How to get the best car deals:
Brief tips to help you in the car dealer:
How to understand discounts and offers for low financing:
MSRP Car: Manufacturers Recommended Retail Price - This price is always negotiable - never agree to pay MSRP
an exception : Some vehicles that may be “hard to find” or “limited in production” may be sold by dealers in MSRP or, sometimes, higher. This is usually called “Market Regulation”.
Manufacturers Discounts : It is your money and has nothing to do with the discounts offered by the dealer. This money is given directly from the factory. Never allow a discount to use a dealer as a negotiating tool. Any discount or negotiation from the dealer must be separated from any proposed discounts.
Low financing rates: 0.00% 1.00% 1.9%, and so on. They are called sublicensing rates, they are also offered at the factory, and not at the dealer network. Do not allow the use of "low" financing rates as part of the dealer negotiations. These rates are provided in excess of any discounts, discounts, etc.
Exceptions : There are a few exceptions for sub-ventilation financing rates, but here are two of them:
1. Not all people are eligible for these rates. Therefore, if you suspect that you may have some kind of problem because of which you will not qualify, there is nothing wrong with expressing to the seller that a low level of funding is what interests you and you would like would apply first before walking through the long, timely steps of negotiating a deal. Many dealers view this as unusual; however, any “good” dealer will be happy to give you a request first, if you insist. Why is it important? As we always say, knowledge and preparation are the keys to not overpaying at dealerships. What happens if your entire transaction is processed, agreed and completed with the dealer? Then you go to the financial office to complete financial conditions and payments ... You expected to pay 0.00%, then at the last second you were told: "Sorry" because you have no right ... NOT A GOOD TIME TO CHANGE.
2. Discounts and “low” financing rates may not always be combined. Some plants allow this several times, but there is no rule; you must do your homework first. For example, Chrysler offers manufacturers discounts on most of their cars, plus they offer low financial rates on most cars. Although, you, the client, must decide which offer you want, you cannot have both. Although, sometimes Chrysler will launch special offers that will allow you to simultaneously “combine” financing and discounts. But be careful, dealers will not always tell you that these offers are available, if you do not know, and you agree to pay higher financial rates, you are stuck.
Frequently asked question : Which the is an right choice, discount or low financing?
This is an interesting question asked by many customers, the answer is simple, but many people have no idea.
Remember this rule : You must do what is best for you, never ask a person, dealer or anyone else who has other motives than what is best for you.
This means the following: when you ask a dealership that makes more sense, the dealer will most likely tell you: "Take a discount - not a low interest rate."
The reason for this answer is that if you take a discount, you actually pay “less” for the car than if you had chosen a low interest rate. Thus, since the price of a car is the most important issue, you should always take a discount. Is this right or wrong?
The rule is: do not worry about what the dealer is doing or losing, it does not apply to what suits you best.
Does the dealership charge more if you choose a discount and a low level of funding? The answer to this question is yes, the dealership deserves more. They get a little more “reserve money” from a lender if you choose the usual financial rates. However a fact; that this moment is completely irrelevant. Who cares about what the dealership does? Why is this so important? Is there a rule that says the dealership is not allowed to make a profit? The only person who does something wrong in this scenario is you. You ask the wrong side for information. If a full and honest answer can force the dealer to do less, most likely the answers will be carefully weighed to fall on their side.
Remember: your care is the best deal for you, do not delay the time, taking care of what the dealer is doing. Be prepared by reviewing all the facts. Do not make the common mistakes of all the people we constantly care about who pays all the time.
Fact: people who think that dealers are losing money on them, usually those who pay the most!
Note. Please understand that the purpose of this and every other post that we write is NOT to conduct dealer centers for profit. Why shouldn't a dealer make a profit? What right should we ask them to lose money? Would you ever like to go to a restaurant and tell them that you will insure that they sell you lunch and lose money? It is stretching, but equally ridiculous.
The purpose of this post is to help fair people get the best deal for themselves. Protecting people from being “stripped off” by fraudulent dealerships is our motivation. We do not claim that all dealers are unfair or “break away from artists”, in fact, we know that most dealers are honest and ready. Although everyone in business makes a profit, the topics written in these posts are aimed at helping “fair” consumers to achieve “fair” and fair deals. Why do we keep mentioning "fair"? Because, equal to us, without worrying about fraud, we also do not worry about “unscrupulous” consumers who want good dealers to close their business and lose money.
“GOOD DEED happens when both parties are grateful”
As we have repeatedly said; price is not always the most important issue.
The following is the only and only correct answer for Rebate vs. low rate debt:
With any problem that forces you to make a decision, there are always certain facts, these facts constitute the pros and cons. Whatever decision we make, we weigh the pros and cons and fully lead to a decision. Then, of course, we hope that this decision was the right one.
Remember this rule : There is always a point where two lines intersect, and a point where you will find the correct answer.
It means; There are variables that create changes in each transaction. For example: it may be better for me take a discount while it's the best deal for you to reduce low financing rates. Let me explain:
You can finance 30,000 US dollars, and your financial term is 60 months. The factory offers a discount of $ 3,000, or 0.00% for a 60-month financial period. What do you choose?
I possibly will finance 12,000 US dollars. The factory offers a discount of $ 3000 or 0.00% for a financial period. Which one do I choose?
Obviously, the answers are different; your the break-even lines will obviously cross the path earlier than my lines. Reason: different factors in the two transactions will give different answers.
Here's how you figure out the correct answer based on your factors:
In this example, we assume that you are considering a car worth 30,000 dollars with a discount of 3,000 dollars or an interest rate of 0%, and in order to find the answer, we assume that you are betting 3,000 dollars in advance payment and you can claim all offers.
First: Draw a line to the middle of a piece of paper; on the one hand write assignment on the other hand write 0%
Secondly: on the side of 0% write in the sale price of 30 000 dollars, and on the left side (discount) write in the sale price of 30 000 dollars.
Thirdly: On both sides, add to your local tax rate. For example: if you live in Queens NY, add 8.25% as a sales tax.
Fourth: add $ 300 on both sides - this should cover the DMV Inspectorate and Doc Fees dealer.
Fifth: On both sides, deduct $ 3,000 for payment
Sixth: On the discount side, deduct $ 3,000 per discount.
If you did it correctly, you should still have the following results:
Both sides: must show Sales Price $ 30,000 Tax $ 2,475. DMV $ 300 Total: US $ 32,775
The bonus side must show US $ 6,000.00 Total initial deposit and “unpaid balance” in the amount of US $ 26,775.00
The 0% side must show a total advance payment of $ 3,000 and a “unpaid balance of $ 29,775.00”
Assumption: if you decide not to take 0% - the dealer offered you a 5.5% interest rate.
Compare to see where the lines intersect:
Next step - find a car loan calculator - you can go to any type of search engine in the “free car loan calculator”,
I can not attach a link to this message area, so I just offer a very convenient, free calculator (which we do not have in affiliation) - this is chase.com just search:
"Free loan loan calculator"
Calculate:
REBATE
$ 26,775 Amount of financing
5.5% per annum
60 month term
Answer: Payment of $ 511.43
Total interest: $ 3,910.80
Total payments $ 30,685.00
0% SIDE
$ 29,775.00 Financing amount
0% per annum
Answer: Payment of $ 496.25
Total payments $ 29,775.00
Summery: In your transaction, 0% was $ 910.80 less than REBATE, so obviously, the best offer for you is 0%.
On my sheet, using the same method, it turned out that the discount was a little more savings (only because I financed much less) if I decided to finance more money, despite the fact that the lines intersect earlier.
Final Notes:
1) If you decide to lower or raise your payment, and then lower and increase your amount, then the output from which of them will be better will be different. So, continue to test different scenarios using the above method, and you will find the best deal for you. Everytime!
2) Be careful: no discount is final, while low funding is not. Keep in mind this is a very important consideration: if you choose low financing for a discount - in fact, you just paid more for the car, and you cannot get this money back. However, you decided to do this in return for free financing conditions. (Very smart). You did your homework, you made a decision based on solid factors, and you made the least costly overall solution. EXCELLENT WORK! Although, you must remember that you made this comparison based on a 5-year maturity. If you keep the car for 5 years and pay as expected, you win, your calculations were perfect, and you have reached the best solution for you. On the other hand, if something changes and for some reason you decide that you are not going to keep this vehicle in the second or third third year ... Then you just canceled the benefits of low funding. The variables changed again, and the best deal returned to the discount. So remember that in privacy is your own home; carefully consider all your options and preferences. For example, if you know that you have not kept a car for a couple of years, this should be included as a decision-making factor.
In short A: Always put together all the facts first, limit the variables that can change the deal and negotiate with confidence.
