Auto Buying Tips and Tricks
How to get the deals
The new 2021 cars are hitting dealerships which means new 2020s are going to be on sale to make room for new inventory. It also means there will be a lot of vehicle trade-ins. So whether you are looking for a new or used car, now is the time to buy.
Here are some tips and tricks to help you get the best deal.
Monday, Monday, Monday
According to U.S. News and World Report, many people believe that if they hit the dealership on a busy Saturday or right before they close they can pressure the salesperson into a better deal. Unfortunately, statistics don’t back that idea. Instead, the best deals can be had on the weekdays, especially Monday. Dealerships tend to not be as busy and salespeople have more time to spend with a buyer. On average you can get an 8% better deal on a weekday, 8.1% on Mondays.
Do Your Homework
If you are looking to buy a specific car, especially when buying a pre-owned car, study up! Know the Kelly Blue Book or Edmunds value. Know what other dealerships are offering. Learn about common problems affecting that model and how to watch out for them.
Watch for the Holidays
Like any product, cars go on sale certain times a year. Those times are when new inventory arrives and big holidays. May is a great time for Memorial Day specials. October offers new inventory and Halloween deals. November and December offer Black Friday, Thanksgiving and Christmas promotions.
Don’t be afraid to walk away. Haggling over price can be a stressful experience but one of the best tools in a buyer’s belt is the option to walk away. Go into a dealership confident, having done your research and don’t be afraid to walk away if necessary. Stick to your guns and don’t be taken for a ride. Start with a ridiculously low number and work backwards. Eventually you’ll get the car you want at the price you deserve.
Get Your Loan from a Credit Union
Now, I’m not saying this just because I work at a credit union and I think they are great. It’s because they actually are great. Banks can offer attractive loans as well but according to a 2018 study by the National Credit Union Administration, banks had an average interest rate of 5.04% while credit unions had a rate of only 3.57% for a five-year car loan. That’s a savings of $1200 for a $30,000 loan or a nice mini vacation.
And don’t get me started on dealership loans. The non-profit, Center for Responsible Lending, concluded that consumers who financed through a dealership overpaid by more than 25.8 billion dollars. The center specifically warned of hidden interest or “acquisition fees” averaging an additional 2.47% over the life of the loan. Fees that can total more than $2,500 per vehicle. That’s a nice long vacation.
Also, credit unions will often help you get pre-approved for a loan, before you even step into a dealership.
To sum it all up…Get the best deals on weekdays, especially Mondays. Do your homework on a car’s worth before heading to the dealer, especially for used cars. Watch for special deals during the holidays. And finally, get your loan from a credit union, because they actually are great.