3. Know how much car you can afford before you begin shopping around. Most families should expect to spend no more than 15 – 18% of the household budget on transportation. This includes the monthly car payment and the total expense of running the car including gas, maintenance and insurance.
4. If you are considering an extended warranty, price it in advance. If you are torn between two great cars the difference in warranty prices for the cars may be the deciding factor. Often, more dependable cars carry lower warranty prices.
5. Take a friend with you to the dealer. Talk with your friend about your budget and goals before you visit the dealer. This strategy can be helpful when the pressure begins to come on strong. Don’t allow yourself to be bullied or cajoled into a deal that doesn’t even remotely resemble the one you really wanted. Remember, it is you that will be faced with that car payment each month. Remember too that you have something in common with the dealer; you want to buy a car and s/he wants to sell a car. Of course the dealer needs to make a profit to stay in business, but it should be reasonable and fair, after all – you have to eat too.
6. Don’t be fooled by zero down deals. Regardless of what the dealer says – calculate how much money you will pay over the life of the loan to get a clear picture of what you are agreeing to. There are loan calculators online at sites such as bankrate.com that can help you figure out loan costs. This site also has a chart that lets you calculate estimated monthly loan payments considering loan amount, terms and your credit score.
7. Find out in advance what happens if you drive home and change your mind. Can you bring the car back within a specified time period?
8. If at any time you feel uncomfortable or unduly pressured feel free to end the negotiations and leave. There are many other car dealers out there.
