11 Car Buying Hacks to Land You The Best Deal
Photo by Evgeny Tchebotarev on Unsplash
Buying a new car is both an exciting and overwhelming time. On top of figuring out the many vehicle choices, you also have to cope with car dealers and their sometimes stress-inducing tactics. We’ve put together an easy list of car buying hacks to consider when you begin your new car shopping adventure.
#1 Know Your Credit Score
If your car purchase will involve financing, it’s essential to know your credit score before you even begin looking for that new set of wheels. Finding out this information ahead of time will enable you to fix any errors before applying for a loan. You’ll also know what rates you may qualify for.
There are numerous online services, including no-cost options, that can provide your score. But, keep in mind auto lenders frequently use a modified credit score for determining your worthiness for a car loan or lease. This might be called a FICO auto or Vantage score.
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#2 Look For Leftover Models
If you’d rather save money than drive the absolute newest model, then consider looking for a leftover—it’s a great car buying hack. These are still new cars with a warranty but may have been replaced on the showroom floor with a fresher exterior model or all-new edition.
The same applies to the model year, too. For example, if the 2021 models are out, see if there are any remaining 2020 editions. Dealers need to sell these leftovers, and often the manufacturer may offer extra incentives.
#3 Avoid In-Demand Models
Dealers are unwilling to deal on the latest and greatest vehicle that the manufacturer just launched. Supplies will likely be limited, there won’t be any manufacturer rebates, and other customers will be clamoring for this hot car. Some dealers will even add a mark-up above window sticker price on super in-demand vehicles.
If possible, wait a few months as interest dies down and the factory chugs out more inventory. If you have to have a highly sought-after car, be sure to shop at several dealers.
#4 Shop For A Loan
This is an essential car buying hack. Before considering the dealer for financing, check with your existing bank or credit union. Current customers may be eligible for reduced rates or other programs. Also, check interest rates with online loan companies that shop your application among different lenders. Some online auto lenders can provide estimated loan terms without the inquiry affecting your credit score (this is called a “soft pull”).
Once you know available loan options and terms, you can then see what the dealer’s loan offerings look like. Importantly, be sure that all loan applications are submitted within a single, two-week period. Your credit score takes a slight hit with each loan request, but the credit agencies will only show one loan inquiry even when you‘ve applied to multiple lenders over these 14 days.
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#5 Use The Loan To Negotiate Better Dealer Pricing
Dealers will accept loans from an outside lender, but they want you to use their funding source because it generates more profit for them. A dealer will make hundreds or even thousands off of dollars of each loan it “sells.” And you can use this to your advantage.
Once you shopped around elsewhere for a loan, you know your best options. Ask the dealer to beat your best available financing offer. You can also ask for a lower price on the car if you agree to accept the dealer’s loan offer.
#6 Focus On Price, Not Payment
It’s easy to fall into a trap where you are only concerned about your monthly payment. Dealers can massage loan numbers that hide the interest rate and length of the loan. Instead, negotiate first on the bottom line price of the car. This could reflect freight, taxes, registration fees, and anything else the dealer tries to include.
Be sure to ask for a line-by-line detail of each item that adds to the car’s price. Once you know the bottom line, you can more confidently consider financing options.
#7 Shop Beyond Your Local Area
There could be several reasons why your local dealership may be unwilling to budge on pricing. Perhaps there is little competition in your area, the car you want is in short supply, or the dealer has already achieved its sales goal for the month.
Going to a dealer in the next town or state may save you big bucks and can be a very effective car buying hack. It never hurts to pick up the phone or send an email to check pricing elsewhere. At the very least, this approach can confirm if you’ve already received a good price. At most, you may have to travel to pick up your new car.
#8 Don’t Hesitate To Walk Away
Your most potent weapon is the ability to walk out of a dealership. Don’t like a salesperson’s attitude or think you’re not getting a good deal? Then head for the door. Shrewd dealer staff will attempt to control the process and may you feel like you have no other choice but to buy a car from them.
Don’t be reluctant to walk out even if you’ve spent hours at the dealership. It’s far better to start over with another dealer than to have years of regret over a bad deal.
#9 Keep Your Trade-In A Secret
Unscrupulous dealers can use your trade-in as another piece of their shell game. They may appear to offer an outstanding deal on a new car, when in fact, your trade-in is being way undervalued.
In the beginning, just say you won’t be trading in your car and focus only on negotiating the price of the new vehicle. Once that’s hashed out, you can always say you’ve changed your mind and want to know what your car is worth. This way, you’ll have accurate pricing for the new car and your trade-in.
#10 Say No To Add-Ons
Part of your transaction will include valid costs like the car itself, taxes, and licensing fees. Dealers love to add to your expenses by packing on processing and documentation charges as well as fees for handling things with the DMV. Also, be expected to receive a sales pitch for extras like paint and fabric protection or an extra tire warranty.
Question everything the dealer is trying to charge you for. Don’t assume you have to accept all of the extra costs and learn to say no.
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Buying a used or CPO luxury car is one of the smartest buys you can make - you can get a lot of car for not much money. You can pick up a three-year-old luxury car for about half of what you’d pay new. Check out this list of the best used luxury cars on the market to find the best deals.
#11 Consider Certified Pre-Owned
It’s terrific taking ownership of a brand-new car, but depreciation packs a wallop. The average new car will lose more than half of its value over the first five years. Add in those monthly payments, and you can almost feel the money pouring out of your wallet.
Savvy car buyers will check out the certified pre-owned (CPO) cars offered by most manufacturers. These are late-model, almost new vehicles that have already taken the depreciation hit and include warranty coverage.
Get a Curated List of the Best Used Cars Near You
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The best part? CoPilot is built using the same technology that dealerships use to buy and sell their inventories, so we have more info on each vehicle than competitors. CoPilot doesn’t work with dealerships, so there are no sponsored posts or other shady practices — just the most info on the best cars. Check out our About Us page to see how CoPilot works.
