|
Buying a Car - Make an Offer
Making the
Car Offer
When you go into a dealership, you want to know all of the
pricing and costs of the car that you are looking into buying,
as mentioned earlier.
You should know the manufacturer’s cost and the dealer’s
cost.
You need to calculate the cost that the dealer paid for the
car and then make a reasonable offer to him if you want to get
somewhere.
You should also know that the dealer’s price is not the
invoice price from the factory. You should know that the dealer’s
cost is much lower than the factory’s cost.
In order to make a fair offer to a dealership, you need to
learn to read a factory’s invoice. Here is what you can
expect to find on the factory invoice.
· Base model of the car on it
· All of the options packages
· Destination charge
· Holdback and dealer flooring help
Quick Tip: DO NOT confuse the invoice with the MSRP window
sticker because they are not the same.
Contrary to popular belief, dealers don’t have to tell
you the invoice on any car. This often gives the dealer leverage
over you.
They can offer you one dollar over the invoice. You should
know that there are hidden factory incentives in the invoice
price that lowers the cost of the car for the dealership. It’s
no bargain for you.
If a dealership is very quick to show you the invoice, you
should be aware that they are fully aware that they will be
making money on that car off of you and they can settle at a
lower price for the car.
Knowing this before you walk into a dealership can be your
best negotiating strategy. See, they will tell you that you
can afford to buy the car at MSRP hoping that you will not then
wonder what the actual worth of that car is.
Knowing this information can let you make them the same offer.
If you offer a few dollars over the factory invoice (which
is the actual worth of the car) then you can open your bid and
let them know how much profit they can make off of your offer.
Check out these websites if you want to know the factory invoice
of a car.
http://www.InvoiceDealers.com
http://www.CarsDirect.com
http://www.Car.com
http://www.Autoweb.com
Dealers are always going to try and tell you that they paid
less for the cars than they actually did so that they can make
a higher profit off of the sale.
Salesmen often try and make you feel guilty by telling you
“I’m losing my shirt off of this deal”.
In truth, you are the one that is losing your shirt off of
the deal, so don’t buy into it.
To calculate what your offer should be to the dealership,
you should get the factory invoice price (don’t forget
to include the options in this price), and add 5% to that amount.
That is how you should calculate your offer the dealership.
When I mention the options, I mean the ones that you can’t
avoid. Some cars come equipped with a CD, sun roof etc. and
these are fees that you can’t avoid paying so sure to account
for these at the beginning.
You should also be sure to account for any buyer rebates as
well in calculating your offer. So in the end your offer should
be calculated like this:
DEALER’S COST + 5% - ANY BUYER REBATES = YOUR OFFER
Calculating your offer to a dealership is as simple as that.
When you are considering how much you can afford for a car,
be sure that you don’t get sucked into paying more than
that.
If you are unwilling to pay more than your opening offer,
let the salesman know that your offer stands firm and how they
will profit from the offer.
In the end you will get what you want on your own terms. To
be certain that you get the drift I will set an example for
you.
You are hoping to buy a Toyota Camry. You do your research
at DealersInvoice.com, and find that the invoice price is $19,922;
MSRP is $22,385. The dealer may offer you the car for $22,000,
and shows you the invoice.
You learned by researching that there is a $500 factory to
dealer incentive; and a $447 holdback on the MSRP (2%).
Based on the above calculations, the dealer’s real cost
is $19,922 (invoice) - $500 (incentive) - $447 (holdback) =
$18,957. This is far below the factory invoice number.
Now, if you add the 5% for your offer to that price, which
will up the car price to $20,379 due to the addition of $455
for the destination charge that is always present, you will
see that based on the offer that the dealership offered, you
just saved yourself $3410.
This may seem complicated but if your use a pre-designed spreadsheet
from CarsDirect.com or AutoUSA.com, the program does all the
calculation for you.
Are you interested in finding used cars at government auctions?
Be sure to check this
resource out.
Auto Loans For Any Credit
Good credit or Bad credit Auto Credit Finders can help you find the financing you need. "Have your loan in your pocket, Before you go car shopping."
Car Finance Info
Get Info on Car Finance from 14 search engines in 1.
Auto Loan Companies
Reach to Auto Loan Companies for free auto loan quotes. Everyday low rate car loans.
|
