Buying a car is a significant financial decision, and navigating the dealership can feel like a high-stakes game. It’s crucial to enter the process informed and prepared, especially when it comes to your communication. Knowing what not to say can be just as important as knowing what to say. Avoiding certain phrases and revealing too much information can weaken your position and ultimately cost you money. This guide will equip you with the knowledge to keep your negotiations strong and help you drive away with the best possible deal.
Protecting Your Negotiating Position
One of the biggest mistakes buyers make is revealing their hand too early. Dealers are skilled at extracting information and using it to their advantage. Avoid statements that make you seem desperate or reveal your budget constraints. The goal is to maintain control of the negotiation and avoid giving the dealer leverage.
Avoid Revealing Your Maximum Budget
Never tell the dealer the maximum amount you are willing to spend. This is a golden nugget of information they can use to push the price right up to your limit. Instead, focus on the monthly payment you are comfortable with or the out-the-door price you are seeking.
“I’m looking to stay under $40,000” is a red flag. The dealer now knows your upper limit and will likely structure the deal to reach that number, regardless of whether it’s the best price for the car.
Instead, try: “I’m looking for a monthly payment in the $400 range.” This shifts the focus to affordability and allows you to negotiate the terms of the loan, rather than just the price of the car.
Don’t Show Too Much Enthusiasm
Expressing excessive enthusiasm for a particular vehicle can also weaken your position. If the dealer knows you are head-over-heels in love with a specific car, they are less likely to offer significant discounts.
“I absolutely love this car! It’s exactly what I’ve been looking for!” is a statement that screams, “I’m willing to pay a premium!”
Instead, try: “This car has several features I’m interested in. Let’s discuss the price and options.” This acknowledges your interest without revealing your emotional attachment.
Avoid Discussing Your Trade-In Too Early
Delay discussing your trade-in until you have negotiated the price of the new car. Separating these two transactions prevents the dealer from manipulating the numbers to make the deal seem better than it is.
Discussing your trade-in value before the new car price allows the dealer to inflate the new car price while offering a seemingly good price for your trade. This can create the illusion of a great deal, when in reality, you are overpaying.
Instead, focus on negotiating the best possible price for the new car first. Once you are satisfied with that price, then introduce your trade-in and negotiate its value separately.
Phrases That Undermine Your Credibility
Certain phrases can make you appear uninformed or easily manipulated. Dealers are trained to identify and exploit these vulnerabilities. Avoiding these phrases will project confidence and help you maintain control of the negotiation.
Never Say “I Need This Car”
“I need this car” is perhaps the worst thing you can say to a dealer. It indicates desperation and completely eliminates your negotiating power. The dealer knows you are highly motivated to buy, and they will likely offer you a less favorable deal.
Instead, maintain a neutral and objective approach. Emphasize that you are exploring your options and considering different vehicles.
Avoid “What’s the Monthly Payment?” Without Discussing Price
Focusing solely on the monthly payment without discussing the total price of the car can be a costly mistake. Dealers can manipulate the loan terms (interest rate, loan duration) to achieve a desired monthly payment while increasing the overall cost of the car.
Always negotiate the out-the-door price first. Once you have agreed on a price, then discuss financing options and the resulting monthly payment. This ensures you are not being overcharged due to unfavorable loan terms.
Don’t Say “I’m Not Good at Negotiating”
Admitting you are not good at negotiating is like handing the dealer a blank check. They will likely take advantage of your perceived lack of experience and offer you a less favorable deal.
Even if you are not a seasoned negotiator, project confidence and assertiveness. Research the car’s market value, come prepared with your own financing options, and be willing to walk away if the deal doesn’t meet your needs.
Statements That Hinder Informed Decisions
Making uninformed statements or relying on assumptions can lead to poor decisions. It’s essential to be knowledgeable about the car, its market value, and the various fees involved in the transaction.
Avoid “I Trust You”
While building rapport with the dealer is important, blindly trusting them is a recipe for disaster. Remember, they are ultimately trying to make a profit.
Always verify the information provided by the dealer. Read the fine print, double-check the calculations, and don’t hesitate to ask questions. Trust, but verify.
Don’t Assume Advertised Prices Are Accurate
Advertised prices often include hidden fees or require specific qualifications (e.g., military discount, recent college graduate). Don’t assume the advertised price is the actual price you will pay.
Always inquire about the out-the-door price, which includes all taxes, fees, and other charges. This will give you a clear picture of the total cost of the car.
Avoid Ignoring the Fine Print
The sales contract is a legally binding document. Ignoring the fine print can lead to unexpected charges, unfavorable loan terms, or other unpleasant surprises.
Take the time to carefully read and understand the entire contract before signing. Don’t hesitate to ask the dealer to explain anything you don’t understand.
Negotiation Strategies for Success
Now that we’ve covered what not to say, let’s briefly touch on some strategies that can improve your negotiating position. Research is key, so arm yourself with information about the car’s market value, available incentives, and your credit score. Obtain pre-approval for financing from your bank or credit union. Be prepared to walk away if the dealer is unwilling to meet your terms.
Researching Fair Market Value
Before even stepping foot in a dealership, conduct thorough research on the fair market value of the car you want. Websites like Kelley Blue Book (KBB) and Edmunds provide valuable information on pricing trends and what others are paying for similar vehicles in your area. Knowing this information empowers you to negotiate from a position of strength.
Securing Pre-Approved Financing
Getting pre-approved for an auto loan from your bank or credit union is another crucial step. This gives you a benchmark interest rate and loan terms to compare against the dealer’s financing offers. It also shows the dealer you are a serious buyer and have other options.
The Power of Walking Away
One of the most powerful tools in your negotiation arsenal is the willingness to walk away. If the dealer is unwilling to meet your price or offer reasonable terms, don’t be afraid to leave. Often, they will reconsider and contact you with a better offer. This demonstrates that you are serious about getting a fair deal and are not afraid to explore other options.
Red Flags to Watch Out For
Dealers sometimes use deceptive tactics to pressure buyers into making hasty decisions. Be aware of these red flags and don’t hesitate to walk away if you encounter them.
Pressure Tactics
Dealers might use pressure tactics such as “This offer is only good today!” or “Someone else is interested in this car.” These tactics are designed to rush you into making a decision without carefully considering all the factors.
Hidden Fees
Be wary of hidden fees that are not clearly disclosed upfront. These fees can include dealer preparation fees, documentation fees, or other charges that can significantly increase the overall cost of the car.
Unwillingness to Negotiate
If the dealer is unwilling to negotiate or refuses to provide a detailed breakdown of the price, it’s a sign that they are not being transparent. Consider taking your business elsewhere.
Maintaining a Professional Demeanor
Even though the car buying process can be stressful, it’s important to maintain a professional and respectful demeanor. This will help you build rapport with the dealer and increase the likelihood of a positive outcome.
Remain Calm and Composed
Avoid getting emotional or angry during the negotiation. Stay calm and composed, and focus on presenting your arguments in a clear and rational manner.
Treat the Dealer with Respect
Even if you disagree with the dealer’s offers, treat them with respect. Rudeness or aggression will only make the negotiation more difficult.
Be Prepared to Walk Away
As mentioned earlier, the willingness to walk away is a powerful negotiating tool. If the dealer is unwilling to meet your terms, don’t be afraid to leave.
By understanding what not to say to a car dealer, and by implementing effective negotiation strategies, you can significantly improve your chances of getting a fair deal and driving away with the car you want at a price you can afford. Remember, knowledge is power, so arm yourself with information and approach the negotiation with confidence.
What’s the biggest mistake people make when negotiating a car price?
The single largest error is revealing too much information upfront. Disclosing your maximum budget, monthly payment constraints, or strong desire for a specific vehicle weakens your negotiating position considerably. Dealerships are skilled at tailoring deals to fit within your stated limits, often at the expense of a lower overall price.
Instead of sharing your personal financial details or emotional attachment to a certain car, focus on researching comparable vehicle prices in your area and understanding the invoice price. Armed with this knowledge, you can steer the conversation towards the actual value of the car, rather than your perceived affordability or eagerness. Keep your cards close to your chest and let the dealership make the first offer.
Is it a bad idea to mention I have a trade-in early in the negotiation?
Yes, it generally is. Bringing up your trade-in early can muddy the waters and make it difficult to separate the price negotiation for the new car from the valuation of your trade. Dealers might use this to their advantage, inflating the price of the new car while offering a seemingly fair price for your trade-in, or vice versa.
The optimal strategy is to negotiate the best possible price on the new car first. Once you’ve reached an agreement on that price, then introduce your trade-in as a separate transaction. This allows you to compare the dealership’s trade-in offer to other options, such as selling it privately or getting quotes from other dealerships specializing in used cars.
Should I tell the dealer I’m pre-approved for a loan?
While being pre-approved shows you are a serious buyer, revealing this information too early can limit your negotiating power. The dealer might assume you are less price-sensitive and therefore less likely to push for a lower price, knowing you already have financing secured. They may also attempt to beat the interest rate on your pre-approved loan, potentially steering you towards a less favorable financing option.
A better approach is to hold onto this information until you have negotiated the final price of the car. Once you have a deal you’re happy with, you can then inform the dealer of your pre-approval and allow them the opportunity to try and beat the rate. If they can’t, you can simply stick with your pre-approved loan, knowing you’ve already secured a good price on the vehicle.
What’s the worst thing to say when discussing monthly payments?
The phrase “I need my monthly payment to be under [specific amount]” is a red flag for car dealerships. It instantly signals that you are primarily focused on the monthly payment, not the total price of the vehicle. This allows the dealer to manipulate the loan terms, such as extending the loan duration or increasing the interest rate, to meet your desired monthly payment while potentially charging you significantly more over the life of the loan.
Instead of focusing on the monthly payment, concentrate on negotiating the out-the-door price, which includes all taxes, fees, and other charges. Once you’ve agreed on that price, then you can discuss financing options and determine the monthly payment based on a reasonable loan term and interest rate. This gives you greater control over the overall cost of the vehicle and prevents the dealer from using the monthly payment as a tool to inflate the total price.
Is it a mistake to express how much I love a specific feature of the car?
Yes, expressing excessive enthusiasm for a specific feature can weaken your negotiation. While it’s natural to be excited about certain aspects of the vehicle, revealing a strong emotional attachment gives the dealer leverage. They know that feature is important to you and may be less willing to offer discounts or negotiate on other aspects of the deal.
Instead of gushing about specific features, focus on the overall value and benefits of the car compared to its competitors. Research other vehicles with similar features in the same price range and highlight any advantages those alternatives may offer. This shows the dealer you are a discerning buyer and willing to consider other options, which can encourage them to offer a more competitive price.
Should I ever tell the dealer I’m in a hurry to buy a car?
Revealing that you are in a hurry significantly weakens your negotiating position. Dealers thrive on urgency, as it reduces your willingness to shop around and compare prices. Knowing you need a car immediately, they are less likely to offer significant discounts or concessions, understanding you’re limited by time constraints.
Avoid mentioning any deadlines or urgency. If possible, visit dealerships well in advance of when you actually need the car. This gives you ample time to research, compare prices, and negotiate without feeling pressured. If you are genuinely in a hurry, try to disguise it and focus on the long-term value of the purchase, not the immediate need.
What’s a common phrase that dealers use to pressure buyers, and how should I respond?
A common pressure tactic is “What will it take to get you in this car today?” This phrase is designed to encourage you to make an impulse decision and potentially agree to unfavorable terms. It often implies that a special deal is only available for a limited time, creating a sense of urgency.
The best response is to calmly reiterate your desired price or terms and emphasize that you are not pressured to buy today. State that you are carefully considering your options and will only proceed if the deal meets your requirements. You can also counter by asking, “What’s the best price you can offer me today regardless of whether I buy or not?” This shifts the focus back to the dealer and forces them to provide their best offer upfront.