Photo Credit: iStock/BrianAJackson
Notice all those recent TV commercials touting a “December to Remember,” “Employee Pricing,” “Year-End Sales Event” and other proclaimed deals on a new set of wheels?
That’s because it’s crunch time for dealerships to meet annual sales goals…just as winter weather and (other) holiday shopping can keep consumers off their lots. So now is when manufacturers and dealerships typically offer the year’s deepest discounts and most generous incentives, making December – and particularly its last two weeks – the very best time to buy a new car, according to experts.
But that doesn’t mean some car salesmen still won’t try to rip you off. So before heading to a dealership, check websites such as Kelley Blue Book, Edmunds and TrueCar to research incentives, rebates and prices in your area – including the invoice or “dealer’s cost” for your desired vehicle – and a ballpark selling price for any trade-in you may have. (Good sources for preowned cars also include AutoTrader and Cars.com.)
Then email several dealerships requesting their best “out-the-door” price (including taxes, tags and title) for the specific make, model and trim line of the vehicle for you seek. To avoid bait-and-switch scams, ensure that any particular cars advertised with a great price is still in its inventory (or another with the same trim and options is available), and that any manufacturer rebates and other incentives are not built into your starting price for negotiations. All the while, steer clear of these common tricks:
Focusing on monthly payments. This allows salesmen to meet virtually any monthly price you seek; they just extend the car loan, lowball your trade-in or play other shell games to make you think you’re getting a deal. Better: First dicker on a purchase price. Then handle your trade-in as a separate transaction. Only after doing both should you discuss and compare any loan rates and monthly payments at several dealerships, as well checking loan options with banks and credit unions.
Supplemental sticker swindles. Along with the official MSRP, you may find an additional window sticker listing charges of $595 or more for “Dealer Prep,” “Special Value Package” or simply labeled as ADP or ADM (which stands for “Additional Dealer Profit” and “Additional Dealer Markup”). These hefty prices usually involve little more than a couple of hours work “prepping” the vehicle by vacuuming its interior, washing the exterior, adding fluids, removing plastic from the seats, or perhaps a quick spraying to provide fabric protection or rust-proofing. Don’t believe claims these extra charges are mandatory; they can be waived – or at least credited in your negotiated price.
Trade-in trickery. Some salesmen will quote a low-ball price for your trade to determine if you’re sucker who bites. Others may initially quote an overly generous offer sight unseen to bait you to the showroom, and then renege that high-ball price in person, claiming your vehicle is in worse condition than expected. That’s why it’s wise to have – in-hand – realistic trade-in values based on condition and mileage (as well as year, make and model) from websites like KBB, Edmunds and AutoTrader. Again, negotiate your trade separately from the purchase price of the new car.
Post-sale packing. These tack-ons include unnecessary but expensive extended service warranties, GAP or credit insurance, “etching” the Vehicle Identification Number (VIN) onto windows, and sometimes fabric protection or rust-proofing not on supplemental window stickers. Most experts agree that extended warranties aren’t worth the money. GAP insurance is wise for some buyers, but shop around; dealers may charge twice as much as insurance companies for similar coverage.
Financing follies. Despite all those low-interest finance incentives, some dealers imply that certain buyers have worse credit ratings than they really do to trick them into a higher-rate loan. Others take it one step further: In the most common financing scam (known as “yo-yo” financing) some dealerships initially lead buyers to believe their loan application was approved – only to call back a few days later (after driving off the lot) to say that financing didn’t go through and a larger down payment or higher-rate loan is required to keep the car. Avoid these and other financing fleeces by knowing your credit score before car-shopping, and determine your qualifying interest rate by calling credit unions, banks or even a buying club such as Costco. If you do finance with a dealer, don’t sign anything with a “contingency clause” that stipulates the sale terms hang on the dealer getting the “promised” financing.
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