How To Buy A Car
by
Cary Tate
Contents
● First things first
● Offering referrals is your ticket
● Your trade
● Getting ready
● Gathering important information
● Consider your cost
● Schedule a time
● Working with your salesperson
● The presentation
● The test drive
● Negotiating your price
● After the sale
● The F & I office
● Taking delivery
First Things First
First, I'd like to say thanks. I hope you find it much more valuable that the paper its printed on. So much so that you will want to share it with every driver you know.
For most people, buying a car is a big deal. Contrary to the opinion of some, it is NOT the same as going to Wal-mart and picking one out. It is a serious business transaction where an exchange of values takes place. Drivers need to have transportation and the people delivering the car need to earn a living. However, it doesn't have to be painful if you work with someone you know and trust.
Car sales people are stereotypically pegged as untrustable souls. Because of the bad reputation of the typical car salesperson, its actually easy to stand out. As a rule, smart folks don't regularly do business with people they can't trust. As buyers, when our trust is betrayed we feel violated and take measures to protect ourselves from future disaster. On the other hand, unless we take things by brute force, we have to allow a limited amount of trust to get anywhere in this old world. You could say its part of the foundation of the American economy.
So imagine the immense value of someone you consider a friend in the car business. They are out there. You just gotta find them. Ask everyone you know, “Who did you get your car from.” Ask about their experience and would they recommend their salesperson and dealer. Chances are they will, because like I said earlier, we do business with people we trust.
Offering Referrals Is Your Ticket
I can assure you if you offer a couple of referrals the salesperson will have a huge stake in treating you fairly. And fair is the absolute best you can hope for. Yes, getting a fair deal is better than a lopsided deal where the salesman will run and hide if you ever set foot in the store for fear that you found out how much he got you for. Or he'll run and hide because he made so pitiful little he simply can't afford to take care of any problem you might have. In either case, fair deals work for the long haul. Any dealer who has any sense at all can see that. And he'll be known for being fair so it shouldn't be hard to seek him out.
Your Trade
Think about what you like about your current car and what you hate.
Have your car clean. Especially on the inside. The outside is relatively easy to clean but when the appraiser gets behind the wheel of your car its hard to see how well the interior will clean up if its really dirty.
If you have an extended warranty, use it before you bring it in to make repairs on the vehicle to maximize your trade value. After you trade it in you can cancel for a refund of the unused portion. Then you can use this refund to help pay your taxes.
A few words about trade values:
There are at least three different “books” to use for trade values and none of them agree. Ultimately the appraiser is going to guess what he thinks its worth based on other factors like location and traffic but mostly he'll use local auction prices. Auctions prices are real transactions that reflect the actual market value. This is a “wholesale” price. Don't expect to get retail for your trade. If you want retail you have to earn it by selling it yourself. To some people its worth it. For others its just not practical. The dealership will give you market value for your trade and then discard it via auction, assuming the risk that it will bring what they bid for it at the time of trade. If it is a good, clean, low mile car they might recondition it and put it on the lot for resale.
Getting Ready
Salespeople are trained to ask you certain questions. These questions help the salesperson narrow the selection to cars that you are possibly interested in. Its kind of like a doctor trying to figure out what you need. Being prepared with your answers will speed along this part.
Car, Van, Truck or SUV? New or Used?
Light or dark colors? Cloth or leather?
How many seating? Work or pleasure?
Large or small engine? Base model or more equipment?
Automatic or manual? 2wd or 4wd?
2dr or 4dr? Coupe or convertible?
These are just a sample of the questions you might hear. Even better if you have a printed list to give him but its not likely you'll avoid all the questions. You don't have to know everything. In fact, allowing a good salesperson to help you here is how he earns his keep.
Gathering Important Information
Get your Credit report and know your score.
● Equifax.com
Get your loan information secured or at least quoted and an approval letter.
● CitiFinancial.com
● Driverloans.com
● Automotive.com
Learn the market values of the cars you are interested in.
● Edmunds.com
● Cars.com
● CarsDirect.com
Don’t forget to get an automobile insurance quote from your agent. In fact, while your at it go ahead and get a couple of comparative quotes online.
● Gieco.com
● AIG.com
● InsureMe.com
If you are considering an extended warranty for your new car, be sure to get a quote or two on extended warranties. Be sure to compare apples to apples when doing this. Length of coverage, what is covered, what is not covered, deductibles, etc.
● Warrantydirect.com
Consider Your Cost
A good thing to know before going to get your new car is to consider your current cost of ownership. Remember, price is what buyer and seller agree on but cost is what you pay to drive the car over time. Cost includes depreciation, fuel, maintenance, repairs, insurance etc. Try and recall how much you have spent for repairs and upgrades in the last year.
Brakes _______ Maintenance item _______
Tires _______ 60,000 mile service _______
Alignment _______ Air conditioner _______
Belts & Hoses _______ Struts _______
Wiper Blades _______ Exhaust _______
Filter & Flushes _______ Fuel Injectors _______
30,000 mile service _______ Power windows _______
Transmission service _______ Radiator _______
Total _______
If you want to break down your costs monthly, then divide the total by 12. Then add up your other monthly expenses.
Total / 12 = ______
Fuel ______
Insurance ______
Payment ______
Other ______
Total Monthly Cost ______
Schedule A Time
Its a good idea to always make sure your salesperson is available by scheduling an appointment. If you cannot make the appointment let him know. Your salesperson has deliberately not engaged any walk-in customers so he won't be tied up when you arrive. If you just don't show it will cost him and will likely set things off to a bad start. Having an appointment will keep you from having to wait. But more importantly it will let your salesperson know your are serious and your time is valuable.
Working With Your Salesperson
If you have done all your preparations finding your car is the next step. By now you should have a pretty good idea what kind of vehicle will suit your needs, desires, and budget. You should have at least the name of a reputable salesperson. By the way, by finding a reputable salesperson you have eliminated about 90% of the potential headaches and problems of buying a car. A reputable salesperson is much more likely to have your best interest in mind. He knows the benefit of satisfied customers. He has a reputation to protect. But even a great salesperson may have to contend with nearsighted, and nervous management. So don't neglect to arm yourself with all the information you can to give yourself the best chance of getting a great car deal.
Be sure to give the name of the person who referred you. Consider it a form of insurance. Your salesperson will know he has more than one sale on the line. And of course, as I mentioned earlier be prepared to give referrals when you take delivery.
The Presentation
If you haven't already picked one out, your salesperson will ask questions about what your looking for and then will search the inventory for what he feels is the closest fit. The questions during this interview are very important for his presentation. If he is a good listener, he will explain why he thinks this is a good fit. They call it in the retail business a feature / benefit presentation. This is where you can see how good your salesperson really is. If he is telling you about costly features that you don't care a thing about, then you might as well get someone else. Its just going to go down hill from there. If he is telling you about all the benefits that are important to you then he was listening to you during the interview.
Test Drive
Once you have been given a presentation on the vehicle you are ready for a test drive. Here is a list of some things to consider.
Seating
● Are the seats comfortable
● Can you adjust easily
● Can you get in and out of easily
● Is there plenty the headroom
Dashboard
● Can you reach all the controls
● Can you see all the guages
● Is the steering wheel comfortable or adjustable
Steering
● Does the car drive straight
● What is the turning radius
● How many turns of the wheel from lock to lock
● Does the wheel turn easily
Power and Transmission
● How does it shift
● Is there enough power
● Does the engine run smoothly
● Is the exhaust quiet
Brakes
● Smooth stops with no pulling to one side
● Does the ABS system work properly
Suspension
● Is the suspension too hard or soft
● Does the car lean on turns
● Does the car bounce and hop after bumps
Visibility
● Can you see well over the dash
● Are there any potential blind spots
● Do the mirrors cover all the blind spots
Noise Level
● Is there any wind noise on the highway
● Any rattles or squeaks
Negotiating Your Price
Next is the part we all know and love. Many people think that it would sure be nice if the dealer would just put his price tag on the car like a product on the shelf at Wal-Mart. There are a few “no haggle” stores out there but trust me if you didn't haggle you probably paid more than you could have.
A car, much like a home, is a big ticket item and there is a fluctuating market. Just like on the floor of the stock exchange the price is set by the twin forces of bids and offers. Where the twain meet is the market price. It is a discovery process and need not be feared. If you have done your preparations you know what you are willing to pay for the car. But you might get to pay less. The dealership is thinking the same thing. They know what they would sell the car for. But they might get more. So the discovery process begins.
My advise for anyone negotiating is - do your homework. You'll solve most of the fear problem during negotiation by working with a reputable salesperson. By doing your homework you should know what is a fair price. Any dealer would be a fool to refuse any offer that makes business sense.
Even if you try to be unemotional about negotiations you may find yourself getting excited about owning your new car. Well that's OK. Remember you are there to buy a car! Just try and keep yourself in check.
After the Sale
Next you will be introduced to an after market specialist. This is done prior to finance because its easier to add things to the loan then to take them off. You can get most of the items here through other vendors but products offered by the manufacturer and will not void the warranty.
Other products will help protect your investment such as paint sealers and fabric protectors. Just like in the car buying preparations, ask your friends who have purchased these items and see how they liked them. If you don't know anyone who has tried them ask for testimonials that you can confirm.
The F& I Office
The last step of paper work is the financing and insurance office. If you have done your homework you will have a good idea what your rates and payments will be. You should have a good idea what the factory warranty covers and what extended coverage will cost. If you are financing a considerable amount more than the replacement value of the car, then you should consider gap insurance. It will cover that difference in the event the car is totaled.
Taking Delivery
This is where you get to examine the car and sign off. Look over the car very carefully and look for any flaws that are unacceptable. Once you sign the delivery acceptance you cannot expect the dealer to fix a scratch that occurs later. This is also the time to offer the referrals to the salesperson. It is your way of tipping him if he has done a good job. Your referrals need not be someone who is currently in the market but someone that trusts you. A good salesperson will not hound your referral. If he treated you with respect its reasonable to assume he will treat your referral that way as well. But it would be proper to get your referrals permission prior to going to the dealership.