How to Get the Best Deal on a Used Car?

Q: What’s worse than a used car salesman?

A: (Long silence)

Used car salesmen might have a bad reputation, but today it is far easier to know that you are getting a good deal, whether you buy it off the lot or through the classifieds. Here is what you need to know.

1. Decide what you want

How much car can you afford? How many people will you cart around every day? Will you drive mostly city or highway miles? Do you need hauling capacity? Are you expecting more children in the coming years? These are important things to consider before you talk to a dealer or private seller. You probably also want a reliable car with great consumer reviews and good gas mileage.

To find the best car for you, devote plenty of time to in-depth research. Make a chart with your needs and wants at the top of the columns (cargo space, safety features, cup holders, engine size, gas mileage), then search the Internet for details to fill in the blanks. Look for a website with the finer details by entering “specifications” in the search bar along with the car’s make, model and year.

Look at the major car websites for reliable reviews, like Edmunds.com. Other sites provide the actual value (a private sale, trade-in or realistic retail price) of a new or used car based on its make, model, mileage, and accessories. Kelley Blue Book (kbb.com) is a good place to start. Keep track of the numbers; they are your ammunition for the battle.

2. Compare, compare, compare

Besides comparing details about cars, you should also research:

-Car dealers: Find reviews of car dealers in your area, or ask around for customer reviews. Were they satisfied with the price, professionalism during the transaction, and warranty service? Drop by a dealership or two to get a close-up look at cars and get a feel for their marketing strategy. Are they high pressure or no haggle?

-Car loans: A dealer might give you a good deal on a car loan with a low interest rate, but ask about the specifics. Ask your bank for a quote, and other banks as well. The best deal is the lowest interest rate you can find for the shortest loan period, and not one that will shoot up after a few months.

-Auto insurance: Ask your insurance agent for estimates on premiums for the car models you are interested in. Some cars draw higher premiums because of theft or the tendency of car owners to drive sporty, uber-horsepowered cars aggressively.

3. Time it right

Begin your research months before you plan to buy the car. Besides crunching the numbers to decide which car you want (which can eat serious time), you should prepare by saving money for a down payment and other fees.

Finally, go to the bargaining table on the right day. End of year sales make it easier to get a bargain, but you can also persuade a salesperson to sweeten the deal at the end of the month. Dealerships also have sales over long holiday weekends. If you are in the market for a car and you cannot wait for a holiday or end-of-year sale (whether it is a calendar year or model year, the latter of which occurs in summer), watch carefully for dealership ads that offer hefty rebates and incentives.

If you plan to buy your car from a private seller, the timing does not matter quite as much. However, there seems to be more desperation when the economy takes a sudden downturn.

4. Throw your knowledge around as a bargaining chip

Once you narrow down your list to two or three cars, you can begin shopping. Start shopping online, if you are able, and if you find a car that meets your criteria, get the vehicle identification number (VIN). Using that number, spend about $25 to get a background report. Carfax.com is a popular and reliable source. Some dealers and private sellers provide the report as part of the deal. The report will tell you important information, like whether the car was in an accident, received body work, etc. If the car checks out, use Kelley Blue Book to determine the value. It helps to have as much information as possible to get an accurate figure.

When you are ready to haggle, call or email two or three dealerships and ask to speak to the fleet manager, not a salesperson. Say you are planning to buy a car in the coming week, and you are interested in car A and car B. Even if you really only want car A, keep that to yourself. Showing interest in car B keeps you from appearing too eager over car A. Let them know you are contacting other dealerships and possibly private sellers. Remembering the blue book value you researched, ask each dealer for a quote.

Assume the salesperson is not giving you a low offer right off the bat. Even if you can afford his first offer, make a reasonable counter offer. Or, if you take the first offer, ask him what he can do to make the offer sweeter: A longer warranty? A few extras? Waive the paperwork fees? More money for your trade-in?

Keep in mind that salespeople will not readily jump at low-ball offers, but they won’t be offended if you start low. Some car salesmen only make money from commissions, so start low in the bargaining and move up slowly in very small increments, with a number in mind that you will not exceed, until the salesman agrees. If you have a problem giving car salesmen a profit, you might be better off buying a car on the Internet or through a private sale. Regardless of where you choose to buy, demonstrate your detailed knowledge of the car and what it should be worth, and you should be able to buy a used car at a fair price.

Finally, follow these important rules for buying a car:

• Never appear too eager until you are satisfied with the numbers.
• Never appear too desperate. If you can help it, don’t drive onto the dealership lot with a dying car. (Rent or borrow a car, if you have to.)
• Bargain only for the total price of the car, not monthly payments. Payments can be manipulated. A low monthly payment plan can extend into forever. Add in a higher interest rate and you will pay thousands more over the life of the loan.
• Keep the option open to privately sell your old car, even if you would much rather trade it in at the dealership. You will most often make more money from a private sale. Talk about a trade-in option only after you have agreed on the lowest price you feel is possible for the car you want to buy.
• If you feel pressured to buy too much car for your budget or a car that does not suit your needs, walk away.
• Some states require a “cooling off period,” in which you can return the car, no questions asked, within a certain number of days. Check your state’s laws before you buy.

Buying a car is a major purchase. Fall in love with a slick car based on its color and style, and you might lose thousands of dollars in the hands of an unscrupulous salesperson. Knowledge of a car and its true worth is your main bargaining chip. The next time you step onto a car lot with the intention to buy, show up with all the numbers at your fingertips, and the patience to get what you really want at a fair price.