5 Steps to getting the best deal:
These steps have worked for me for the last 15 years.
1) Do your research online!
- Leverage the common sites - Edmunds.com, TrueCar.com, Cars.com, and Forums to identify pricing and trade-values. I'd steer clear of KBB as that organization is tied to several dealerships as sponsors!
- Keep in mind almost all dealers are allotted credits. These come in the form of "Kick-backs that can be as high as 5-10%" plus dealer incentives that may or may not be propagated to the customer.
- Price out and read about the options you have interest in including financing deals available (interest rate and terms)
- Trade Value should be obtained from the black book prices offered through cars.com for instance. The dealer will use other means but stick to what #'s this tool gives you.
* Output: Know the vehicle, MSRP, Invoice, True Market Value, finance terms and trade value (if applicable)
2) Visit the dealership ONLINE sites within at least a 50 mile radius (start here!)
- This can be identified by going to the auto maker's main site. Leverage at least 2 or 3 dealerships so you can have a plan A, B, C
- Look for a vehicle that is actually ON a lot. They will want to move that vehicle! This also cuts out a large portion of the work.
- Submit the normal request for an e-price free quote online from their site. This initiates the dealer(s) of your interest on the EXACT car! They will most likely not reply with a price but rather a means of contacting them. This is ok.
- I like to look at the "TrueCar" histogram view for different regions that show the 1 or 2 folks that got the biggest discount. This is usually 10-14% off of MSRP and gives you a target.
- Don't respond back to the dealer until you would be willing to pull the trigger at your price! Use that as leverage!
3) Wait until the end of the month (last business day). Most dealers have quota's to meet for dealership and individuals. They will be eager to get to the bottom line quickly to make the deal when they know you are willing to put a deposit down for the price w or w/o trade deal you are looking for.
4) Contact your target dealerships via a phone call or email with a $ value associated to the stock # of the vehicle. Keep driving the point home that you are serious about doing a deal today and offer a deposit via credit card. Also inform them of financing if needed with the rate and term you want.
- The $value should = 10% - 12% of MSRP + known program discounts or rebates. This must be stated as OTD (Out the Door) so they don't slap fees on after the deal is confirmed. Keep enforcing the term OTD! Invoice is normally about to 8% offer MSRP.
- If they get close to your # then counter by having them throw something in such as free window tinting and/or accessories you were going to buy anyway. That may seal the deal if you need to come up a bit. This is a counter that is easy to stomach for them.
- Stay firm on the financial terms as well % and term.
- Hold your ground as it may take until the end of the day for them to call back. You have limited the wait time already by doing it at the end of the month and knowing the vehicle you want. Tell them to think about and call you back so you can move on to the next dealership call. Don't sit on the phone waiting ever!
- They will tell you they'll lose money selling it for under invoice (the price they paid). Wrong! Remind them of their dealer incentives and kick-backs and you have done your research and know the fair market value for the vehicle. No reason to offer them anymore info than that. Enforce the point that you will give them a deposit on the spot and come down to the dealership to do the transaction today! That will cut to the chase quickly. Also inform them you are willing to move on to the next dealership if necessary.
- Do NOT go to the target dealership until the financial agreement is in place! Have them read it back to you and send via email so you can take it with you. They will want that deposit by this time.
- Once you have agreed to a purchase price and finance terms/%, introduce a trade if applicable. Refer to your #'s and offer that any deal is contingent on them seeing your vehicle and your evaluating theirs. Tell them about the trade and get them to commit to a trade value you are comfortable with on the contingency of them seeing it. They want you on their lot so they will make an offer sight unseen that favors you.
- Run your financial #s with any online loan calculator and know what your payment will be.
- Agree to what you are comfortable with and offer them a deposit on your card! This will tell them you are a serious buyer.
5) Once the pricing, trade and financials are understood you may visit the dealership that wins your business. You should at least being working 2 dealerships or more so you have your plan B and C.
- Note: The stipulations on evaluation and trade still are contingent. Don't worry about it. It gives both an out if needed or if someone wasn't forthright up front. it also allows you flexibility. Be honest about your trade though.
---------------------------
It's really not that hard. You are doing all the heavy lifting up front and on the couch in your own house! If you want, go visit a dealership as a non-interested party just to browse if you need more visual touch and feel confidence.
Stay patient and let them call you back. Be willing to walk away and wait another month! Don't let them see you are too excited or anxious to get that specific vehicle!
These steps have worked for me for the last 15 years.
1) Do your research online!
- Leverage the common sites - Edmunds.com, TrueCar.com, Cars.com, and Forums to identify pricing and trade-values. I'd steer clear of KBB as that organization is tied to several dealerships as sponsors!
- Keep in mind almost all dealers are allotted credits. These come in the form of "Kick-backs that can be as high as 5-10%" plus dealer incentives that may or may not be propagated to the customer.
- Price out and read about the options you have interest in including financing deals available (interest rate and terms)
- Trade Value should be obtained from the black book prices offered through cars.com for instance. The dealer will use other means but stick to what #'s this tool gives you.
* Output: Know the vehicle, MSRP, Invoice, True Market Value, finance terms and trade value (if applicable)
2) Visit the dealership ONLINE sites within at least a 50 mile radius (start here!)
- This can be identified by going to the auto maker's main site. Leverage at least 2 or 3 dealerships so you can have a plan A, B, C
- Look for a vehicle that is actually ON a lot. They will want to move that vehicle! This also cuts out a large portion of the work.
- Submit the normal request for an e-price free quote online from their site. This initiates the dealer(s) of your interest on the EXACT car! They will most likely not reply with a price but rather a means of contacting them. This is ok.
- I like to look at the "TrueCar" histogram view for different regions that show the 1 or 2 folks that got the biggest discount. This is usually 10-14% off of MSRP and gives you a target.
- Don't respond back to the dealer until you would be willing to pull the trigger at your price! Use that as leverage!
3) Wait until the end of the month (last business day). Most dealers have quota's to meet for dealership and individuals. They will be eager to get to the bottom line quickly to make the deal when they know you are willing to put a deposit down for the price w or w/o trade deal you are looking for.
4) Contact your target dealerships via a phone call or email with a $ value associated to the stock # of the vehicle. Keep driving the point home that you are serious about doing a deal today and offer a deposit via credit card. Also inform them of financing if needed with the rate and term you want.
- The $value should = 10% - 12% of MSRP + known program discounts or rebates. This must be stated as OTD (Out the Door) so they don't slap fees on after the deal is confirmed. Keep enforcing the term OTD! Invoice is normally about to 8% offer MSRP.
- If they get close to your # then counter by having them throw something in such as free window tinting and/or accessories you were going to buy anyway. That may seal the deal if you need to come up a bit. This is a counter that is easy to stomach for them.
- Stay firm on the financial terms as well % and term.
- Hold your ground as it may take until the end of the day for them to call back. You have limited the wait time already by doing it at the end of the month and knowing the vehicle you want. Tell them to think about and call you back so you can move on to the next dealership call. Don't sit on the phone waiting ever!
- They will tell you they'll lose money selling it for under invoice (the price they paid). Wrong! Remind them of their dealer incentives and kick-backs and you have done your research and know the fair market value for the vehicle. No reason to offer them anymore info than that. Enforce the point that you will give them a deposit on the spot and come down to the dealership to do the transaction today! That will cut to the chase quickly. Also inform them you are willing to move on to the next dealership if necessary.
- Do NOT go to the target dealership until the financial agreement is in place! Have them read it back to you and send via email so you can take it with you. They will want that deposit by this time.
- Once you have agreed to a purchase price and finance terms/%, introduce a trade if applicable. Refer to your #'s and offer that any deal is contingent on them seeing your vehicle and your evaluating theirs. Tell them about the trade and get them to commit to a trade value you are comfortable with on the contingency of them seeing it. They want you on their lot so they will make an offer sight unseen that favors you.
- Run your financial #s with any online loan calculator and know what your payment will be.
- Agree to what you are comfortable with and offer them a deposit on your card! This will tell them you are a serious buyer.
5) Once the pricing, trade and financials are understood you may visit the dealership that wins your business. You should at least being working 2 dealerships or more so you have your plan B and C.
- Note: The stipulations on evaluation and trade still are contingent. Don't worry about it. It gives both an out if needed or if someone wasn't forthright up front. it also allows you flexibility. Be honest about your trade though.
---------------------------
It's really not that hard. You are doing all the heavy lifting up front and on the couch in your own house! If you want, go visit a dealership as a non-interested party just to browse if you need more visual touch and feel confidence.
Stay patient and let them call you back. Be willing to walk away and wait another month! Don't let them see you are too excited or anxious to get that specific vehicle!