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Posted on 9/16/14 at 11:11 am to Rebelgator
The Best Way To Get A Good Deal
By Mizzeaux
Step 1. Pretend as if you're paying cash for the car in its entirety, even if you don't have the cash to do so or have a trade, pretend like you're adding the car to the family and paying cash.
Step 2. After you're satisfied with your total cash out the door price, throw in your trade. Have it appraised, know what it's worth and what you'll take for it, try to get as close as possible. (note: many states have sales tax credits on your trade, so if your tax rate is 10% and the car you're buying is $10,000, sales tax would be $1000, right? Not exactly. Throw in a $5,000 trade, you'll get a $500 tax credit towards the purchase. A lot of places will take your $5,000 trade, give you $4,600 for it, and include the tax credit in the "trade value." So they'll show you that you're getting $5,060 for the car, but in reality they're giving you $4,600 and the rest is a tax credit you'd get anyways.).
Step 3: after you're happy with your total cash difference including the rice of the car, all taxes and fees, and your trade, ask them about financing. They'll usually hit you 2% higher (max applicable by law in most states) than you qualify for, unless they're shady, which they may be. Either way, try to knock 2% off your interest rate if you can.
Step 4: if you're going to buy something in finance make it GAP insurance if you're putting little to no money down, or potentially a warranty. That's it. GAP is regulated by the states in most cases, but should cost $300-$500 depending on your term and it isn't a big markup product for the dealership. Warranties are a rip off to many people, and the dealership definitely makes money on hyphen, but if you're a paycheck to paycheck person and plan on keeping the car after the new car warranty expires, it's basically breakdown insurance you add to your car payment.
That's my advice.
ETA: after all that, if your salesman was good and patient, throw him a hundo. You just put him through the ringer for a mini commission. He probably made $50-$150 for your deal, and it took a lot longer than it should have. You've got the money, grinding bastard.
By Mizzeaux
Step 1. Pretend as if you're paying cash for the car in its entirety, even if you don't have the cash to do so or have a trade, pretend like you're adding the car to the family and paying cash.
Step 2. After you're satisfied with your total cash out the door price, throw in your trade. Have it appraised, know what it's worth and what you'll take for it, try to get as close as possible. (note: many states have sales tax credits on your trade, so if your tax rate is 10% and the car you're buying is $10,000, sales tax would be $1000, right? Not exactly. Throw in a $5,000 trade, you'll get a $500 tax credit towards the purchase. A lot of places will take your $5,000 trade, give you $4,600 for it, and include the tax credit in the "trade value." So they'll show you that you're getting $5,060 for the car, but in reality they're giving you $4,600 and the rest is a tax credit you'd get anyways.).
Step 3: after you're happy with your total cash difference including the rice of the car, all taxes and fees, and your trade, ask them about financing. They'll usually hit you 2% higher (max applicable by law in most states) than you qualify for, unless they're shady, which they may be. Either way, try to knock 2% off your interest rate if you can.
Step 4: if you're going to buy something in finance make it GAP insurance if you're putting little to no money down, or potentially a warranty. That's it. GAP is regulated by the states in most cases, but should cost $300-$500 depending on your term and it isn't a big markup product for the dealership. Warranties are a rip off to many people, and the dealership definitely makes money on hyphen, but if you're a paycheck to paycheck person and plan on keeping the car after the new car warranty expires, it's basically breakdown insurance you add to your car payment.
That's my advice.
ETA: after all that, if your salesman was good and patient, throw him a hundo. You just put him through the ringer for a mini commission. He probably made $50-$150 for your deal, and it took a lot longer than it should have. You've got the money, grinding bastard.
This post was edited on 9/16/14 at 11:17 am
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