How to Save Money on Car at Car Dealership
Buying a car is a significant decision, especially on your finances. If you are thinking of buying a new or used car, you will have to reach deeper into your pocket and consider its impact on your future financial standing. Based on the latest report, there’s an 8.4% increase in the market value of new cars and around 7% for the used car. There are different reasons for the uptick in the car cost. In this article, we will teach you how to save money on car, not just on the price of the vehicle but also on the insurance and ownership.
Tips To Save Money on Car at Car Dealership
We’ve heard many tactics and techniques that will help you bring down the cost of the total ownership of the car. If you plan to leave the dealership with more money in your hand, follow the tips we will mention below.
Arm Yourself with Knowledge
To help you save money on car, be sure that you are already of the makes and models you can afford before you even walk inside the car dealership. Whether you are trading, leasing, or looking for a replacement or upgrade, your knowledge will serve as your shield against the tricky side of this business. It does not only include the car’s actual price; consider the upgrades, tags, and tax; all these numbers are necessary to help you negotiate with the car dealer.
You should also guarantee that the dealer will know that you are familiar with the terms and numbers. It will send a message to them that you mean businesss and informs them that you did your homework and that you know the things that you are doing. It will help you change your game strategy and alter how you approach the game. Many dealers would not take you seriously if you came unprepared.
Loan Rate, Loan Length
The vehicle is a huge investment; it is only fitting that you understand some ways to save money on car. Some of us will choose to work with the dealership’s loan department. They will then bombard us with numerous questions that will help them understand what we can afford and the monthly payment we can handle. We want to ensure that the car dealership can provide us with the most competitive and fair rate.
However, it also means that it comes with a shorter loan length. We often advise car shoppers to look for a financing option elsewhere first, but if you are still adamant about applying for the car loan of the dealer, then it is best to focus on the loan rate first. It only involves a simple math equation to determine this; choose the lowest interest rate. It ensures that the extra cash is going to the principal, not the payment interest.
Negotiate
Remember that the ball is on your side of the court during the negotiation phase, especially if you did the proper research. Some dealerships will try to ‘steal’ the ball by giving you options and add-ons that you don’t necessarily need. Most of the time, it is only a way for them to increase the cost of car ownership. However, if you genuinely want this, such as the new car mat, carpet, or VIN etching (which I don’t understand why), be sure to negotiate them.
Typically, the cost will be astronomical when you compare it to the average price in the market. They will add various vague fees such as installation charges and service fees. To save money on car, be sure that you can bring down the price. You need to show them an uncaring demeanor; you won’t necessarily die if you don’t get this at the price you want. Let them tell you what they can do for you; you can always walk away if they can’t offer something. They aren’t your only option. There is always an available car mat or carpet in the aftermarket without the insane cost.
Avoid the Extended Warranty
Some people may find the extended warranty worthy, but mostly, you don’t really need it. Learning how to save money on car at a dealership requires understanding what can or can’t increase the market value of your vehicle. If you are acquiring the financing option at the dealership, it is customary for them to ask you if you plan to get a warranty. So, let us analyze what ‘warranty’ they are offering. You need to understand that the dealership is not offering this because they what you to avoid any unforeseen expenses and that you are adequately covered. They want to ensure that they are making a huge profit from this transaction.
If you purchase a new car, you don’t necessarily need a warranty. It is uncommon to encounter something falling apart on the more recent vehicle. Most of the time, the warranty will be untouched. Moreover, the standard warranty of today will not cover you for everything. You will have to shoulder the cost of traditional maintenance procedures, such as alignments, oil changes, flushes, etc. It’s pretty funny since those are all the things you will mostly need during your first years of owning a car.
Moreover, the parts and mechanics of your car come with a manufacturer warranty. For instance, if there is a severe problem with the batter six months after you purchase it, you will be protected with the battery warranty. Avoiding the extended warranty is one of the tips to save money on car.
Stay Away from the New Car
Some people will choose to buy a brand new car since it showcases their status in life; it is not really for convenience. There are several reasons why we won’t recommend a new car. For one, it can be pretty tiring to hear the dealer saying that you are lucky to get this car at an affordable rate, when in fact, it’s not. It is also challenging to stay on top of the negotiation; they will not forget to remind you that we are dealing with something new. It is also difficult to save money on car. According to the study, most cars will lose 70% of their market value when you drive off the dealership’s car lot. The fact that you are paying a premium price for something that will depreciate immediately is just disheartening. It will then continue to decline as the year passes by.
You probably think that it feels great to have something new. However, this will soon pass. After only a couple of days of showing off to your friends and relatives, it doesn’t appear to be a treat; it feels more standard. You will then realize that you could’ve enjoyed the same quality and convenience and save money on car if you chose a used vehicle.
Understand the Game
Car dealers will think of the whole transaction as a game. They’ve been doing this for years; someone who will do this for a couple of days or weeks could only wish that you would outsmart dealers in this game. If you don’t understand the game they play, you can end up paying higher than you should. One of the best ways to save money on car is to stick to the game. They will tell you that there’s nothing else they can offer, but keep negotiating.
Try adding something new to the negotiation every time and make sure that you enjoy an extra discount from the original cost. We can’t give you the exact duration of the negotiation but do not accept their first, second, or even third offer. It doesn’t matter if they find you a nuisance. Remember that you need to take advantage of the negotiation period. After you sign the contract, there’s no way to back out of the agreement. Remember that the dealership will still save money regardless of whether you are picky or hard to negotiate.
Avoid Buying During Your First Visit
Most of us are in a rush to get our hands on those lovely wheels. However, it is unwise to purchase a car during your first appointment with the car dealership. Your first visit should involve the initial consultation process. You will tell the dealer about what you need, and they will make a recommendation. If the car is available, you will take it for a test drive. They will make an offer, and the best response is to leave, but do it politely. Understanding how to save money on car requires you to look for your other options.
There’s a chance that a local dealership nearby is ready to offer this at a lower price. Reach out to them and repeat the initial process. Both of them will likely keep in touch and tell them how the other dealership is offering the same car at a better price. Most possibly, the first dealer will provide their vehicle at a much discounted rate. However, you should not immediately sign the agreement. Follow our negotiation tips above, and you can guarantee that you will save a lot.
Reading the Fine Print
It is best to read everything on the advertisement, loan contract, and agreement when buying a car. If you need to use a magnifying glass to peruse the inconspicuous text written at the farthest corner of the paper, do it. It will ensure that you will not be subjected to penalties or shady deals. The dealer will often advertise that they offer the car at a much-discounted rate. However, if you look at the terms and conditions, there are things that you need to acquire or accomplish before you could qualify on that particular tag price. They could oblige you to choose their financing option, apply for an extended warranty or insurance, or avail of any add-ons that you won’t need. They can also put you in a lock-in period. If you want to save money on car, be sure that you pay attention to everything before signing the contract.
Always go to a dealership with a comprehensive plan to save money on car. You should already know the upgrades you want before reaching out to them. Avoid giving them too much information since they will use it to their advantage. Do not quickly agree to add-on packages and unimportant upsells.