Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
Options
Comments
Terry.
Looks like this site is full of helpful people, so thanks in advance for your replies.
Before you jump, make sure your not giving up some substantial rebates for not financing. We have some new cars that offer up to $1000 additional rebate for financing....if thats the case you usually have to keep the loan open for 90 days and then pay it off....you gain the rebate at a tiny cost.
BTW: I read you bio. For what manufacturer(s) are you an authorized new car dealer? Just wondering...
But because of certain allotment perimeters, bonus structuring, floorplan restraints, the weather and just maybe some bad luck, if never quite seems to work out that way ... that said, some get a little lucky because the car gods were lookin' their way and the factory wasn't pushing something down their throat
Terry
The ONLY dealers that I have ever seen accomplish this was a dealership that my brother worked for. The principal would have a carrier show up on October 15 and load up all the convertables and send them down to his dealership in Florida and return with all of the cars that were misfits on the Florida lot.
Terry.
Terry.
So I've gotten several online quotes in the D.C area for an 06 Corolla LE with side/curtain airbags, ABS, & audio value package. The best yet is $15,225 (including freight & $500 regional incentive) + taxes, tags, & processing of course. But, I don't really know what to do from here as far as negotiating goes.
Question #1- About what would be my best possible OTD price?
Question #2- In this age of online car sales, is it appropriate to negotiate with the higher quote dealers by asking them to beat their competitor's quote online or wait to do it in person, or does it not make a difference.
Thank you!
"Question #1- About what would be my best possible OTD price?"
Take the price of the car including transportation and add 3.1% VA sales tax and $50 for tag/title.
My advice is to compute the OTD price you are willing to pay. Then go the dealer of your choice and offer that price. No negotiation is necessary.
I take one check already made out to the dealer in the amount I'm offering. It does keep things simple.
If the quote you have is lower than what these sites are quoting, reply back to the dealer. Ask them to confirm the color and the options. Ask them for the vin and/or stock number, to make sure that the quote is for a real car and it’s not a ploy to get you into the showroom. Most importantly ask them for the itemized OTD price. Like you said, it should include taxes, tags and junk fees (i.e. the processing fee). If you choose so, you can print out the email response and take it to the local dealer to match the OTD price (let your conscience be your guide
Before you go to the dealer, go to your Credit Union and get pre-approved for a loan. This way you know the maximum interest rate that you will need to pay. Go to the Bankrate.com and calculate the monthly payment that’s based on the OTD price. Do not tell your salesguy that you are pre-approved. In the F&I office, the only thing that might be worth buying is the alarm system, but don’t pay more that $350 for it (that how much it costs at Circuit City). You should refuse all the warranties and insurance products that he will push on you. The F&I guy might offer to beat your pre-approved rate, that is ok as long as the monthly payment is lower than what you calculated.
Also, in DC area stay away from both Koons Toyota stores and be on high alert at either one of the Darcars stores. Virginia state sales tax 3% if you buy in MD, it would be 3.1 to 3.2 if you buy in VA, local town surcharges. MD dealers are forbidden by law to charge more than $100 for the processing fee. VA dealers charge whatever they feel like, the average is about $300. Make sure you keep that in mind when you are calculating the OTD price. Good luck.
Why lie.? .. they're better off showing their letter and disclosing it right away and go on with the actual purchase if they come to terms .. it makes it 10 times easier for the customer and dealer ...
Terry.
To expand on the other posts, there are so many factors that go into determining your interest rate that we can't tell you without knowing all of them.
For one, "decent credit" isn't particularly specific, and could cover a wide range of scores that make you creditworthy without being top-tier. Additionally, your income, work history, and credit history (different from credit score) can be factors in getting a good rate.
Also, the amount you're financing, the term (number of months) and the vehicle you're financing affect the rate you'll pay.
For more discussion on this topic, you might visit our discussion called Credit Scores and Vehicle Financing
MODERATOR /ADMINISTRATOR
Find me at kirstie_h@edmunds.com - or send a private message by clicking on my name.
2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
Review your vehicle
Some people sa Feb is the best time to buy a car in New England, and that quotas get set higher. Is there any truth to this? Is February a better month than others (excluding, I guess, dealers at the end of the summer getting rid of last year's models).
Are these discounts sponsored by the manufacturer's? Or, are they just another promotion that really doesn't affect the cost of any particular vehicle? Are the discounts additional to what's already being offered elsewhere?
Terry.
The discounts are very real ... and they make great sense. Always hit people with a discount when they are thinking about your product. Besides, what else is there to do in Chicago in February??
I cannot believe the enthusiasm for all these vehicles in a market where everyone appears to be driving newer metal.
First, it's not a lie, it's a temporary withholding of information that will be provided prior to closing. In a negotiation, timing is everything, and you need not show all your cards until the moment is right.
Exb0 is correct -- it's best to withhold this information from the dealer for as long as possible. Reasons:
-Once you've begun your price haggle, you do not want the dealer to move the discussion toward financing. This will give him an opportunity to attempt to move the discussion away from price, which is your most important item to resolve before moving to the next step, i.e. making sure that are no extraneous fees, etc. packed into the OTD.
-Keeping the opportunity to finance is equivalent to the proverbial carrot on a stick. This is good for the buyer -- you want the dealer to believe that there is always the opportunity later to rope you into financing (and more to the point, the dealer fees that accompany that financing). Let him think that until you've established the price, and you can remove the carrot later. Tell the dealer too soon, and he'll negotiate knowing that this is off the table, and may be reluctant to go as far as he would were this possibility still up in the air.
I'll bet that "concept" goes over real well with your other half ...l.o.l.....
This coming from the person who said "I don't want a friend, a confidante, a teacher, a big brother or consultant" .... now I know why.
Terry.
That's absolutely true. Before you go onto the lot, if you intend to finance the car, you should (a) go to the lot pre-approved and (b) know how to calculate a loan payment (bring a calculator, and carry it discreetly with you.)
Only borrow from the dealer if you get a better rate or terms than you can from your bank/credit union/etc., and then double-check his figures to make sure that they are correct and that the monthly payment matches what it should be. Remember, if you know (a) the amount of the loan, (b) the interest rate, (c) the length of the loan and (d) the amortization method -- be sure to avoid the Rule of 78 if it is allowed in your state -- the monthly payment offered by the dealer should match your math.
The point is that in an ideal world (from the standpoint of the dealer), the customer would do several things:
-Purchase a car (remember that there are several areas for profit here -- there are other sources of revenue to the dealer, other than the amount above the invoice)
-Load that purchase with additional add-ons (options, undercoating, extended warranties, fabric protector, insurance, etc. etc. etc.)
-Finance the purchase of that car with the dealership, or lease it through the dealership (financing fees)
-Trade-in his/her previous car (and have a car worth trading in)
ALL four categories create opportunity for profit for the dealer. The dealer would like to capture all four if possible (although of course, he will settle for one.)
There are several ways to go about the process, but the dealer is always aiming to get all of them, and may give up in one area to get it back in another.
So when you negotiate price, remember that the sales manager may be quietly thinking that what he gives up on price might be captured back in one of those other three categories. But if you make it clear early in the game that some or all of those other three categories are off the negotiation table, you have essentially told the dealer that he has fewer opportunties for profit than he would have preferred, and he may try to offset that by demanding a higher sales price than he would have accepted otherwise.
Also, I assume that transporting via a flat-bed is pretty expensive, and a lower cost alernative would be to have the cars drivenr from one location to another, assuming they are close enough. Again, what are the costs incurred by a dealer for things like this?
Hi line cars are not driven unless in same metro area. (At least for Audi)
Yeah same for us when it comes to flat bedding everything cause the closest dealers are 50 miles or more away.
I have a re-PDI done on all vehicles but that cost comes out of the gross of the deal. We don't ever have a deal that is so skinny that we charge the customer for the recheck.
How close would it have to be to not flat-bed, and how much can that run - some hourly wage to a driver?
I would prefer to have the vehicle shipped into the dealership but I do my share of sending drivers to get a dealer trade. I have been lucky over my 10 years and have not had any major problems but it is always a numbers game. I will have a dealer trade involved in an accident and I can only hope everyone will come out of it alright.
Remember, it is just a car deal....try to be understanding of the big picture because no one wants your car at the dealer quicker then the dealer does!
A couple of months ago, talking to my salesman while buying a car. He told about an unfortunate happening a few days previously. The dealership was swapping out a van for a van I think. The 'other' dealership was wanting the swap. Before the driver got to our town, he ran off the road. Messed up a wheel and suspension. The van was brought in on a wrecker truck.
The driver wasn't hurt, at least not appearance wise. My salesman said he was there when the driver got a cup of coffee. He was either shaking or so uncordinated he spilled a lot of the coffee trying to drink it. Salesman noted the driver was missing a couple of fingers or so on one hand.
The driver said he was ok. And ready to take the swap van back to his home dealership. So he took off. And rolled this van before he got it back. I don't think he was badly hurt this time either.
But, think about what a mess this is. Two vans down. One totaled. Two dealerships now short a van. A buyer short a van. Who's going to pay for what. etc etc etc.
I said that with missing fingers, the driver could have lost them thru diabetics. And he was having a sugar/insulin imbalance problem, causing the wrecks. Or could have been having mini-stokes. Not someone who should have been driving.
Most dealer trade drivers tend to be old retired guys who like to pick up some money on the side with their free time.... However, some are a pretty advanced age, and I'm sure all of us have had family or friends of that age who we know shouldn't be on the road. Like your story points out, it can be pretty dangerous. Lucky that it didn't involve any other drivers...
Thanks, bliss
They give quotes that don’t include “destination charge”, but they don’t tell you that. They sell life time of carwashes for like $800, and they are very high pressure about it. I have heard a story where a salesman stood behind customer’s car, so that they couldn’t leave the store. My sister bought a corolla from 355 Toyota. She got a great deal that no other dealer would touch, but I had to fight for it.
If you are inexperienced, watch out. They might give a great price up front, but they will get you on the backend (punt intended).
Although it's been 4 years, I still remember my visit to darcars in Silver Spring. I went there because a friend of mine bought a car there and got a great price. When we went there, we also got a great price, but I also remember being pressured by the salesman to buy some kind of extended maintenance package (??) for around $800. The insistence on buying this package distracted me from why I was there in the first place. I ultimately didn't buy the car. I think my wife liked another brand we looked at elsewhere earlier (it was to be her car anyway). I have to say the sales guy was nice though.
Having said that, I have another friend, an attorney, who always buys at darcars. He's always able to lock in on a low price. I won't go into the sordid details, but I guess, bottom line, he just wears them down. He knows how the retail car business operates, and he's very good at what he does.
I also have to admit that the SS location is one of THE MOST busy car places I've ever seen in my life. It would make McD's at lunch time look empty.
PS, If you want a really low key Toyo dealer with consistenly good prices, try Miller Toyota in Manassas. You'll have to pay a higher doc fee in VA, but you can always negotiate these things.
Good luck.
What I'm doing now is embracing the power of "no" and doing a lot of walking away. Remind the dealership that with 4600 miles, it's a used car - in fact, check the rules for your state; it may be illegal for them to sell the car as new with that milage. Point this out to them, if true. And make sure they've done at least one oil change.
Also, I don't know how other people drive on their test drives, but it's likely the engine hasn't been broken in the way a new car would. So that changes things as well.
Good luck.
If you plug in to the TMV, you can treat it like a used car, but enter the miles, the condition, etc., which for a demo will be better than for the typical "used" car, and come up with a price that will give you a ballpark figure. You should probably offer less than this now, since the 07's will be out pretty soon.
Before you walk away, are you making a specific offer?
I mean, are you saying something like, "I am offering $25K out-the-door for that there Jazzmobile over yonder. Do you accept my offer?"
Believe me, when you lay a specific amount of money on the table, it will get the dealer's attention. They are attracted to money.