Several Common Mistakes Car Buyers Make
April 30th, 2009 Muscle CarsCommon Mistakes Car Buyers Make
Automakers, desperate to sell their inventories, have begun offering attractive incentives to lure prospective buyers. But, finding an automotive bargain can still prove elusive. Car dealerships can easily confound buyers and secretly hide pockets of profit. For the unwary, a trip to the auto dealer may begin as a bargain-hunting expedition, but end up as an expensive lesson in car shopping.
In this article, I’ll give you three important tips that you should use when shopping for your next vehicle. These tips will help you save money, save time, and negotiate objectively to get the best deal.
#1 – Set Your Emotions Aside
You visit the dealership lot and your eyes settle longingly on the gorgeous red automobile gracing the nearby pavement. You must have it, no matter the price. Slow down and take a breath. Buying a vehicle is a substantial investment. Unless you’re paying cash, you’ll be making monthly payments for several years. Will you feel the same way about the car three or four years down the road? Or, are you merely suffering from love at first sight?
#2 – Keep The Numbers Separate
If you’re hoping to trade-in your clunker to have the value applied to your new automobile, be careful. When it comes to numbers and amortization schedules, the dealer’s salesperson is king. Too often, prospective buyers will blend the negotiations. Predictably, the salesperson will offer what seems to be an incredibly generous amount on the trade-in. The buyer, reeling from his good fortune, practically falls into the seat of his new vehicle. Unknown to him or her, the dealer’s profit is built into the monthly payments.
Negotiate the transactions separately. Begin with cementing the price of your new automobile. Then, work on the value of your trade-in. That way, you’ll know whether you’re truly getting a good deal (on both transactions) or if you’re being taken around the block.
#3 – Shorten The Financing Terms
One of the strategies that auto dealerships are using in order to entice people into buying new vehicles is offering a 7-year loan. At first, it sounds great; a longer loan means lower monthly payments. The truth is, longer financing terms translate into a higher cost for you and more profit for the dealer. In other words, they’re not offering it to be nice.
If possible, say no to the extra long loan. Instead, opt for shorter terms that allow you to pay off the loan more quickly. You’ll pay less interest and when the time comes to sell your car, you won’t find yourself owing more than it’s worth.
Even though the car-buying landscape has shifted in favor of the buyer, you should still be wary of making a purchase decision too quickly. Remember, set your emotions aside, keep your trade-in negotiation separate, and avoid the extra long financing. By the time you leave the dealership lot, you’ll be confident that you weren’t taken for a ride.
Tags: Automobiles, Car Buying, Car Tips, Cars, Vehicles