When purchasing a used car, it is important to understand how dealerships make their money. You should keep in mind that the purchase price of the car is far from the only way the dealer can maximize the amount of money they can make off of selling you a used car. If you understand the other ways they can make money, you can make sure you don't become a victim of good salesmanship.
1. I would say number one trick that is used is charging you a higher rate on financing than you can get on your own. The dealership gets paid a fee for overcharging you on the rate, so always arrange financing before you go to the dealership. Don't tell them you have done so until you are ready to pay. They will get angry and say things like the financing check you brought is no good, but just ignore this tactic. Let them know the only way they are selling the car is to accept your outside financing. You will probably face less aggravation if you refuse to even fill out a credit application. You don't need an additional credit inquiry anyways. They get angry at this because they offered you a good price on the car while planning to make their money on the financing.
2. Extras such as undercoating, dealer added options, and longer warranties can all be shopped around for after buying the car. If you buy them when purchasing the car, you may not be getting the best deal.
3. Chances are if the car your buying has been in an accident, the dealer won't tell you even if they know it has. If you don't trust yourself to see the signs of repair work, have a trusted mechanic look over the vehicle. Cars that have been in accidents often have greater maintenance problems than those that haven't. Services such as Carfax may be helpful, but can't guarantee they have all accident information. Some people never report accidents and fix the car themselves to keep their insurance rate lower.
4. If you plan on trading in a vehicle, don't expect to get its true value from the dealer. They are going to underpay you for your vehicle. The only tactic which may get you a fair price for it is if you refuse to do a deal unless they pay off your current auto loan. Otherwise you may just be better off selling it on your own.
5. The dealer always wants you to buy the most expensive car your willing to buy and will repeatedly suggest the nicer more expensive car, know what you want before you begin to deal or you may end up buying more car than you can afford.
You’re the one that has to live with the car for years, so don't buy on impulse and take the time to get the best deal.
1. I would say number one trick that is used is charging you a higher rate on financing than you can get on your own. The dealership gets paid a fee for overcharging you on the rate, so always arrange financing before you go to the dealership. Don't tell them you have done so until you are ready to pay. They will get angry and say things like the financing check you brought is no good, but just ignore this tactic. Let them know the only way they are selling the car is to accept your outside financing. You will probably face less aggravation if you refuse to even fill out a credit application. You don't need an additional credit inquiry anyways. They get angry at this because they offered you a good price on the car while planning to make their money on the financing.
2. Extras such as undercoating, dealer added options, and longer warranties can all be shopped around for after buying the car. If you buy them when purchasing the car, you may not be getting the best deal.
3. Chances are if the car your buying has been in an accident, the dealer won't tell you even if they know it has. If you don't trust yourself to see the signs of repair work, have a trusted mechanic look over the vehicle. Cars that have been in accidents often have greater maintenance problems than those that haven't. Services such as Carfax may be helpful, but can't guarantee they have all accident information. Some people never report accidents and fix the car themselves to keep their insurance rate lower.
4. If you plan on trading in a vehicle, don't expect to get its true value from the dealer. They are going to underpay you for your vehicle. The only tactic which may get you a fair price for it is if you refuse to do a deal unless they pay off your current auto loan. Otherwise you may just be better off selling it on your own.
5. The dealer always wants you to buy the most expensive car your willing to buy and will repeatedly suggest the nicer more expensive car, know what you want before you begin to deal or you may end up buying more car than you can afford.
You’re the one that has to live with the car for years, so don't buy on impulse and take the time to get the best deal.
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