When it comes to buying cars, most people think that the best way to get a good deal is to go through many car dealers. People tend to think that going to car dealers is a lot safer and easier than going through private sellers. In this blog post, we will discuss 10 of these secrets. By knowing these secrets, you can save yourself a lot of money when buying your next car!
#1. The dealer’s invoice price is not what they paid for the car
When dealers order cars from the manufacturer, they are given what’s called an “invoice price.” This is the price that the dealer pays for the car, before any markups or fees. You might think that you can just go to the dealership and ask for the invoice price, and then negotiate from there. The invoice price on a car can be deceiving – the dealer usually adds on a lot of extra fees and markups, which can drive the price up significantly. So, if you’re trying to get a good deal on a car, don’t focus on the invoice price – focus on what the dealer is charging.
#2. The dealer’s “holdback” is not free money
Another way that dealers make money is through something called a “holdback.” A holdback is a percentage of the car’s price that the manufacturer pays to the dealer. This amount can be anywhere from 0-15% of the total price, and it varies from manufacturer to manufacturer.
Some dealers will try to tell you that the holdback is “free money” that they can use to lower the price of the car. However, this is not true – the holdback is built into the dealer’s profit margin, and they are already making money off of it. So, don’t let a dealer trick you into thinking that they can use the holdback to lower the price of the car!
#3. Dealer add-ons can increase the price of the car by thousands of dollars
Another way that dealers make money is through something called “add-ons.” Add-ons are extra features or services that the dealer adds to the car, such as a warranty or an extended service contract. Often, these add-ons can significantly increase the price of the car. Don’t let the dealer trick you into thinking that their add-ons are the only option available – there are often cheaper and better alternatives available!
#4. The dealer can make a lot of money off of financing
When you finance a car through the dealership, the dealer makes a lot of money off of the interest. This is because the dealership gets to mark up the interest rate on the loan. So, if you finance a car through the dealership, you’re going to be paying a lot more for your loan than you would if you went to a bank or credit union. If you’re interested in getting a good deal on your car loan, try to get pre-approved for a loan from a bank or credit union before you go to the dealership.
#5. When you buy used cars, the dealer often charges more for them than they’re worth
The dealer often charges more for used cars than they are worth. This is because dealerships typically have a higher overhead than individual sellers. So, when you buy a used car from a dealership, you’re often paying more for the car than it’s worth. If you’re interested in buying a used car, try to find one that’s been sold by an individual rather than a dealership. This will save you money and you’ll be getting a car that’s worth the price you’re paying for it.
#6. The best time to shop for cars is the end of the month
The best time to shop for cars is at the end of the month. This is because dealerships are trying to meet their sales goals for the month, and they will often offer better deals on cars at the end of the month. So, if you’re looking for a good deal on a car, try to shop at the end of the month.
#7. Dealerships often have different prices for the same car
One thing that many people don’t realize is that dealerships often have different prices for the same car. This is because each dealership has a different profit margin, and they will price the cars accordingly. So, if you’re looking for a good deal on a car, it’s important to shop around at different dealerships.
You may also be able to get a better deal on a car by negotiating with the dealer. So, if you don’t see the price you’re looking for, ask the dealer if they can lower it. Often, the dealer will be willing to negotiate on the price of the car if they know that they’re losing your business.
#8. The dealer will try to persuade you to acquire a used car at a high price.
When you go to a dealership to buy a used car., they will persuade you to acquire a used car at a higher price. The dealer will say that the car is in good condition and it will last long. They might also say that the previous owner took good care of it. Do not believe everything that the dealer says. You should always take your time to check out the car before making a decision. A service like RegCarCheck will help you run a vehicle check on the car before you make a purchase.
#9. The dealer will give you a low trade-in value for your car
When you go to trade in your old car at the dealership, they will give you a low trade-in value for it. This is because the dealer wants to make as much money off of the sale as possible. So, if you’re looking to get a good trade-in value for your car, it’s important to shop around at different dealerships. You might be able to get a better deal by trading in your car at a private party or through a website like Craigslist.
#10. Don’t hesitate to negotiate!
One of the most important things to remember when buying a car is to not hesitate to negotiate. Many people are afraid to negotiate with the dealer, but it’s important to remember that the dealer is not going to give you the best deal unless you ask for it. So, if you’re looking for a good deal on a car, be sure to negotiate with the dealer. You might be surprised at how much you can save by simply negotiating with the dealer.