Many car buyers are worried about negotiating car prices, preferring to buy their cars at the initial cost. However, you can save lots of money with the right haggling skills.
Take the unknown out of negotiating car prices. In this article, we’ll show you how to negotiate car prices down so you can get the best deal on your vehicle without any stress.
5 Tips for Negotiating a Car Price
Here are some tips to help you negotiate car prices, whether you’re buying used or new. Prepping beforehand with these tips will help you keep a level head and can score you your dream deal when negotiating for your next car.
1. Do Your Research
A new car is a significant investment — you wouldn’t buy a house without shopping around, so why would you buy a car without learning everything you can beforehand? Before setting foot in a dealership, you need to research everything you can.
Use online tools to compare car prices at different dealerships and read the dealership reviews to find the right spot to buy your car. If you know what kind of car you want, find out the manufacturer’s suggested retail price, the car’s fair market value and what extra features or similar models will cost. Additionally, you can get a price quote from a dealership online. Take this with you when you go to the dealership and ask them to price-match their business.
Look up everything you can, and don’t be afraid to bring notes with you to the dealership. The more knowledge you have, the better prepared you’ll be.
2. Be Flexible
While you might find your dream car during the car buying process, you should avoid being 100% set on one specific trim, model or feature. Getting only one car stuck in your head will make you less inclined to negotiate and find the best deal.
If you can’t get a car deal within your budget, you might go over budget just to get the car you wanted. Doing so can set you back long-term and might leave you worse off than if you got a slightly less expensive model that didn’t have everything you wanted.
Additionally, the day and time of year when you buy a car might lead to you getting a better deal. You should be open to waiting a bit before getting your car — it might come down in price, or the car dealership might run a special sale you’d miss out on if you were set on getting a car the day you first visit a dealer.
3. Get Preapproved
Get preapproved for an auto loan before visiting a dealer or seller. If you have a budget set beforehand with a loan, you’ll be better at keeping yourself in your price range.
Additionally, if a salesperson knows you already have a preapproved loan, they might offer you a financing deal with better terms. They might be willing to match or go lower if they know you’re getting a good deal elsewhere.
Just be sure you understand the terms of the loan before you agree to it later so that you make the best financial decision possible.
4. Ask for the Out-the-Door Price
When negotiating car prices, dealers might get you to sign by keeping the monthly payments within your budget. However, they might have you so focused on the monthly price that you don’t notice they’ve set you up for an extended loan. The monthly fee might be in your budget, but the total price could be much higher than you wanted for a car.
To avoid this situation, ask for the out-the-door price along with the monthly payment. This is the total price the dealer is willing to sell for, along with taxes and fees. Have them name this price so you don’t get caught up in monthly payments for a more expensive vehicle.
5. Be Ready to Walk Away
Salespeople might convince you to buy due to the “sunken cost fallacy.” If you’ve spent lots of time and effort trying to get this car, they might get you to buy it at a higher price simply because you’ve already invested so much energy into it.
Understand you can always say no and walk away from the deal. There will always be other cars and other days to negotiate better prices — avoid getting caught up in the pressure and say you’ll visit another time.
Negotiating Car Prices FAQ
If you still have questions, we’ve put together a list of answers to help you succeed in your car negotiations.
How Should You Negotiate for a Used Car vs. a New Car?
You’ll have more room to negotiate with used cars. Because they’ve likely seen some wear and tear, you can usually get the price down more than you can for newer cars. Additionally, you can ask for a lower price if parts of the vehicle need tune-ups or repairs to make it drive better after purchase.
How Much Should You Offer When Negotiating a Car Price?
When negotiating a car price, you first need to know what you’re willing to pay for the car. Once you have this figure, offer the dealer a price lower than the one you have in mind. This way, when they negotiate upward, you can meet them in the middle at the price you actually wanted to pay, and you won’t pay more than anticipated for the car.
How Do You Negotiate a Car Price When Paying Cash?
While paying cash might occasionally get you a better deal, it usually won’t do much to sweeten the pot. Dealers typically prefer to make money off of in-house financing, so coming in with cash instead of needing a dealership loan isn’t going to get you a lower price automatically. You’ll still need to negotiate a car price, even if you bring cash.
See if You’re Eligible for Auto Loan Refinancing
After negotiating with your dealer and securing your car, you’ll likely have to pay off a loan over several years. Refinancing your car is a great way to get reduced interest rates, lower payments and better loan terms. While refinancing is an excellent choice for any car owner looking to improve their lease terms and save money, shopping around for one can be time-consuming and stressful.
At RefiJet, we take all your refinancing application information and send it through several lending programs. Then, we compare rates and show you the best possible deal for your auto loan refinancing. You get the refinancing terms you deserve while leaving the hard part to us.
Wondering if you can refinance your auto loan? Contact us online to see your eligibility today!