This takes care of 1.

If you want to sell your car yourself, that takes care of 2. Or you can negotiate the value of the trade at the dealership if you want. Just know what your car is actually worth (and keep in mind you are probably saving yourself some hassle by making the dealership sell it).

If you get preapproved for financing through your own sources you've resolved 3.

As others have said, separate all three of these negotiations without discussing the others. When they combine them into one negotiation, it is much easier to roll in hidden fees or other profits for them.

 

Stivers has terrible customer service and service in general but you can negotiate prices with them via e-mail and they're usually really straightforward

 

Honestly, I would never recommend Stivers to anyone. I bought my STi there but only because of the price.

 

Go see Eric at Classic. Problem solved.