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Many people dread shopping for a new car. 87% of Americans dislike some part of the car-buying process and 61% feel like the dealership took advantage of them.
It doesn’t have to be a painful experience. If you plan ahead and prepare, buying a brand new car can even be fun. Let’s look at how you can make buying a car more enjoyable.
Do Your Research
Do some research before setting foot in the showroom. Knowledge is power so the more you know, the harder it will be for the dealership to take advantage of you.
One of the most important things to research is the invoice price. This is what the dealership paid, not the suggested selling price (MSRP). When you have this number, you’ll know what their bottom line is.
Look into Pre-Financing
Dealership financing rates are higher than banks or credit unions. Check into your financing options before visiting the dealership. The bank or credit union you deal with might offer relationship discounts to their current customers.
Make sure you get the quote in writing so there’s no doubt it’s available. You might be able to use that to negotiate a better deal from the dealer as well.
Cars are commodities. A Ford Mustang at one dealership is no different than the same model at another dealership. Use this to your advantage and compare prices and offers between dealers.
One dealer might be priced lower than the others. They might have excess inventory or they could be having a slow month and want to generate some sales. It’s worth spending some time comparing offers before making your decision.
Negotiate the Deal
Don’t be afraid to negotiate for a better price, extra options, or a combination of the two. If you’re prepared to walk away from the deal if you aren’t happy with it, you’ll be in a stronger negotiating position.
Always start low so you have room to negotiate up. The dealer is likely starting high so if you lead with your bottom line, there’s no room for give-and-take.
You may also want to use a service like LeaseCosts.ca to find the best deals from the comfort of home.
Buy Based on Total Price, Not Monthly Payments
Dealers use all kinds of tricks to make the monthly payments more attractive. They might be based on long contracts like 72 months, 84 months, or even longer. Or the advertised payment might show bi-weekly or even weekly amounts.
Make your decision on whether you can afford the total price, not the payment.
Avoid Unnecessary Add-ons
Most add-ons like premium sound systems or ground-effects kits will cost more at the dealer than through the aftermarket. Extended warranties are one of the worst offenders.
Rather than buying an extended warranty, put the money you would have spent into a savings account. You’ll earn interest on it throughout the manufacturer’s warranty period and you can use that money to pay for any necessary repairs after the warranty expires.
Don’t Buy a Brand New Car on Emotion
It’s easy to get emotionally attached to a brand new car you find on a dealer’s lot. Don’t make an impulse purchase – give yourself time to think it over.
Take a day or two before pulling the trigger. You might find it’s a lot less exciting after you sleep on it. The dealer will likely hold the car for a day or two but if not, you’ll be able to find another one. New cars are rarely in short supply.
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