Secrets That Car Dealers Don’t Want Consumers To Know

Purchasing a new or used car generally involves a lot of stress, money, and time. Over the years, car dealers have gained a reputation for trying to put pressure on customers and lure them with special offers, discounts, and other benefits. While many car dealers have earned this bad reputation, some actually want to give customers a fair and good experience.

However, the fact remains that all car dealers are out to make a profit. As a customer, you need to educate yourself and be confident when making a deal. Read on to learn about the secrets that car dealers don’t want consumers to know.

Be Cautious Of Car Dealers Who Let You “Talk it Over” In Their Presence

talking it over
Pinterest/Merrchantfintech
Pinterest/Merrchantfintech

If you happen to get trapped in the car dealer’s office bargaining over the numbers, there is a huge possibility that he may pretend to receive a call and leave the discussion to you and your partner. This is an old trick that many salesmen may use to eavesdrop on your conversation. Also, it lets them know what your bottom line is.

If this situation occurs, sending text messages or whispers can be a great way to stop the car dealer from listening to your conversation.

Do Not Fall For The Extended Warranties Offered By The Dealer

family in car
Twitter/mcgonigalbgc
Twitter/mcgonigalbgc

When purchasing a vehicle, the car dealer may try to push every single option on you. This sales pitch might also incorporate an extended warranty that you can get from somewhere else at a lower price. Remember, a car dealer earns plenty of money on these services, so don’t buy it.

Also, it’s vital to keep in mind that the finance manager acts as a salesperson, so he or she might try to get more money out of you in every way possible before you leave.

Carry Out Research Ahead of Time

A woman uses her laptop computer
Robert Alexander/Getty Images
Robert Alexander/Getty Images

For many years, car dealers had all the power when it came to dealerships and sales, but now this has entirely changed. Most car buyers today research on the internet before buying a car. With the right information and the availability of several helpful websites such as Edmunds, Autotrader, Kelly Blue Book, and True Market Value, you can easily check out the reviews of a particular vehicle, available rebates, and see what car suits your budget.

By carrying out research ahead of time, you will know what car you want. It also saves you the time of being led around the lot to look at vehicles you either have no interest in, or you cannot afford.

Most Window Sales Stickers Are Actually Markups

monroney sticker
Reddit/Tredlogs
Reddit/Tredlogs

Monroney stickers, also known as the window stickers, don’t include the actual price of the car. You should know that little extras like sealants, VIN etching, and fabric protectants, can all be done at home for way less cost.

You should always ask to see the original invoice and compare it to the Monroney before making the purchase. If the car seller refuses to show the invoice, then go somewhere else.

Car Dealers Want You To Become Tired And Overwhelmed

dealership
Dmitry RogulinTASS via Getty Images
Dmitry RogulinTASS via Getty Images

If you take a long time to walk around the lot and talk more about trade-ins, numbers, and percentages, there will come a time when you will start breaking down. This is called the phenomenon of decision fatigue, which makes you more impatient, especially if you are attacked with choices to analyze and other decisions to make.

Your exhaustion further allows car dealers to influence your decision-making process and bombard you with several options and add-ons.

Never Say Anything About The Down Payment Up Front

cash down payment
Pinterest/morgandennis343
Pinterest/morgandennis343

The car dealer might ask you beforehand: how much money are you ready to put down? This question may seem rational, but what you are actually doing is giving up the bargaining chip far too soon.

There is an industry story about an old man who had $10,000 to give as a down payment for a truck. As the man discussed the payment way too early, this allowed the dealer to raise the price of the truck to counterbalance the down payment. Therefore, it is extremely crucial to know the out-the-door cost of the car before you say anything about your down payment.

Do Not Tell the Dealer You Are Paying in Cash

paying in cash
Twitter/crossnadel
Twitter/crossnadel

You might think that paying in cash is a good move, not always! For many car dealers, the actual profit is in getting the fine print of the financing.

Therefore, revealing to the dealer right away that you are paying in cash, will leave you in no position to bargain. So always negotiate the price first and then tell the dealer if you are paying cash, leasing, or financing.

Dealers Ask Strategic Questions To Make You Devalue Your Car

dealership negotiations
Dmitry RogulinTASS via Getty Images
Dmitry RogulinTASS via Getty Images

When you go to a car dealer with your trade-in, he or she will ask you many questions related to the car, like does it have a sunroof? Or does it have power steering? He already has answers to all these questions, and also knows its worth. He will just try to get a “No” out of you over and over again so that you start devaluing your trade-in and settle for less. To avoid this situation, get the National Automobile Dealers Association (NADA) value, and whatever the dealer asks, just keep that number in your head.

Also, remember to keep the car keys with you before you sit down to negotiate. The car dealers know that if you don’t have your keys on you, it will be a lot harder for you to walk away. They might hand over the keys to a third party like the sales manager, giving them another shot at the sale.

They’ll Actually Use Your Trade-In Value To Increase The Price

man at a car lot
Dmitry Rogulin/Getty
Dmitry Rogulin/Getty

If the car dealer asks whether you are trading in your old car, simply say that right now, you are not thinking about it. Don’t tell them the truth.

Keeping your old car out of the negotiation can help you get a better deal on a new car. Once the price is fixed on your new car purchase, then you can reveal that you do want to trade in your old car.

You Can Cancel Service Contracts Within One Month

keys
Pinterest/Paquitorentacar
Pinterest/Paquitorentacar

If you get entangled in a financial meltdown and pay extra money for add-ons, including tire protection, extended warranty, etc., don’t think that you are stuck. You can easily get out of it within 30 days and get your money back.

You can further use this to your advantage. All you need to do is accept the service plans, which are not included in the actual price of the car. And if you think you paid way too much for these services, cancel them without worry.

The Four-Square Sheet Was Created To Manipulate You

Four Square method
YouTube/David Villa
YouTube/David Villa

The Four Square is a type of negotiation that is used to confuse car buyers by combining the cost of the car, monthly payment, trade-in value, and down payment into one sheet of paper.

Generally, when a salesman comes out with a four-square sheet, the numbers are so high that you would immediately want to walk out. However, this is a strategy so that they get to play their numbers game. And when the numbers are played out, the price of the vehicle rarely goes down, it is just a trick they are using to close the deal. It is suggested that you tell the car dealers not to bring out the four-square sheet or you will leave.

Never Offer To Pay Invoice For Your Car

family buying a car
Twitter/boostyourcreditscore
Twitter/boostyourcreditscore

The invoice of the car does not always tell the entire story about the cost of a vehicle. The dealer gets the factory-to-dealer incentives, dealer holdbacks, and customer rebates on vehicles. So, he can even take off this money from the sales price and offer it to you, but he won’t give you the invoice without an argument.

Remember, these incentives are usually not highlighted, but they can save you tons of money.

The Car Dealer Is Never As Busy As They Seem

man at computer
Oleg Magni/Getty
Oleg Magni/Getty

You might have come across a situation when you are asked to visit the lot around the dealer’s schedule, or you are forced to wait around. This helps to create an illusion that dealer’s time is far more valuable than yours.

Also, it puts the car dealer in a powerful position. Keep yourself aware of these types of manipulative situations and tactics, and remember that they are nothing but mind games.

After-Market Non-Factory Options Are A Scam

A visitor looks at a rim
INA FASSBENDER/AFP via Getty Images
INA FASSBENDER/AFP via Getty Images

Most dealers add extras to the car, which costs them pennies on the dollar. The extras may include alarms, pinstriping, spoilers, rims, and stereo systems. You name anything, and the car dealers will throw it all in. Try negotiating on the invoice price and not the sales sticker price.

Also, you do not need floor mats that cost around $200, and you don’t have to pay for $250 worth of pinstriping. And you can get the tinting done from somewhere else for half the amount that the dealer is charging. If the add-ons are on non-factory prices, ask the dealer to take them off.

Get Your Own Financing Before you Make a Purchase

driving down the road
Pinterest/rmaqhgml112
Pinterest/rmaqhgml112

By taking out a loan from a financial institution or a credit union before you begin shopping, you can negotiate better terms with the dealer in advance. Get all your finances pre-approved before you walk-in and do not leave anything to the dealership.

This will be one of the smartest decisions you will ever make. It will also make the car-buying process a lot easier and less of a headache.

Hail-Damaged Vehicles Cost Way Too Much

man photographing a vehicle
Hyoung Chang/The Denver Post via Getty Images
Hyoung Chang/The Denver Post via Getty Images

If their cars get damaged by hail, the dealerships will reduce the prices and will sell it to you at a discount. You might think you’re getting a great deal. But remember, the dealership has these cars insured, and they also get reimbursed for the damage from the hail.

The car dealer is not passing anything on you, he is just making a lot of profit from the hail-damaged vehicles.

You Can Win The Game Before Going To The Lot

a businessman working at a desk with a smartphone and laptop
Neil Godwin/Future via Getty Images
Neil Godwin/Future via Getty Images

The internet is a powerful place that has done wonderful things for modest people. With the help of the internet, you can email 20 or more dealers at a time and let them know exactly what you are looking for.

Once you have done that, ask them to provide you with a quote. You can now choose the ones that cost you the least and take those to any car dealer. This will encourage the dealer to match the quote you presented, eliminating the profit margin they were expecting to get.

You Have the Power to Control the Sale

shopping for a red car
Miguel Riopa/Getty Images
Miguel Riopa/Getty Images

If you do not feel right about the sale, then use your sales weapon, i.e., your legs, to walk away from the deal. There is a good chance that the salesman will offer a much lower price if you tell them that you have decided against the transaction and get up from your seat.

Always keep in mind that they cannot force you to make the deal work, and you have the power to say “No.” The only thing you will lose is a few hours of your time; what they lose are a bonus and commission.

Monthly Payments Are Misleading

a handshake
Twitter/Capri23auto
Twitter/Capri23auto

When purchasing a car, you should decide on the total amount of what you can afford to pay for the vehicle and ignore the monthly payment criteria. Remember, if you choose the monthly payment method, a car dealer can tamper with the figures, the APR (Annual Percentage Rate), and the length of the loan, and you may end up paying more than the actual price of the car.

It’s essential to take a look at the final price — if the cost of the monthly payment turns out to be too high, then you are paying more than you agreed to.

Get the Best Deals Through Internet Salesman

salesman
Michel Porro/Getty Images
Michel Porro/Getty Images

When you are reviewing the vehicle sales department on the internet, the car dealers already know that you are aware of things. They also understand that you are a smart buyer, and you are comparing prices and looking for more options.

Therefore, salespeople on the internet will offer you services at a much lower rate than the car dealers at the lot. In other words, only visit the lot if you get to meet the salesperson that you have been dealing with online.

You Might Get Into Trouble While Trading In

Two men look at used cars at a dealership
WEDA/AFP via Getty Images
WEDA/AFP via Getty Images

Even if your car is in good condition, there is a good chance that you won’t get a great value on the trade-in. You might think that by following the websites like KBB (Kelley Blue Book), you will know the actual resale and trade-in, but these figures are not always correct.

Most car dealers use the NADA (National Automobile Dealers) database, which provides them an actual idea of what price they can get for your trade. One of the best options is to get a copy of the NADA value to check the real value of your car. You can also sell your car privately to avoid the hassle.

You Do Not Have To Pay For GAP Insurance Through The Dealer

A person driving
Pinterest/profixautocare
Pinterest/profixautocare

Guaranteed Asset Protection (GAP) is insurance coverage that protects you against paying your loan balance if your car is totaled or stolen. If you finance through the dealer, he or she may ask you to purchase GAP insurance.

This is a similar case to where the car dealer tries to squeeze out more money from the financing deal. Be wary of this situation and instead go to a financial institution to get a better deal.

Car Dealers Get Rewards For Financing Through Specific Lenders

certified used Vehicles loan advertisment
Francis Dean/Corbis via Getty Images
Francis Dean/Corbis via Getty Images

When it comes to loyalty rewards, car dealers love them. The dealership’s department of finance sends the actual value and price of the car, as well as your credit history, to various lenders. Basically, all these lenders are in competition competing with each other to get the dealer’s business and not to get you the best price.

Without giving it a second thought, the dealers choose the lender who gives them the best incentive. This means that both the lender and dealer do not care whether the deal is right for you or not. They only think about how to generate the most profit.

Negotiate, Negotiate, Negotiate

Negotiations
Dmitry Rogulin/Getty
Dmitry Rogulin/Getty

When you are dealing with a car salesperson, negotiate the car price based on it’s worth and not based on what you are ready to spend.

Opening the talk by announcing how much you can pay for the car is like bringing a weapon with you and handing it over to the dealer. Also, everything else, including monthly payments, down payments, and interest rates, can wait. All you need to focus on is the sales price.

Some Car Dealers Won’t Tolerate Your Low Offers

saying no
Pinterest/shawnz
Pinterest/shawnz

If you go in with a price that is far too low, the dealer would not waste his time on you, mainly if other customers are waiting in the line.

There are several dealerships out there that spend more money on advertising. This helps them to attract more customers, and thus, this allows them to easily pass on a deal that is not offering them much. They might not necessarily laugh at your low offer, but they won’t accept it.

Dealers Don’t Want You To Think About the Decision You Just Made

after the sale
Dmitry RogulinTASS via Getty Images
Dmitry RogulinTASS via Getty Images

Even after you have agreed on everything, including the price, trade-in value, and financing, the game is still not over as you have not signed anything binding yet.

In the meantime, when the financial manager is getting every document in place, it is now the salesman’s job to keep you distracted and talk about your family, weather, favorite movies, and more. This is done so that you do not think about changing the decision you just made.

Do Not Pay More Than $500 Over Invoice

handing over cash
Twitter/amp
Twitter/amp

When buying a new car, you can pay anywhere between $100 to $500 over the invoice price and still get an amazing deal. It is suggested that you only pay $500 over invoice price on expensive vehicles or $100 on a lower-priced model.

Always remember that the price on the invoice is the dealer’s cost and is entirely different from sticker price and the MSRP (Manufacturer’s Suggested Retail Price). To get more information on the invoice price, you can use the NADA guides.

Shop From The Manufacturer’s Website

woman at a desk
Ben McCanna/Portland Portland Press Herald via Getty Images
Ben McCanna/Portland Portland Press Herald via Getty Images

If you are looking for a new car, then it is always better to get it from the manufacturer’s website. It will not only give you quality assurance but will also save you time and money. Additionally, by visiting the manufacturer’s website, you can get multiple quotes from dealers, which will help you to choose the car as per your requirements and budget.

While shopping through the manufacturer’s website, there is nothing to worry about as car dealers compete with each other, and you will most likely get the price without having to go through the hard negotiation process.

Give The Car Dealer Another Chance To Accept Your Offer

walk away
Twitter/justinwscs
Twitter/justinwscs

It is frustrating when you put an offer forward and the car dealer talks to the manager about it, but comes back with any answer other than yes. What should you do?

This is the time when you should pretend that you are not interested in anything else and get up and start to leave. If the dealer stops you from going, then give him the last chance to make the deal.

Get To Know Out-the-Door Price Of The Vehicle

Used cars are displayed on a sales lot
Justin Sullivan/Getty Images
Justin Sullivan/Getty Images

Most of the time, car dealers play a trick and offer you a low price at first so that they add extra charges later to boost the sales price.

It is crucial to ask the dealer to tell you the out-the-door cost, which may include fees, taxes, and other things related to the purchase of a new car. This way, you would not be shocked by hearing the higher price later, and you also would not waste time settling on a number.

Shop For Less-Popular Models

driving away
Twitter/hypnodarlington
Twitter/hypnodarlington

When car dealers sell cars, they receive the holdback or the money back from the manufacturer. So, it’s always beneficial to go for less popular models so that you can receive the benefit of the holdback and offer a price which is lower than the invoice price.

If you choose a popular car, the dealer will not be able to negotiate much on the holdback price because of the high demand for the vehicle. Whereas if the demand for the car is low, the car dealer can negotiate more openly.

Research The Extended Warranty Properly

car warranty
Facebook/mywarrantyrefund
Facebook/mywarrantyrefund

When buying a new car, the sales manager might offer several warranty options to you after you agree on the price. These extended warranties are said to provide additional protection if anything goes wrong with your vehicle, but the terms and conditions of the contract might restrict you from using it.

Note that extended warranties are very profitable for the dealers, so they might push you to take it. Before buying the extended warranty, read the fine print carefully and make sure that it covers everything.

Send An Email Directly To Multiple Salespeople

emailing on phone
Wodicka/ullstein bild via Getty Images
Wodicka/ullstein bild via Getty Images

Sending one email to salespeople can help you get the best deal on your new purchase. With this email, you need to make sure that the car dealers know who they are competing with. So, ensure that each email address is included and visible in the CC option.

In the email, you can mention all the details of the car and by which date you would like to make a purchase. Also, list all the costs related to the vehicle so that the dealers know that you are aware of everything. Also incorporate discounts and exclusive deals offered by other dealers. At the end of the email, give them 24 hours to reply with their best quotes. This will help you to get the best car deals.

Purchase a Year-End Holdover

warehouse with Minis
Anton Raharjo/NurPhoto via Getty Images
Anton Raharjo/NurPhoto via Getty Images

When the year is about to end, the car dealers need to create more space for the models that will be introduced in the coming year.

So when December arrives, customers get the highest discount on MSRP as compared to the rest of the months in a year. Hence, making a purchase at the end of the year could be worth the wait. Plus, it can be a fun way to treat yourself in preparation for the new year!

Rent Before You Buy

rent first
Twitter/CluettInsurance
Twitter/CluettInsurance

Going for a test drive is a great way to learn more about the car, but you will not get the real feeling until you buy the vehicle. Keep in mind that a car is one of the most significant purchases you will ever make, so it’s vital to ensure that it is worth it.

You can rent the same model that you want to purchase to know how will it actually run if used on a day to day basis. Rent a car for at least a week to see if it meets your requirements. Then, if you think it’s a match, make the actual purchase.

Buy At Larger Dealerships

Mercedes dealership
Michal Fludra/NurPhoto via Getty Images
Michal Fludra/NurPhoto via Getty Images

Shopping at a popular and larger dealership is one of the best ways to get a better price on a car. The buying process can also be easier in many cases and there will be more vehicles to choose from.

Each month, larger dealers tend to move plenty of inventory. This allows them to sell a few cars at a lower price, or $100 to $500 over invoice price. It is the best deal one can ever get.

Have A Calm Attitude

maintain a calm attitude
Pixabay
Pixabay

It’s always better to get something by being polite rather than being insolent and rude. This statement especially stands true when dealing with the salesman.

We all know that purchasing a new car can be unpleasant and stressful at the same time, but having a calm and composed attitude can make your car purchasing experience way more comfortable. Although it’s the job of a salesman to be courteous, he will help you get a better deal only if you’re nice toward him.

Do Not Believe In No-Haggle Pricing

haggling over a purchase
Pinterest/ffgouveia
Pinterest/ffgouveia

Getting a car for an affordable price without negotiating sounds like a dream for customers. However, there is no such thing as no-haggle pricing, so don’t fall for it.

You will need to bargain for the best prices, especially if you are financing through the dealership. So always be prepared to negotiate as it is one of the best ways to get a great deal on the car you are about to purchase.

Negotiate As A Professional

professional negotiations
Tumblr/jedwardsholt
Tumblr/jedwardsholt

You need to be extremely confident while negotiating and make sure that you don’t lose sight of the price that you have decided you’ll pay. If you have done the research about the vehicle and costs involved, you will get the deal for a fair price.

Do not let the car dealer pressurize you or intimidate you into paying more. Let the salesman know if you don’t get a good deal, you will walk out — this will put you in a stronger position.

Before You Drive Off, Give One Final Inspection

final inspection
Getty Images/ Tobias Schwarz
Getty Images/ Tobias Schwarz

A final inspection is extremely crucial to make sure that the car is in good condition. If you find that there are dents, scratches, or other issues, schedule a time with a dealer to get them fixed at no cost.

You can even make this request after you have received the keys and signed the contract. Just make sure to check everything before you drive off the lot.