10 keys to getting a great deal
How to buy a used car for the best price.
There's a lot more to getting a good deal than simply haggling with the salesperson or private seller. Being prepared with the right information, doing your homework, and negotiating from an informed perspective can all translate into money saved in the end. Here are 10 tips from Consumer Reports' auto experts for getting the best price on any used car.
1. Know the value of the vehicle.
You should know the value of your candidate car, regardless of what the seller is asking. To do that, you'll need to find what similar cars are selling for. Condition, mileage, age, equipment levels, and the region all affect the value of a used vehicle.
Lots of sources provide used-car price information. Kelley Blue Book, Edmund's, and the National Automobile Dealers Association (NADA) provide pricing information on their Web sites and in printed guides. These sources give price ranges by year and trim line, with adjustments for options, mileage, and sometimes region.
Another tool you can use is the Consumer Reports Used Car Price Service. It helps you determine the right price, whether you're buying or selling, and includes detailed reliability information for most models and buying advice from CR's auto experts.
2. Check with several price sources.
Different price guides list different "book" values. For example, at this writing the Kelley Blue Book lists the retail selling price for a 2001 Nissan Maxima SE (in good condition and with 48,000 miles) as $14,060. The NADA guide lists it at $15,075, Edmund's at $14,135, and the CR Used Car Price Report at about $13,425.
Auto dealers have been known to play games with those price guides. They'll show you one guide, whose prices are on the high end of the spectrum, to indicate the cost of the cars they have for sale. Then they'll whip out another guide with lower values to tell you what your trade-in is worth.
You can avoid that high-ball/low-ball game if you see it coming. Most guides have listings for both retail and trade-in (wholesale) prices. Ask the salespeople to use one book or the other if they're going to use published price guides at all.
3. Determine the local value.
Regardless of what a car's "average" selling price may be, supply and demand will affect the price in your area. To know what a car is worth in your area, check out local classified-ad publications and newspapers. Internet used-car sites can also help you compare prices both within your locality and across the country.
In some cases, it may be worth it to look outside your home area. Prices may vary by thousands of dollars from place to place. The main drawback to going far afield to buy a car is that the vital personal-inspection step probably means trekking to wherever the car is located, perhaps more than once.
4. Ask the right questions.
Before you make a trip to see a car that's been advertised, call the seller for information. Whether it's a dealer or a private party, you want to be sure the car is still available, and you'll want to fill in any missing information.
Ask for details such as:
5. Know your financing options.
Unless you're paying cash, you should research your financing options. Compare interest rates at various financial institutions, such as banks, credit unions, and loan organizations. If you're buying from a dealership, compare its rates with the others. It's often an advantage to get pre-approved for a loan; if you're buying from a dealer, this keeps the financial arrangements out of the negotiating process. If you're buying from another source, they might negotiate more seriously if they know that you already have the money "in hand."
Remember that the duration of the loan affects the monthly payment and total purchase price. A shorter loan means higher monthly payments, but less money paid overall. Many dealers will work with buyers who might be considered credit risks, but such a loan may have a higher interest rate.
6. Know your trade-in value.
If you're buying from a dealership, you may want to trade in your current car at the same time you buy the new one. Before you talk trade-in, though, you should have a general idea about how much it's worth. You can gauge the value of your trade-in the same way you researched the price of the new car, except that now you should focus on the used-car wholesale price instead of the retail price.
Before going to the dealership, spend some time sprucing up the car to improve its curb appeal. If you feel the dealer is not offering you enough, you can always take your vehicle elsewhere or sell it yourself.
7. Never negotiate under pressure.
Salespeople's favorite customers are those who seem to be in a rush, since they tend to be the ones that do not inspect the car thoroughly, buy a more expensive car than they set out to, or don't negotiate down the price. Never go to a dealership acting hurried, even if you need new wheels immediately. They'll assuredly take advantage of it.
Many salespeople assure you that they won't pressure you into buying, but they usually do it anyway. For instance, they might tell you that someone else is very interested in the same car and is coming by later to look at it--a common sales tactic. Even if it is true, you should never feel that you have to make any deal immediately; there's always other cars out there.
8. Haggle the price like a pro.
No matter whom you're buying from, you can expect some dickering. Even if the seller says the price is non-negotiable, offer less. Use local classified ads and price-guide data for similar cars to illustrate the fairness of your offer.
Begin by offering less than what you're willing to pay and move up from there. Don't be shy; mention any flaws or equipment problems to justify your lower offer.
State your final offer clearly, say nothing more, and see what happens. If the seller won't budge, walk away. Remember, you shouldn't pay more than what your homework has told you the vehicle is worth. If you head for the door, you'll often have a deal you can live with before you reach it.
9. Deduct repair costs from your offer.
A low price is no bargain if the vehicle's not in good condition. When you've located a car you're serious about buying, conduct a thorough inspection. If you're not so confident about gauging a car's condition yourself, bring a knowledgeable friend with you to help inspect the car.
You should also have an independent mechanic perform a diagnostic inspection of the vehicle for you. A dealer should have no problem lending you the car to have it inspected as long as you leave identification. A private seller may be more reluctant, however. Leave your own car as assurance you'll return, or offer to follow the seller to the shop where the inspection will take place.
A thorough inspection will cost about $120 or so--which is money well spent if it uncovers any problems. If any problems are uncovered, you should cite your costs of making repairs to justify offering less.
10. Don't pay for more car than you need.
When looking at popular models, there are often a number of vehicles from which to choose. A car that's loaded with extra features and options can cost you much more than the same car with less equipment. Decide what features you really need and which you can do without.
Try to gauge the value of the model, equipped the way you want, and then try to stick to that price even if you're looking at a better-equipped version. If sales interest is slow, the seller may come down to your price. Be wary of customized cars. Thousands of dollars poured into cosmetic or performance improvements may not be worthwhile for you and may even hurt the vehicle's driveability.
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