?'s for those who buy cars often!

I always seem to get screwed when I put money down on a car. Or try to get screwed when I have tried to trade a car in. I will be replacing my Mazda 3 in the next couple of months as I will likely have to do this once a year depending on my miles I drive for work. So for those who purchase cars often, or those who sell or have sold cars for a dealer. What are the tricks of the trade? Or rather how do I keep from getting screwed and end up with a fair deal. For example, if I go in and we talk price on the car to purchase...and I get a decent price. Then I say I'd like to put say $2000 down, why is I end up spending more then what the price of the car was? It's like all of a sudden all these charges come up on the invoice...fee's for this or that. So what is the best way to avoid this? Also is it better to sell my car outright instead of trading it in? Especially if there is a lien on it still.
Thanks in advance, I'm sure these q&a's could help out others as well.:up:

 

Get your car detailed before taking it in. cost you $200 bucks but will greatly increase what they are willing to give you for your car.

Also when you get a new car put the mats in the truck in a garbage bag and by some aftermarket ones so when you go to trade them in they still look new.

Same with a steering wheel cover.

When talking about the price talk "out the door" with the salesman

 

The biggest loss I've taken financially will be when I sell this VW passat. I bought it just over a year ago for around 17 and now will be lucky to get 12 out of it (and that doesn't include the financing). I FINALLY realized, there's nothing worse than putting good money into a new car or even a decent car. So to keep miles from building on the passat, I went out and got a 1984 ford ranger. Turned out (so far) to be one of the best decisions I've made. I paid $600 for the truck, and love it to death. Yes, it's got a hundred things wrong with it, but it's gotten me from point a to point b without any problems for the last 4000+ miles. It can also haul my racing stuff around :up:

In the end, I'm still dumping $375 into a passat each month, have 3+ years in payments left, and never drive the thing to keep the miles down so I can get rid of it. Meanwhile, my truck is 100% paid for, used far more often, more versatile , just as reliable, and not to mention, easier to work on than the newer cars. My advice...find a nicely maintained "clunker", and put the $400/month you save into other things...like a vacation, or retirement.

I did a little calculation the other day. If I'd never gotten the passat, and just got the truck, and put the $375/month I'm throwing away on car payments into the stock market, I'd retire a wealthy man. If the average life of a car is 5 years, I would have had $34284.83. Assume even 5k in repairs for the "clunker", and it drops to $29,284.83. Still, if you leave that alone for 20 years, even W/O the $375/month add in, that 29k balloons to 401k when you retire.

I'll probably never own a decent car again, and am pround not to :up: (at least, I'm proud till it breaks down on me )

 

Get your financing arranged before you go to the dealership, don't let them do it for you. Otherwise, you could find that even though you got the price you wanted for the new car the payment that they give you doesn't add up. The reason is because the banks pay the dealerships a fraction of percent for arranging the loan. This gets added to the amount that you're financing, meaning you pay it, not the bank.

 

Only problem with your theory for ME anyway. Is I travel for work so I need something dependable and with a warranty so incase something does happen I can be back on the road at no expense to me. If I had a old clunker which I did prior to my Mazda...I made a killing on the mileage money I got back, but the trans took a crap now it sits in my driveway. Luckily it happened close to home and not 400 miles away. Trust me, if I worked here locally I wouldn't be buying a newer car every year. 4000 miles...I can do that in a couple of months. I bought my Mazda last Oct. (25th I think) with 32k, it now has 61k and I haven't had it a year yet.

See this is the good info everyone should and needs to know. :up: Thanks for the input.

 

You just need a car that's been properly maintained. I have had a lot more trouble out of my newer passat than I've actually had out of my old clunker. It's a crap shoot really, unless you go out an blow a ton of money on a new car, in which case, you'll be throwing away thousands in depreciation that could have been used on a repair or two.

 

You can get an almost new car for thousands less. My current car, an '05 Pacifica had less than 9000 miles on it when I bought it in December 2005. Cost out the door was several thousand less than what a brand new one would have cost and still had the warranty.

 

Yeah it's a hit and miss trying to find a good used car that was properly maintained. I don't buy new cars...can't afford that LMAO...but I also won't buy new because I'd rather someone else pay the depreciation, and have all the new car problems. I like to find them with 30k miles on them, because by then anything that was probably going to happen, already has. (usually) At the miles I drive, I mean I'm already 10k over what should be on my Mazda so that is why I want to sell it soon, luckily I got a good deal on it as it was listed on the website wrong...about $3k wrong. I also put down $2k. But even with that I'm going to just get back my $2k if I sell it outright. So the good deal that I got getting it cheaper really didn't help any for some reason. Course the $3k make up was dealing with dealership mark up too. This car is fine, but is out of warranty and only had a 50k warranty. Probably the last Mazda I'll own, not only because of a short warranty, but gas mileage is poor for being a 4cyl. I will likely get a Nissan next...either an Altima or Maxima. Nissan motors are pretty damn good. That 3.5l has been around a good while an always wins the awards.

 

What about leasing if you are getting a new car every year.

 

if your mazda warranty is too short at 50k, you're not gonna like the the 36k on the nissan.

sounds like you're in a lease now, you just didnt purchase enough miles. if you're gonna drive a lot of miles, and need a new vehicle often, i'd suggest you keep leasing and buy enough miles so you're not paying a penalty at lease end. buying/leasing/purchasing a car is an expense. you need to look at the overall picture and try to minimize your overall expense.

 

I just bought my wife, actually she pays the payments , but we got a 05 Nissan Quest had 34k on it but we were able to buy a 100k extended warranty that will replace anything on the van including the electronics...tv's, dvd, heated this or that. I only paid $1750 for the extended warranty, and I thought it was worth it. I don't lease vehicles...never have, likely never will. We drive a lot as most of our family is either up North or in Florida, and with my work I already stated I drive a lot there.

 

Look into a Sprinter. It's diesel so it should last a long time. Even used they seem to bring top dollar. Fuel economy is reasonable and you can haul your race stuff.

 

If you drive for your work, and put on so many miles that you need a different car every year, you need to be leasing. Look into it.

 

I dunno about everybody else, but me:

1) buy a used car (even a year old). stay away from dealers, if for no other reason that their employees have to eat too, so if you buy from a dealer you're going to pay more than private party.

2) don't trade in a car. sell it outright.

3) if you do go to a dealer, don't let them finance it. get your financing from a bank prior.

4) if you don't do #3, don't talk 'payments' with the salesman, talk percentage rate and months, and make sure it's as good or better than the bank terms. the dealer is going to finance it through a bank anyway (like a mortgage broker), so whatever rate they get quoted from the bank, they're going to add on a bit, when they quote a rate to you, and get a kickback from the bank (or at least they'll try). on the other hand, I had a dealer quote me terms the same as the lowest bank terms once, so in that instance, why not let them keep the vig (assuming no fees, etc.)? won't hurt to ask.

5) talk only final price with the salesman. don't let him get you into monthly payments, etc. get the "how much will I pay TOTAL in cash to leave with this car" amount.

6) if the salesman there doesn't do financing and you want to finance with them, settle on a price first, then deal with financing. (these are all sorta related, I guess, but still.)

7) don't buy that day unless you totally get what you want. better yet, test drive them all, then leave and fax/email all dealers within xxx radius that you want x car with y options, and either: a) you'll pay $z, or b) what's the best they can do? and don't negotiate from the salescube. leave and do it via email/phone/fax. why sweat in the dealership and wait on them?

8) put money down and get a payment big enough so that you'll never owe more than the car is worth, unless you know in your soul you're keeping the thing forever. and even then don't do it.

9) deal with a private party and a bank. cheaper. (and bears repeating.)

 

edmunds.com has some valuable information. Check out their whole website and definately read through the "Tips and Advice"

 

I spent a couple of years back in the day selling and leasing cars. First thing to remember is this: the dealer *always* wins. Everybody brags about how they took the dealer to the cleaners, but it just doesn't happen. In fact, generally the more somebody bragged about what a great deal they chiseled out of the dealer, the more they actually got "grossed." Almost a perfect inverse relationship.

Best way to avoid? Don't buy a car from a dealer! Seriously, the car business is one of the most cut-throat, competitive, and unethical businesses I've ever been associated with. It's unbelievable the amount of shady crap that goes on in that industry (remember when NASCAR titan and car dealer Rick Hendrick got busted for Fraud a few years back?)

If you must buy from a dealer, the best way is to sell your trade on your own. The dealer is going to offer as little as possible, generally well below the "trade-in value" you find in NADA and KBB. Plus, a trade just adds a variable to the deal that makes it more difficult to what you're actually getting for your trade and what you're actually paying for the new car.) The problem is most people are "upside down" on their trades, which means they end up buying another car from a dealer who can "pay off their trade" by rolling the negative equity from their old car into the new one, which just puts you farther behind the 8-ball.

Sell your car on your own. Arrange your won financing. It's not impossible to get good rates through a dealer, but you're going to have to work for it. The F&I office is a whole different profit center than New Car or Used Car Sales. And in most cases, the the F&I office grosses much more profit per unit than the Sales department does. They do that by marking up the interest on the loan (they get net rates from lenders, and mark the rate up from there), selling extended warranties (incredible mark-up -- sometimes as much as 1000%), credit life and disability insurance (another huge cash cow), rustproofing, etc. Even with your own financing, they're still going to lock you in the F&I office and let the guy/gal behind the desk beat you up for all the other add-ons.

Driving a new car is great. Buying new cars is perhaps the worst financial action you can take (okay, besides racing motorcycles ), particularly when you finance it. I disagree with your accessment that you *must* drive a new car. You can buy a low-mile, two-year-old car for 30 to 50% less than new. Many still have factory warranty left. Buy a car with a excellent reliability rating from an unbiased source like Consumer Reports (virtually any Honda or Toyota qualifies), and the odds against any sort of major mechanical problems are very slight. Save up $500 - $1,000 in an emergency fund (which shouldn't be hard as you're not paying new car payments) and you've got your own warranty fund.

I generally buy two-year-old vehicles and drive them well into the 100k range. I drive to client sites in a five-state area and have no hesitation jumping in my car, which has about 120,000 miles, and heading out for a 500-mile trip. Most cars built in the past decade are incredibly reliable, and can easily live 200k with routine maintenance. Mechanical problems tend to be small things (window motors, etc.) rather than major powertrain issues that leave you stranded.

 

This is irrelevant to your post but may help others...

I work with a guy straight from Vietnam. He buys used Toyota's,
he says usually he gets a Camry for about $4000 cash; drives them until they stop and he says he doesn't do regular maintenance(!)

Edit: I think he's got like 120,000 miles on this one...not even broken in yet. My 2000 Tundra has 130K, I'll drive that another
10 years no sweat. Used cars are the value in the market today. Just check all fluids and I mean all before you buy.

Point being, his philosophy has really changed my thoughts on finances.
Except for a house, if I can't pay cash, I don't buy it!

I encourage others to try make a game out of it. Try and get in a position
to save 1/2 or better of your net paycheck!.

 

I buy and sell cars on the side a little for extra money. I think the best bang for your buck is to spend around 7-8K and get the newest 4 cylinder Accord or Camry you can find. Skip all the fancy features, all you need is AC and maybe cruise. Don’t be afraid of something with 80-100K miles, they will run to 250K easily. Pay off as early as possible and drop full coverage insurance immediately unless you are getting a good deal on insurance. Oh, rule of thumb: never trade your car into a dealership, you’ll lose your ass. Try and buy from a private party if you can, you’ll skip all those BS fees dealers tack on.

I may be off, but I think $7-8K will buy you an early 2001-2002 base Accord/Camry with possibly less than 100K miles. Check craigslist DAILY for incredible deals. Be prepared to jump on them asap, they won’t last long.

 

Fitzmall is a dealer in Montgomery County, MD. Their location may not help you, but their prices should give you a good reference of how much a new car can be sold for. They do sell Nissan.

http://www.fitzmall.com/index.asp

Using them as a reference, I ended up getting my WRX for $400 under dealer invoice (2k under MSRP). Dealer still made money, which is fine, and I did ok. Oh, and I never, ever pay for dealer extras. I tell them that I don't want pinstripes, wheel locks, or whatever, and I have no intention of paying for them.

If I didn't specifically want a new car, I'd definitely look at cars that were returned after lease period. Great deals.

Good luck.

thane