How to Negotiate a Car Deal (And Save Big) - YouTube

car-buying will always suck because every time you buy a car you'll never

have a clue if you got the best deal or if you didn't there's really no way to

know how much money a dealer's making off of you every time you buy a car but

in this video I'm gonna cover the three key steps to negotiating a car deal so

that you can at least get the best deal possible so if you follow these steps in

order you'll at least be more prepared to negotiate a car the next time you

need to and you might just learn something as well now if you just

stumbled across this video I'm Jason with the honest finance Channel I like

to talk a lot about different financial subjects so if you're interested in this

type of content feel free to subscribe or at least give the video a like and

now on to car buying negotiation now the first key step in order to properly

negotiate a car deal is research what I'm saying here is that you have to do

your homework on the type of car you're looking for before you even bother going

to the dealership just think of it like this okay the goal of the dealership is

to make money and your goal is to save money so in order to do that you've got

to start by doing your research I mean seriously how do you expect to negotiate

a car deal if you have no idea what the car you're looking at is even worth just

don't be stupid with this okay just do your homework and you'll be just fine

so while you're doing the research for the car that you're looking for these

are the two websites that I recommend using I want you to visit Edmunds.com

and truecar.com because both of these websites are gonna give you really good

information on what your car is worth the specs and different reviews and

things like that they both do a great job at letting you

know how much your car is worth in the particular region that you live in what

these websites do is they allow you to plug in all the different specs and

information about the cars you're looking for and then they'll tell you

what's a fair price that you should be paying now you can use Kelley Blue Book

as well but what I'm trying to say here is that if you just go online and do

some research you're gonna be in a lot better position to negotiate a car and

seriously if you don't do your research you're gonna end up in a car that you

didn't want in the first place and you're gonna want to sell it in six

months because you hate it so just do your research before you go to the

dealership and you'll be just fine now the next key step is to actually

negotiate the price of the car that you're buying I'm gonna tell you exactly

how to negotiate car deal so the first thing you want to

do is you want to get on the phone and you want to call every single dealer

that's in your area and find out what they want for the specific car that

you're looking for now if they do want their business they'll just tell you the

real numbers over the phone so that you don't have to play a bunch of games and

you can just go into the right dealership that you want to now if they

tell you that you have to come into the dealership in order to get the price

then don't even bother doing business with them because they're not giving you

the respect that you deserve right from the beginning

now once you've made all the phone calls and you're confident which dealership

you want to go with go ahead and head over that now once you've gotten to the

dealership and you find this specific car that you want you need to lock in

that price first thing and I'm talking about the exact price of the car and not

the monthly payment because monthly payments can fluctuate just based on

changing the terms so let's say that the car you're looking for is listed for

fourteen nine and that's a pretty good price based on the research that you've

already done now you've already got a good starting point because of the phone

calls and the research that you've done but you don't know how much the

dealerships paid for it maybe they only paid thirteen five for the car but you

have no idea now if that were actually true they could potentially make about

fourteen hundred bucks off of that deal and that's not even including a trade-in

or financing different things like that and I know that businesses need to make

a profit in order to stay in business but there's a point where they're just

making too much money off of one deal and seriously 1,400 bucks isn't even

that much compared to some of the really expensive used cars and the margins that

they haven't knows now that's the thing that really sucks about buying cars

these days is because you have no idea how much money they're making in the

deal there's no transparency when it comes to buying cars from the consumers

point of view so what you can do is you can at least try your best to negotiate

the best deal possible so that you don't have to think about it now this is how

you negotiate the car's price but you've got to be confident in order to make

this happen now if you've got a timid type personality then you've got to

understand that you are always gonna get screwed on these kind of deals unless

you fake your confidence so I don't really care if you're not naturally the

confident type you've just got to fake it in order to make this happen so this

is what you've got to do you've got to start with an asking price that's fair

and realistic for the amount of money that you actually want to pay for the

car so for instance let's say that you lowball and you ask for $9,000 for the

car well the salesman is just gonna politely

walk you out of the dealership and say have a good day because that's not fair

and that's not a realistic price the dealership does have bills to pay and

the salesman probably wants to keep his job so just make a realistic and a fair

offer here if it were me personally I would offer $13,900 for the car and I would

stand by that price and the only thing that sucks here is that you have no idea

how much money they're making on that car but just be confident in your offer

and you'll be just fine and you won't have buyer's remorse and you can be

confident here because you at least know based on your research that the car is

worth a little bit more than that you just don't know how much the dealership

is gonna make off the deal so just be ok with the number that you got from the

research and the offer that you're making on the car so that you can be

confident so right after you make the offer the salesman will say something

like well let me go talk to my manager that's a really low offer we'll see what

we can do now he's gonna come back with a pen and paper and he's gonna write

down a bunch of financing and a bunch of numbers and all sorts of stuff like that

but the only thing you need to pay attention to is the actual price of the

car and my bet is that the number on the car is going to be $14,500 which

is not the $13,900 that you asked for he'll still make you feel bad that the

company's not making any money and that that's about the maximum amount

of money that they can sell the car to you for and if it were actually true

that they weren't making any money on the car and at this point they would

just walk you out of the dealership and they'd say have a nice day because they

really do need to make a profit on the car so just keep in mind that if they're

not kicking you out of the dealership then you're still worth their time to

them so from my personal experience I was in sales for five years and I can

tell you that there is always a point in a negotiation where it's still worth

getting the sale there's always going to be a point where the salesman can either

make it happen or he's got to have you leave so even if the salesman's

Commission has been completely slaughtered by your offer it still might

be worth it to them because of monthly sales and yearly sales that they're

trying to keep track of so at this point just ignore all the numbers on the paper

and focus in on the price tell the salesman that you can't afford anything

but the $13,900 that you offered and that you'll just leave if they can't

do that for you now at this point he'll go back to the manager once again

and then he'll come back with a new number this time it'll be $14,200 and he

will tell you straight up that they have no money to be made on that car

so now just be confident here and offer once again the $13,900 and just tell him

that you'll leave and seriously don't feel bad if you need to leave here

because it's really easy to just go to one of those other dealerships that you

already called and work with them instead so now the salesman will leave

to his manager once again and this time the manager will come back with the

salesman now if they can't afford your offer you'll know that by now but at

this point you're going to be talking to the salesman and the manager now when

you're talking to them they're gonna give you a whole bunch of bullcrap about

how they're not making any money and how fourteen thousand dollars is the lowest

they could possibly go on the car now I'd say fourteen thousand dollars is

close enough to the thirty-nine that you offered so just say yes and make it

happen the thing that sucks here is that if they would have just offered fourteen

thousand from the very beginning you probably would have been just fine with

that and you wouldn't have had to waste any time but that's part of the

negotiation process because if you don't go back and forth a few times then

they're likely to make more money off of the deal and then obviously you on the

other hand are gonna be spending more money on the car I'd say that going back

and forth about three times is usually the magic number and I'm sorry that this

sucks but you're gonna have to do it every single time you buy a car in order

to get the best deal now I'm not gonna go into a ton of detail here but if

you've got a trade-in you're gonna have to do the same stupid game once again

you've got to make sure that you get an excellent trade price too otherwise

you're just gonna end up breaking even so basically if you get a really good

price on your car but you've got a really crappy trade-in then that's not

gonna work overall you've got to get your trade up here where it's even so

that you get the best deal overall now I do want to make a point here that if

you've got a trade-in for the dealership keep in mind that most states will

actually subtract the total of your trade amount from the total price of the

car helping you with the sales tax so let's say that you buy a twenty five

thousand dollar car and you have a trade-in that's worth $12,000 so let's

pretend that the sales tax rate in your state is about seven percent so what

this means is that you're only gonna pay sales tax on the difference which is

thirteen thousand dollars instead of the twenty five thousand dollars that you

started at so if you've got a car that you want to sell that's actually worth a

lot of then it might be worth considering going

through the trade through the dealership so let's say that you have a car that's

worth like $5,000 and the dealership only offers you $3,000 for the car well

even with the tax advantage it's not gonna be worth that extra $2,000

so you'd be better off just selling it on your own and whether or not you want

to sell your car on your own or do a trade through the dealership that's just

up to you I've done plenty of trades and they've worked out fine

now that you've negotiated the price of the car and the trade-in it's time for

the final key step of negotiation which is the financing now this part of the

negotiation process can really screw you over so pay attention as to what to do

when it comes to financing the first thing you want to do is you want to make

sure you get the best interest rate for the car loan that you're trying to get a

lot of dealers will actually get a tiny little cut of the interest rates so it

might be in your best interest to check with your banks before you go into the

dealership to check their rates but I've actually found that a lot of the big

dealerships are pretty honest when it comes to competitive rates so what you

see at a bank is going to be exactly the same as what they're offering you just

do a little bit of homework here so that you have an idea if they're getting a

cut or if they're not getting a cut so once you've got the interest rate

figured out you've got to also understand that you've still got taxes

and fees associated with your car as well

now taxes and fees totally suck when it comes to buying a car but I'm gonna

teach you how to tell if it's a tax or if it's just a bullcrap fee for the

dealership to make more money the way that you can tell that it's a legit feed

that you have to pay is if you don't pay sales tax on the fee you're not gonna

have to pay sales tax on a state registration or a licensing fee or

anything like that and if you do have to pay sales tax on the fee then that's a

good reminder that it's probably a fee that you don't have to pay there's a

couple fees that I've always gotten used to and one is called VTR and the other

one is called the doc fee now VTR which they call vehicle theft registration is

usually about 300 bucks and I've always been able to get out of that one now the

other feed that I'm used to is called the doc fee which is also about 300

bucks but I have never been able to get out of the document fee so if you have

let me know in the comments because I've tried really hard and I've never been

able to get out of it now at this point during the financing you want to make

sure that you get all the applicable rebates and all the different things

associated with saving money on the vehicle

now if the dealership offers you an extended warranty or some sort of an

interior cleaning protection program keep in mind that those are negotiable -

I'm not gonna go into a bunch of detail here but just don't pay full price for

an extended warranty if you want something like that and don't pay full

price for some carpet cleaning thing either now finally after all of this is

done you can sign the paperwork and you can drive away knowing that you

negotiated the car the best that you possibly could and now you don't have to

have buyer's remorse like most of us do after we buy a car now once again I'm

Jason with the honest finance Channel if you did find this video helpful feel

free to subscribe to my channel or at least give this video a like that's all