My first ever car happened to be new Toyota Corolla which I purchased at a local dealership. Sure enough as I came there to negotiate the price I became a target of every possible rip-off technique that the dealers are very good at. Well, I was young and green.
My next two cars were 2-3 year old used models which I think is the best deal value-wise. Cars depreciate the most during the first year or so and if you are a frugal shopper you absolutely don’t want to pay that premium.
Unfortunately buying a used car has some specifics that add a lot of overhead to the shopping process and often make the end result unpredictable.
Never trust the dealer
One such thing is that you can never be sure that what the dealer claims about the used car is truth. The better the bargain looks the more chances are that there is something wrong with it.
My last car buying experience is a good example. As soon as I brought the car home I discovered a bump on the side which I didn’t noticed before. Another surprise came later when I found that the car, despite the dealer claims, was in-fact in an accident. I found out about it when I myself damaged the car bumper and saw another layer of paint.
Things like these amplify my desire to go shopping for a new car after I run down my current one. And there might be not long before I will have to do so. :-(
Do your shopping online
Another advantage of buying a new car compared to used is that you can do all the shopping online. Well, sure thing you have to test drive the model you intend to buy, but you don’t have to buy that particular car at the spot. In fact you must not if you want to get the best deal. Instead you should ask the dealer to send you a quote by email and then do all the negotiation online.
Don’t just request a quote from one place. Call to a few dealers of your choice and ask them all to send you a quote. In addition go to Edmunds and use their Get Dealer Pricing service. You will be asked to enter your phone number as well however selecting the Contact Preference as “Email Anytime” should prevent most of the annoying phone calls (yes, I do hate talking to dealers).
Use shopping tricks
Now comes the most interesting part (and I learned this trick just recently). As you start receiving the offers reply every single one with something like this:
Sorry, while I really want to buy this car, I’m afraid your bid takes you out of the running. If you want to make another offer today, I’ll look at it.
This will bring you to the second round of bidding. In case some of the dealers drop out you will know that they have offered the best price. But more likely you will see new better offers coming in. They do want your sale!
At the end simply choose the best price and accept it. Even if it happens to be one of the offers you rejected — nothing prevents you from replying with another email explaining that circumstances changed (e.g. the competitor didn’t have the right color) and you do want that price after all. ;-)
Bonus tip!
To completely avoid having to talk to the sales people you can get a temporary number from a free service like www.7k.net (no longer in service) or www.privatephone.com and have all incoming calls redirected to a voice mail. You can then listen to the messages at your convenience and return the calls you like. Some of these services will receive faxes as well.
I wrote before about bargaining techniques you can use to 