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Ten tips: Buying a car? Here's the dealer's side

By LAURA T. COFFEY
Published April 23, 2006

Ever wonder what happens behind the scenes at car dealerships? What tricks do some car dealers use to maximize profit? A writer for the automotive-information site Edmunds.com spent three months working as a car salesman so he could understand the industry from the inside. After that experience, he offered these tips for car shoppers:

1. THE SALESPERSON'S GOTTA EAT. Some dealerships base their salespeople's pay on straight commission - if they don't sell anything, they don't get paid. Reflect on how hungry that smiling salesperson might be. Of course, he or she deserves a paycheck. But the higher the salesperson can jack up the car price, the more he stands to make from you.

2. ARM YOURSELF WITH INFORMATION. One hour's worth of research can protect you from spending thousands more than you should. Two hours' worth can help you get a truly good deal. Without putting in this time, you'll have no frame of reference as to what cars should cost.

3. MAKE WISE USE OF THE INTERNET. You can comparison shop for everything from the car to loans, leases and extended warranties. This will help you feel more confident on the lot. Extensive car-pricing information and reviews are available through Edmunds.com, Kelley Blue Book (www.kbb.com) and Consumer Reports (www.consumerreports.org)

4. LOOK FOR A GOOD LOAN. Low-interest financing likely is available through the dealership, but it's wise to compare the annual percentage rates, or APRs, and the length of several loans at your bank, credit union or motor club. Determine whether you will be hit with fees if you pay the loan off early.

5. KNOW WHAT YOU NEED TO KNOW. Before you walk into the dealership, do enough research to know which car model you want; which options you might want; about what the dealer paid for the car; a decent trade-in price if you're trading in your vehicle; and whether you plan to opt for prearranged financing or financing through the dealership.

6. HAVE KEY NUMBERS IN MIND. Have your dream vehicle's invoice price, sticker price and true market value with you in writing before you start negotiating. Stay focused on what the true price of the car will be, remembering to factor in your trade-in, rebates, other incentives, the length of your loan and your loan's APR.

7. KEEP SEPARATE ISSUES SEPARATE. In your negotiations, stay focused on the car's price. Discuss trade-ins, leasing, financing or rebates separately. It's easy to get confused - and possibly misled - if all those figures get muddled together.

8. SHOP AROUND. Never make the mistake of visiting only one dealership. Instead, get price quotes from three or four. At each of them, ask for the lowest possible markup over the car's invoice price. Write down all the figures you're quoted and leave. Say you'll be back if this is the best price you can find.

9. DON'T RUSH THINGS. Many salespeople will try to get you to buy a vehicle right away. Or maybe you're the one in a big hurry because your clunker just conked out on you. Take the pressure off by renting a car for a week - ideally the kind of car you're thinking of buying. It could be eye-opening.

10. JUST SAY NO IF NEED BE. If a salesperson strikes you as too aggressive, squirrelly or downright deceptive, walk away from the negotiations. You can find a decent salesperson who deserves your business.

Sources: Confessions of a Car Salesman (www.edmunds.com/advice/buying/articles/

42962/article.html cq; Consumer Reports; Florida Attorney General's Office (http://myfloridalegal.com/consumer cq).

[Last modified April 22, 2006, 17:57:02]