How to Buy A Car For a Good Price And Not Get Ripped Off

The car industry is witnessing a nuanced landscape with sales dynamics influenced by economic recovery, technological innovation, and shifting consumer preferences. New vehicle sales in the U.S. are expected to rise to their highest ever, driven by improved affordability due to lower interest rates and a normalization of vehicle inventories, which have led to increased incentives from manufacturers.

Globally, sales are projected to increase modestly, with electric vehicles (EVs) gaining market share despite challenges like charging infrastructure and consumer range anxiety. Concurrently, there’s a noticeable trend towards smaller, more affordable vehicles, as economic pressures push consumers away from larger, more expensive models like SUVs and trucks.

1. Secure Financing in Advance: Get pre-approved for a car loan from a bank or credit union before visiting the dealership. This not only gives you an idea of what you can afford but also serves as leverage when the dealer offers financing. Often, external financing can come with lower interest rates than dealership offers. If the dealership can beat your pre-approval rate, great; if not, you’re prepared to stick with your loan.
   
2. Talk Total car price, Not Monthly payments. Car dealer love to talk about monthly price, and hide the amount of months the contract is for. The trick here is they will tell you the car is only 199 a month, but make it a 5 or 6 year loan. That is a 71 month loan for 199 a month. Is it still a good deal?
   
3. Negotiate the Out-the-Door Price: Instead of discussing monthly payments, focus on negotiating the total price, with ‘out-the-door’ price of the car. An experience buyer will go into a dealer and tell them they are not paying these fees. The dealer will do it to sell the car, its only about $800 depending on your state. Be a man! be strong! This includes all taxes, fees, and any additional charges. This approach prevents dealers from inflating the price through extended loan terms or high interest rates disguised within manageable monthly payments. If the dealership cannot meet your price, be ready to walk away, as this often prompts them to come back with a better offer.
   
4. Avoid the aftermarket warranty and sales pitches, this is where dealers make most of their money.
   
5. Try to buy in November or December at the end of the year, when dealers need to move inventory for the next years newer cars that are coming in.
   
6. Dont be scared to leave the dealership and tell them you want to go home and review the numbers. Then go shop around to other dealers and see what deals they offer you.
   
   I went to one dealership and they offered me a car without power windows and no bells and whistle for $399 a month and $4000 down.
   
   I went to a bigger dealership 30 mins away and they gave me the same car with a higher trim level for $250 a month and 0 down.
   
   So the dealerships do matter. Some sell more cars and can give you a better price, the smaller lots dont sell as much and must charge a higher price per sale to make up for the difference.